Tinder Logo.
Sean Rad has been stripped of his title of CEO at explosively popular online dating app Tinder. The co-founder has been demoted to president and will serve on its board, a far cry from the controlling position he previously held. The circumstances behind his demotion are what what make it interesting, and make what we have learned about entrepreneurs, intrapreneurs and business ethics come to life. Rad is left with only a 10 percent share in the company because he was a paid employee of a tech incubator called Hatch Labs when the app was developed. Since IAC owned the majority of that company, it gained majority ownership in Tinder when Hatch closed down in 2013. The IAC allowed Rad to pour his blood, sweat and tears into the company, and proceeded to rip it out of his hands, using a sexual harassment lawsuit between feuding co-founders as the nail in the coffin. Even though he wasn’t a perpetrator, his involvement alone, in combination with the Barry Diller and IAC’s equity in Tinder, gave the IAC enough ammunition to carve out a controlling stake in the company and cut Rad out of drivers seat. This bizarre takeover has shown the significance of establishing boundaries in the workplace, as well as the brutal reality of technicalities in business. Even though Rad co-founded Tinder, it was cultivated while he was an employee using Hatch’s (the IAC’s) resources, making it theirs.
Sean Rad (right).
