Selling Apps Outside of the Mac App Store

It has certainly been a while since this blog was updated. We've been busy growing our app business through a combination of creating new apps and optimizing our marketing channels.

Today, we have some news to share that many of our customers have been looking forward to.

We have finally decided to start offering some of our Mac apps outside of the App Store. You can now purchase many of them directly from our website.

Whilst we don't expect many customers to purchase directly from us, those that do will benefit from rapid bug fixes (we don't have to wait for Apple to approve updates) and potentially extra features that cannot be offered in the App Store versions due to sandbox restrictions.

Another benefit of distributing our apps directly is that we can now offer free trials and discounted app bundles (a collection of our Mac apps for a special price if bought as a package).

For those that are interested, we opted to use Paddle for billing & license code management and Sparkle/Hockey for delivering app updates.

We will continue to maintain both direct and App Store versions of our apps.

Merry Christmas and a Happy New Year! :)

- Rishi, Co-founder, FIPLAB Ltd

Happy New Year (once again!)

Another year has gone by and for those of you that are still subscribed to our blog, we must apologise for an entire year without updates. We've been really busy with developing new apps and maintaining old ones that we haven't had the chance to set aside some time for this blog.

Over the past year, we've managed to double our revenues and hope to continue our bootstrapping series to document the events that have occurred since part 4 was published. Stay tuned for the next part in the series in the coming months :)

Happy New Year! We are hiring!

Hope everyone had a great Christmas and New Year! During 2011, things at FIPLAB really took off and opportunities just keep flooding in, especially after our blog series and interview on Mixergy.

We have some amazing apps in development and this year we are planning to double our revenues through creating more high quality Mac apps and expanding onto the Windows platform.

If you're interested in joining us, be sure to check out our careers page for more info on the vacancies we currently have available.

Our Mixergy.com Video Interview

After our successful bootstrapping blog series, Andrew Warner from Mixergy.com got in touch with us and asked us if we'd like to do an interview with him for his Mixergy readers. You can check out the interview entitled 'Bootstrapping An App Startup With No Programming Experience' here.

Bootstrapping a $30k profit/month company from our internship earnings (Part 4)

Before we get started with Part 4, we wanted to let you guys know that we're hiring for a full-time remote iOS/Mac developer, so if you're interested and have previous app dev experience, then please click here. Also our first episode of App Teardown is out, start the download now and it'll be ready by the time you finish reading this post :)

Lesson #16: Establish multiple revenue streams - if one dies, at least your business won't

Following on from our previous blog post where we explained how we managed to achieve $1000/day in revenue through our Talking apps, our new challenge then became to try and conquer the newly launched Mac App Store. Post Christmas, advertising CPM rates were beginning to decline on our free iOS apps, and to mitigate this, we turned our attention to creating more paid apps to diversify our income.

Earlier this year, Anirudh and I brainstormed ideas for Mac apps that would be used on a daily basis with a consistently high level of demand. We figured that most people use Facebook and Gmail, so creating apps that make it easier to use these services would be the way to go. This would not only help us to target the masses, but would bring in sustainable sales, rather than dying down after a short term craze.

By expanding onto the Mac App Store, we were able to quickly diversify our application portfolio:

Lesson #17: Undercut and Overtake

On 14th March 2011, we finally managed to launch FaceTab for Facebook, but by then there were already two competitors (FaceMenu - $5 and FaceBox Pro - $5). Their app idea was very similar, but ours was superior as it was the only app to offer colour coded notification support straight to your Mac's menu bar. Both competing apps were ranking high (FaceMenu was the top paid Social Networking app and Top 10 in the overall Paid category) and we were disappointed that we may have missed out on a big opportunity by a matter of days.

Therefore, we had to be smart and make use of the brief period of time we would appear on the front of the 'new list' for the Social Networking category. Unlike the iOS store, the Mac App Store has a far lower number of new apps being released on a daily basis (especially back in March), so being on the 'new list' actually helped us.

We decided to release our app for free and this had an instant impact on the rankings of our competitors. Within 24 hours, we destroyed their income and our app, FaceTab, became the No.1 Free Social Networking Mac App across the store. A few more days later, it overtook everything else to become the overall No.1 free app worldwide. 

After we had secured this top position, we quickly followed up with a Pro version of FaceTab (priced at $0.99 for the first 24 hours and then $1.99 thereafter). Since there is no advertisement model for free apps on the Mac App Store yet, a paid Pro version was a definite requirement. It launched on 29th March 2011 and offered users an ad-free experience with support for Facebook chat. Our paid app was not only better but also cheaper than the competition. By upselling to the Pro version from our free FaceTab app (which was still No.1), we managed to boost FaceTab Pro to achieve a Top 10 Paid apps ranking on the Mac App Store.

FaceTab free, being ranked Number 1, was generating about 12,000 unique downloads per day. Our Pro app was doing 750-900 sales/day. Check out how insane our FaceTab downloads were during this period:

Lesson #18: Innovate and Annihilate

Our tactic of killing off the competition with a free version and then upselling to a Pro version allowed us to become the No.1 free and paid app for Facebook. After a few months, FaceMenu deleted their app from the store altogether and FaceBox Pro made their app totally free. 

Following the price change, FaceBox Pro, despite being an extremely buggy and poor app, shot up the free charts and even displaced our own app. However, we continued to improve upon our app and managed to claw our way back up the charts. As of today, we have pretty much killed them off in most European countries and now we have our eyes set on knocking them off the charts in USA.

The App Store is a most vicious yet glorious technological battlefield, where your apps are your soldiers. One can either moan, shut shop and disappear when their soldiers are hit, or one can ruthlessly battle it out till the end with every last one of them. You can guess which of those strategies we prefer to follow!

Following on from the success of FaceTab, we knew that making a similar app for Gmail would be an awesome idea. We once again used our FaceTab app to cross promote MailTab when it launched, via a small text link at the bottom of the app window. Within a matter of days, MailTab shot up to become the No. 1 Free Productivity app and was ranked the No. 3 Free app on the entire Mac App Store, and we quickly followed up with a paid Pro version at $1.99. Essentially, this was exactly the same tactic we used with FaceTab, only that we didn't have any competitors this time around - even 90% of the code base for FaceTab was reused to create MailTab. 

At this point, our total combined daily Mac downloads were over 20,000 per day and total Mac App Store earnings were now exceeding the daily ad revenue from our iOS apps. Being so popular meant our revenues had split to roughly a 65:35 ratio, with Mac Apps earning the majority. At their peak, FIPLAB's total daily revenues were about $1,900/day, but averaging more at about $1,400/day.

We were raking in as much as $1200/day with FaceTab Pro sales alone, as you can see below:

Lesson #19: If you live by the API, then be prepared to die by the API 

Given our early Mac App Store success, we decided to create an app called FaceCrop, which utilised Facebook's current profile picture arrangement setup to easily allow users to create a cool picture mashup on their profile. With a sweet app icon and an easy as pie UI, the app was soon a Top 5 global Social Networking app with great reviews. With this simple app, we managed to bump up our daily revenue by a further $150! 

FaceCrop tapped into Facebook's own API to directly upload the photos from the app to the user's profile. A few weeks after launch, the app was still doing great, when out of nowhere, Facebook's auto-ban bot decided to disable our app's API key for no apparent reason. They did this to us, along with a ton of other Facebook API-reliant apps (web apps, mobile apps, etc), some even had hundreds of thousands of active users. For some devs, these apps were their only source of income. Luckily for us, it wasn't a big loss. We tried to appeal, but never heard back from Facebook.

So heed our warning - relying on third party APIs is a real risky move. It's great if you use it within an app to enhance its features, but if it is critical to the functionality of your app, then just bear in mind that one day, it could easily be disabled without warning.

Lesson #20: Make your apps inherently viral

The reason behind why FaceTab, MailTab and more recently, Tab for Google+, all did so well was not only because they offered users tremendous value in terms of convenience, but that they were all, in fact, apps that would be naturally viral via word of mouth/recommendation, etc.

We took this a step further and embedded a Facebook 'like' button on all of these apps and hundreds of 'likes' came in each day. Every time a user liked our app on Facebook, we gained a bit of extra exposure and this action would be showcased on their news feed.

Also, just a few days ago, we launched a free app called Maze. Very simple app, but extremely fun to make and use :)  We took the infamous scary maze game a step further and added built-in iSight recording, so those conducting the prank could get a front on view of the unsuspecting user's reaction. We then added in options to share these videos via Email, Facebook and Youtube. It's too early to tell if we have a hit on our hands, but the first few days have been positive, with the app breaking into the Top 200 overall charts in some countries. Sometimes viral apps like these can take a while to get going - here's hoping!

Closing remarks:

We've had a good number of people asking about the spread between our daily ad revenue earnings and our daily app sales earnings. By diversifying, we've almost created a perfect balance: our paid Mac and iOS apps contribute to about 55% of our daily turnover, and the remaining 45% comes from all our ad revenue streams (iAds, AdMob, Mobclix, etc).

So what's our plan for the future? Well, we are going to be focusing on growing our Mac App Store presence further. We think it offers the best way to build up a portfolio of apps that will continue to generate relatively passive income for years to come.

Well folks, this is the end of our bootstrapping series (for now!), we may release a Part 5 in the future when we have more exciting stories and more importantly, lessons, to share. For now, subscribe to our App Teardown podcast for weekly App Store tips and discussions. 

Thanks for all the overwhelmingly positive feedback, support and words of encouragement - we appreciate each and every one!

Follow us on Twitter 

- Rishi, Co-founder, FIPLAB Ltd

Bootstrapping a $30k profit/month company from our internship earnings (Part 3)

Before diving into how we started generating over a $1000/day in revenues, be sure to sign up for our new podcast. It's called App Teardown, where we'll talk with top app developers and work with new developers to make their products take off. First episode is next week.

As mentioned in our previous post, we were now in full swing with our London Cycle app, and with it, we were truly getting our first taste of providing customer service. 

Lesson #9: Treat angry customers with respect, they could turn into your biggest fans

The immense userbase of London Cycle meant we were bombarded with mails regarding technical queries, praise and at times, something not so sweet from a disgruntled user. Often, these unhappy mails revolved around rather trivial issues, which were usually addressed in our FAQ, but ignored by the sender of the mail. We've explained at length in a separate blog post which basically concludes that rapid, helpful and polite responses to even the most dissatisfied customers can be far more beneficial than one may think. Make it a duty to be patient with the harshest of critics, don't consider it a chore.

Lesson #10: Scan the market, pick your enemy and attack!

Alrighty, so Rishi left off in the last post explaining how we had just finished a lucrative contracting job for a company called Orangebox. The two week project made us just shy of $11,000 and this was without doubt, a very respectable earning. The money meant that we could definitely run this business for another 4 months, no sweat. 

It was now approaching the middle of September (2010), and there was one omnipresent app that kept grabbing our attention - Talking Tom Cat. We had both downloaded it on our devices and found it pretty hilarious. The execution and concept was good, and by adding Facebook and YouTube integration, it had a far more viral reach than the original app it was inspired from: Talking Carl. However, the quality of the character model and animations left a lot to be desired. We felt it was time we go right up against them and show them what FIPLAB quality is all about!

Since Halloween was just around the corner, we opted to take a different tactic from all the cats, birds and puppies that spoke back to you, and decided instead on creating a little monster-like creature that was just as ugly as it was cute. Hoping for a Halloween launch, a talking pumpkin seemed way too cliched, and we unanimously boiled down to creating a gremlin. 

Lesson #11: Spend money where it matters

Many bootstrapped startups get into a habit of trying to save money everywhere, often to their own detriment. Sometimes you've got to spend big in the right areas to get results.

We searched relentlessly for an awesome pre-made 3d model that we could purchase, but honestly speaking, the stuff we came across online just wasn't anywhere near what we had in mind in terms of quality.

To make our app truly great, we felt we needed something custom made with love, so we decided to post on some design forums and also on the London College of Art job board. The job applications started pouring in, several dozen a day, and we had a ton of showreels and portfolios to look through by the end of the week. However, this one designer, Tristan, stood out from the pack. We decided there and then to hire him for the project at a cost of $3,000.

We then went through the lengthy process of sketches, numerous revisions, stressful setbacks, arguments over the phone on things such as the right level of shine on the gremlin's eyes and why it was important to get that 'emotional connection' with the character and the user. It had to be life like.

Just check out the images below to see how the gremlin developed into one of the best looking talking characters on the App Store:

Lesson #12: Never underestimate your competitors and respect what they do right

The competition had a critical feature we knew was key if Talking Gremlin was going to be a success. Social video sharing. From our research, we had found that literally thousands of Talking Tom videos were being shared through YouTube, and other talking apps that did not have this feature were doing no where near as well in terms of sales.

Rishi and our programmer James worked together round the clock to solve the numerous programming challenges we came across, from achieving a smooth and acceptable frame rate to getting the gremlin's mouth movements synced just right with the user's recorded voice. Hardest of all was the recording and ensuring that the outputted video was bug free and within an acceptable file size, so that it could quickly be uploaded to YouTube and Facebook.

We ended up doubling the time we had allocated for this project, but we had a gut feeling this app was gonna be a success. At the risk of sounding incredibly sappy, sometimes you've just gotta use that inner drive to push yourself.

I then spent the next two days tweaking my own voice on a great software called Audacity. All the laughs, cries and effects you hear in Talking Gremlin are all me in my bedroom :)

By 25th October, we had finally finished and polished up our app and were satisfied that it would be the best talking app on the market, although we were a bit too late for Halloween. It had a much better 3d model, lots of great animations and was totally different from any other talking characters out there. Also this time, unlike CopterKid, we really took our beta testers' feedback into consideration, so we definitely knew we were on the right path.

We submitted the app to Apple for approval and to be honest with you, we waited rather anxiously. After one week, we got rejected! Argh! Their reason for rejection? Well, because the gremlin in one particular animation sequence would jump at the user and crack the screen. No cracking of the screen was allowed as Apple felt the user may think that their screen might have actually cracked (even though the animation lasted for a grand total of 2 seconds!). Nowadays, some of the highest ranking chart apps on the App Store have the sole function of faking a crack on your iPhone screen and have clearly been approved to be able to do so. Apple - you fascinate us every time.

Anyway, we quickly got Tristan to redo the animation and changed it from a crack to a magical blast and resubmitted to Apple. Luckily, this time they were satisfied and on 16th November, Talking Gremlin was live!

Lesson #13: Creating a superior app is not enough, have a well thought out marketing plan

We knew that by simply having a great app would not be enough to make Talking Gremlin successful. We had $500 set aside for marketing and we devised a highly targeted strategy to get our app into the hands of people we knew would love it.

We created a Facebook Ads account and made use of their amazing, sniper-like targeting options to display our advert to Talking Tom Cat fan page members. The CPC (cost per click) was really expensive, at around $0.30, but we knew that the conversion rate would be better than anything else.

Also, rather than linking the ad to our iTunes app sales page, we created a Facebook fan page so that not only could we track conversion rates, but also secure a direct channel of communication with these people for the future.

Within just 24 hours since launch, Talking Gremlin shot up the charts. When it reached 26th in Entertainment, we decided to give it that extra little push to get it into the Top 25 'Golden Zone'. We placed ads with AdMob and InMobi, and that combined with our Facebook ads helped us move further up the charts. After breaking into the Top 25, we started to get a lot more organic downloads and from 25th, we jumped into the Top 10 soon after, and eventually became the No.1 free app in several countries (on both iPhone and iPad), not just in the Entertainment section, but for the entire store itself. This was an unbelievable feeling.

At this point, Talking Gremlin was pulling in over 70,000 downloads a day and the ad revenue was amazing. iAds, still being novel, was monetising at an unbelievable $15 CPM and we had other networks such as AdMob and Mobclix as backup, which were achieving around $2 CPM rates.

Just imagine how we felt when we went from earning no more than $100 a day from all our app sales and ads combined, to over $1000/day in revenues on iAds alone for the Gremlin! 

The app had gone viral and Youtube and Facebook videos were being shared across the globe of Fip, our little Gremlin. We were really looking forward to how high our revenues would go during Christmas week, and the failure of CopterKid was now a distant memory. Check out the daily YouTube uploads here:

And then, just like a sudden twist in a movie, the iTunes App Store totally bugged out. The iTunes developer support shuts down for Christmas week and there was nothing anyone could do. The App Store database had rolled back to 5 months ago (i.e. it was showing the apps and rankings as they were back in around July 2010).

Talking Gremlin was the No.1 entertainment app, ranking above Talking Tom, but now, in the span of a few minutes, it had totally disappeared from any of the Top Charts or new lists, and could only be found from a manual, typed out search for it on iTunes. Could we be anymore unlucky? Guess which app was ranking number one in July that year? Yep, the Cat, so right to the top of the charts it went again. All this felt exactly like a scaled up version of precisely what happened with CopterKid.

Lesson #14: Start building up a cross promotion network

If you are serious about building an App Store business, you can't rely on making millions from a rare, one off hit. You need to plan for the long term and reduce the risk with each subsequent app you launch. The best way to do this, and pretty much essential these days to be able to get a good ranking on the App Store, is to implement a cross promotion screen throughout all your apps. This will eventually allow you to direct thousands of downloads to your new apps as soon as they launch.

Visibility is critical to success on the App Store and downloads = visibility. The more sure fire ways you have of generating downloads without having to spend money on marketing, the lower your risk (and cost!) of failure. Here's what ours looks like:

Lesson #15: If something does well, rinse and repeat

Talking Gremlin was a huge success and we knew that the framework we had built could be used again and again for more talking characters. We created Talking Snowball (total cost: $3,000) and Talking Gremlin: Xmas Special ($500) and managed to get these two apps out before Christmas. Despite not appearing on the iTunes charts (due to the bug), we were still able to push through thousands of daily downloads through our cross promotion screen alone.

Both apps generated tens of thousands of dollars in their first month. What a great ROI! Since then, we continued to make more talking apps such as Talking Monkey, Dragon and Turtle.

However, since advertising CPM rates were on the decline, we decided to further diversify our revenue streams and the launch of the Mac App Store earlier this year presented the perfect opportunity to capitalise upon a completely new gold rush.

We are now one of the top developers on the Mac App Store and at one point, occupied the Top 2 store-wide rankings for over a month. Our two flagship products are FaceTab and MailTab - both of which have hundreds of thousands of downloads.

In the next part of our bootstrapping series, we'll explain how we entered and dominated the Mac App Store through a very rapid and focused development approach. This helped us to diversify away from relying on ad networks whilst continuing to grow our revenues to over $1000/day.

Follow us on Twitter so you don't miss it!

Btw, we're launching a podcast called App Teardown. From the feedback we've received in our bootstrapping series (Part 4 coming out soon!), we teamed up with our friend Colin to produce a show where we will teardown top apps to find out what makes them tick, bring on guest developers to help them improve their products, and generally just give the inside line on how to make money on the App Store.

Click here to signup for emails on new episodes. No spam, just tidbits of money making gold.

Part 4 is now out, read it here!

- Anirudh, Co-founder, FIPLAB Ltd

How we turned angry users into our biggest fans

Taking a short detour from our multi-post bootstrapping series, we thought we'd give an insight into how we deal with customer support at FIPLAB.

Every so often, we'll get an email from a confused, clueless and undeniably angry user of one of our apps. The email usually complains about a bug they believe to be experiencing.

More often than not, it's a simple mistake or misunderstanding on their behalf (e.g. not clicking the right button, failing to configure a particular preference, not having the latest version of our app, etc). It's annoying to have to keep guiding novice users like these through the most basic of tasks, especially when we've taken the time to write out a FAQ.

However, rather than just sending a cold response with an FAQ link, developers should really consider writing a custom, super polite reply, for example (read from bottom to top):

*In case any of you are wondering, we couldn't autorefresh the data due to T&C with TfL.

This is how we turn angry users into our biggest fans. We've done this over a dozen times and it works like a charm. Note, this is not some manipultive strategy, but a genuinely positive approach to an otherwise monotonous (and often irritating) task - never act fake or condescending, or people will see right through you. Don't think of this as a chore, but as a responsibility to the betterment of your PR and the business as whole.

We've found that if we respond quickly (within a few minutes) to these emails with a rapid and easy solution, 99% of these users will email back overwhelmingly pleased. Not only because their problem has been solved, but due to the fact that they have received a personal, human reply far quicker than they ever expected, that's if they expected to be replied to at all.

Sometimes it seems as though these users are even happier than they would have been, had they not experienced any issues at all. Customers really reward rapid, personalised support far more than most companies realise. These days, when we receive angry emails, we just smile, as we know it's another opportunity to impress users with great customer service.

What's most interesting of all is that many of these users go beyond a simple 'thank you' response. They seem to transform from 'angry' users into 'product champions' in a matter of minutes - not only do most of them end up writing a positive review on the App Store, but some go far as to begin acting as free customer support agents by helping other users through our Facebook fan pages and Twitter.

So from now on, whenever you get an angry email, be sure to respond fast with a solution or failing that, give a genuinely honest reply stating that you are working on a fix/update. Don't miss out on great opportunities such as these to secure a lifetime's worth of goodwill from an 'angry' user.

Btw, we're launching a podcast called App Teardown. From the feedback we've received in our bootstrapping series (Part 3 coming out soon!), we teamed up with our friend Colin to produce a show where we will teardown top apps to find out what makes them tick, bring on guest developers to help them improve their products, and generally just give the inside line on how to make money on the App Store.

Click here to signup for emails on new episodes. No spam, just tidbits of money making gold.

Bootstrapping a $30k profit/month company from our internship earnings (Part 2)

Following on from our first post where we described the ups and downs of launching CopterKid and the lessons we learned, the harsh reality was that after the iTunes database bug, CopterKid never managed to recover its momentum and high ranking. I guess that whilst the bug with iTunes played a part in preventing CopterKid's mainstream success, the truth was that the first version of our game was simply too difficult for the average user.

Since we had been testing the game ourselves for months, we personally found it very easy to play, but didn't consider how a first-time player might feel. We failed to take on board the feedback we had received during beta testing and overlooked the most critical aspect of a casual, pick-up-and-play game - that it has to make the player feel happy. The best way to achieve this is to allow them to succeed and perform well at the game, particularly for the initial levels. No one wants to fail repeatedly after a few seconds and feel like they suck - that doesn't exactly invoke positive emotions!

Lesson #4: Don't give up and always keep looking for new opportunities

A few weeks after CopterKid's launch, our revenue from the app had fallen to only $15-20/day. By that time, we were really feeling the pressure to start making money, particularly since all our friends had found jobs and were earning a good income. The social stigma surrounding being 'unemployed' really sucked, so much so that we had to force ourselves to start looking for graduate jobs. We spent the next few months interviewing at various banks and hedge funds, but it never really felt right.

By May 2010, we were almost ready to take up jobs in the City when I came across a newspaper article about the new London bike rental system, or 'Barclays Cycle Hire Scheme' as it's known here, which was due to launch at the end of July 2010. In that article, the Mayor of London, Boris Johnson, challenged developers to create a mobile app for the upcoming bike scheme. This seemed like the opportunity we had been waiting for. That night, I phoned Anirudh and he agreed that we should pursue this idea as it was a great way to get the FIPLAB name known throughout London.

Lesson #5: Get exposure for your startup by capitalising upon topical news events

Over the next four weeks, we worked around the clock with our programmer, James Long, to build a simple app, which if proved to be popular, would be developed further. During that time, we found out about other similar apps that were being developed and thus knew that we had to be the best app in terms of features whilst also being the first to market. We ended up implementing the CycleStreets API, which gave our app the ability to provide cycle-safe directions from one point to another. This was definitely a significant point of differentiation from the competition.

After testing the app thoroughly, we submitted it to Apple for review along with an email literally begging to be fast-tracked, citing the impending launch of the cycle scheme as our reason. Luckily, Apple agreed and we managed to get our app out on the 24th of July, the weekend before the launch of the scheme. The timing was perfect and the app ended up getting a lot of media attention as the cycle scheme was very popular with the press at the time.

It all started with a great, unsolicited feature in London's most popular newspaper, The Evening Standard, and after that, it snowballed with other major newspapers and magazines following suit. The highlight of all this press attention was being contacted by the Apple iTunes Marketing team, who gave us only 24 hours to design promotional graphics to be used on their front page, large App Store banner feature.

Man, sitting up that night ensuring all our images, icons and banners adhered to Apple's ultra strict guidelines for the banner feature was nerveracking as anything, but what a crazy and exciting time!

Lesson #6: Don’t underestimate the importance of your App Icon

We had achieved our goal - London Cycle: Maps & Routes was receiving tens of thousands of downloads a day and helping Londoners on a daily basis. Taking a walk around Regent Street in Central London with Anirudh during this time, we both actually saw people using the app on their iPhones before embarking on their journeys - I can't tell you how downright awesome it felt to see complete strangers using our product in front of us. London Cycle soon became the No.1 free Travel app in the UK, trumping Google Earth, which had held that position for several months.

Apart from the press exposure, one of the reasons our app did so well was that it had a very distinct app icon, which not only stood out from the others, but was incredibly clear in what it stood for. We incorporated the iconic bike and colour scheme into our app icon, and this really paid off as people could instantly identify it amongst other apps.

Thanks goes out to my friend Colin Plamondon, who demonstrated to me how important an app icon is when he initially launched his app, Free Books. Despite being an ugly yellow and red icon with the Free Books text plastered over the top, it definitely helped his app get noticed in the early days and eventually led to him killing off his competitors (Classics & Eucalyptus [Eucalyptus - sweet name for a tree, not so hot for a book app...]) and taking the No.1 spot in the paid Books category.

Lesson #7: When you’re desperate, you’ll often end up making stupid decisions, so always sit back and think twice

Within a few weeks, we had amassed over 80,000 downloads and had thousands of daily users. Since our app was available for free (we wanted to dominate the market), we started looking for health/fitness related companies to sponsor the app in return for advertising on the app itself. We had a fair bit of interest, the most exciting of which was from Barclays Bank themselves (the official sponsor of the cycle hire scheme, these guys had spent over £25m to secure their branding on the cycles). Things were looking up! Our app was pretty much essential for using the cycle scheme and since launching, we had added real-time cycle availability to our app, which displayed how many bikes and free spaces were available at each docking station at any given time.

We had some very encouraging meetings with Barclays at their headquarters - this was especially surreal for Anirudh, where previously he used to walk in to the very same office as an intern every morning. Now he was walking in to directly discuss business with them. Nuts! They seemed really interested in sponsoring our app for a period of 5 years and the kind of money we were discussing was amazing. Barclays basically told us that they had two options, to make their own app, or to sponsor ours. Since it was preferred by TfL (Transport for London) for Barclays not to make an "official" app, and the fact that the Mayor of London had asked independent app developers to create apps for the cycle scheme, we felt that Barclays would go for the latter choice - sponsorship.

We left our final meeting with Barclays feeling pretty confident of a deal being done and they asked us to send them our development timetable with all the new features we were planning to add. We didn’t feel comfortable with sending them all this information, but we thought what the hell, this is Barclays and the deal was too important to potentially ruin over something as seemingly little as this. What a mistake! After sending them all our plans, the senior sponsorship officials at Barclays went completely silent, did not get back to us with their decision on their sponsorship and ignored all our emails.

It felt like we had been played and that Barclays had now taken all our ideas and were probably planning to develop their own app (they did, it took them a year though - by that time we already had 300k+ downloads and pretty much every iOS user who was part of the cycle scheme, already had our app). The cheeky buggers even went so far as to add ‘fiplab’ as a keyword in their app description!

Despite missing out on the Barclays deal, we moved forward by adding mobile ads to our free version (iAds + AdMob) and also launched a Pro version that we cross promoted on our free app. The Pro version became a Top 5 paid Travel app in just 24 hours after it launched. Just goes to show that people are willing to pay for useful apps that they use day in and day out. We priced our Pro version at £1.79, which was 3 times the price of competing paid apps, but they didn’t stand a chance against our feature list and well regarded reputation. After 3 days, our Pro app was the only cycle hire app remaining in the Top 100 Travel charts - we were now dominating both the free and paid markets, whilst generating a solid $120-150/day from ads and Pro app sales combined.

Lesson #8: Build something that people value and you'll never have to pitch for projects again

An unexpected side-effect of our London Cycle app’s popularity and press coverage was that a lot of media/tech people in London thought of FIPLAB first when they were thinking of getting an app developed. We literally got at least one email every day with people eager to hire us for development work. Also, we regularly got emails from happy users thanking us for creating an app they swore by, some were even high level executives such as Accenture's Managing Director for the UK, amongst others.

Since we were bootstrapping our company, we decided to take on a short two week project for a company called Orangebox, who wanted us to develop an interactive iPad sales tool/catalogue for their high-end office furniture. The app was showcased at the Royal College of Art's ‘Exploring Innovation’ expo and was very well received. The client ended up buying 25 iPads loaded with the Orangebox app for each of their sales reps, saving a lot of money by no longer having to print expensive high quality paper brochures that would be outdated every quarter and require reprinting.

We made a nice lump sum from this contracting job, which gave us enough runway to keep operating for another 4 months.

What we decided to develop in those 4 months led to our first taste of true success. In our next post, we are going to dive deep into exactly how we achieved over $1000/day in passive revenues with a marketing budget of only $500. 

Follow us on Twitter so you don't miss it!

 

Btw, we're launching a podcast called App Teardown. From the feedback we've received in our bootstrapping series (Part 3 now out!), we teamed up with our friend Colin to produce a show where we will teardown top apps to find out what makes them tick, bring on guest developers to help them improve their products, and generally just give the inside line on how to make money on the App Store.

Click here to signup for emails on new episodes. No spam, just tidbits of money making gold.

 

- Rishi, Co-founder, FIPLAB Ltd

Bootstrapping a $30k profit/month company from our undergrad internship earnings

We thought we'd kick-off this blog with the start of a multiple post series about how FIPLAB came into existence and subsequently transformed from a small side project into a business generating $39,000 in revenues and $30,000 in profit per month. Hopefully the mistakes we made, the things we did right and what we learned during the process will help other aspiring developers who are thinking about diving into the App Store business.

Part 1: Our entry into the world of app development

It all started back in February 2009, when Rishi and myself knew nothing about the iTunes AppStore, let alone software development. However, through an online chat we ended up deciding that we wanted to get involved in the iPhone gold rush by making a simple yet addictive game using a bit of the money ($2,000 each to be precise) that we’d made from our summer internships at investment banks.

We thought, or rather unrealistically hoped, that we could have an instant hit and be raking in millions after reading about some of the early indie success stories such as iShoot and Trism. Man, we were totally naive, but our sheer determination and creativity in the face of dismal failure helped us to eventually force our way to App Store sucess. What follows are three simple lessons we learned from developing our first app:

Lesson #1: Don't cut corners with the most important part of a project - the programming:

Using those savings and working from our bedrooms, we were able to keep costs down and hire an amazing designer for our 2D side-scrolling game called CopterKid. Once the graphics were sorted, like typical clueless guys with no software dev experience, we set about trying to cheaply outsource the most important part of our game - the programming. Utterly silly move.

Rishi and I are two proud Indian dudes from London, so we thought that outsourcing to a company in India would not only be ridonkulously cheap, but also a way for us to show much love to the Motherland. Right? Wrong. After months of delays and disappointments (i.e. from dealing with project managers all the way up to the owner, and even resorting to speaking Hindi down the phone to tell them to get their act together), we had to pull the plug and fire those idiots. Luckily, we managed to get all our money back. To salvage the project, we ended up hiring a top computer science graduate from Germany who managed to whip out the app in about 1.5 weeks (in his spare time!). What a difference! Outsourcing to India on the cheap? Never again. When the costs seem too good to be true, they probably are, so this was a very valuable lesson we learnt.

After weeks in review, CopterKid finally made it out on the App Store in July 2009, but by that time there was a heck of a lot more competition. Being confident that our game looked awesome, we still had high hopes for its success.

What started off as a quick sketch of our concept had transformed into something quite remarkable and totally real:

Lesson #2: Be creative with grass-roots marketing:

Since we weren’t doing the programming ourselves, we spent a lot of time and effort doing ground-level promotional work, such as creating a FIPLAB and CopterKid twitter page, facebook fan pages, Touch Arcade posts, press packs, a promo video, etc. By continually engaging our fans on twitter, we slowly built up a following of over a thousand people prior to the launch of the app. We spoke to our fans every day and basically got them involved in a lot of CopterKid's creative design decisions by running polls to choose character names, app icon designs, gameplay objectives, etc. There was a real sense of community amongst our fans and us, and the buzz surrounding CopterKid's launch remained high.

Lesson #3: Don't put all your eggs in one basket - always remember you're at great risk when you're reliant on a third party (Apple):

As a result, CopterKid managed to be an instant hit upon launch, priced at $0.99 USD. We eagerly watched the app rankings rise (using a nifty tool called MajicRank) in the 'Kids and Family Games' categories.

Our first few days were as follows:

Day 1: 84 Sales, Top 50 Ranking

Day 2: 161 Sales, Top 25 Ranking

Day 3: 346 Sales, Top 10 Ranking

Day 4: .... Disaster. The app vanishes from the iTunes App Store along with several hundred other new iPhone apps launched that week due to a database update bug/error.

Back then, most devs believed that chart rankings were based purely on a three-day moving average of sales. This glitch with the iTunes database caused our app downloads for the fourth day to completely drop off. When CopterKid finally did reappear nearly a day later, we had entirely lost our momentum and our ranking had fallen to well below the Top 100 in the Charts. Great...

After all the effort and late nights we had put into CopterKid, I’m sure you can imagine how bummed we were, especially after achieving a brief and very promising taste of success. If you can’t imagine how bummed we were, then trust me, it sucked.

We were pretty much back at square one. I seriously contemplated cutting my losses and returning with my tail between my legs. Where? To the world of banking, where I’m sure my boss would have shoved that very tail up my butt as I sat at 2am finalising whether to use Arial or Times New Roman on the 197-page client report I was forced to write over the weekend. Rishi felt much the same. *shudder*

Don’t worry, we didn’t give up on our dream and I’m so glad about that. Developing and launching CopterKid was a great experience, even the iTunes glitch was important in getting us to where we are today. More on this in the next post...

Follow us on Twitter so you don't miss it!

- Anirudh, Co-founder, FIPLAB Ltd