Creating a tech startup

How To Make A Successful Mobile App

First, the important facts:

1. A typical smart phone user looks at their phone about 150 times per day


2. People use their smartphones to get “Just in time” information:

- Coordinate a meeting or get-together

- Solve an unexpected problem that they or someone else had encountered

- Decide whether to visit a business, such as a restaurant

- Find information to help settle an argument they were having

- Look up a score of a sporting event

- Get up-to-the-minute traffic or public transit information to find the fastest way to get somewhere

- Get help in an emergency situation


3. People use their smartphones to pass time: Playing games, reading, chatting etc.


4. To make a billion dollar app, choose an idea that has a global mass appeal:


A list of 67 human univerals, things every human is concerned about, one time or another:

Age grading, athletic sports, bodily adornment, calendar, cleanliness training, community organization, cooking, cooperative labor, cosmology (study of the universe), courtship, dancing, decorative art, divination (predicting the future), division of labor, dream interpretation, education, eschatology (what happens at the end of the world), ethics, ethno-botany (the relationship between humans and plants), etiquette, faith healing, family feasting, fire making, folklore, food taboos, funeral rites, games, gestures, gift giving, government, greetings, hailing taxis, hairstyles, hospitality, housing, hygiene, incest taboos, inheritance rules, joking, kin groups, kinship nomenclature (the system of categorizing relatives), language, law, luck superstitions, magic, marriage, mealtimes, medicine, obstetrics, pregnancy usages (childbirth rituals), penal sanctions (punishment of crimes), personal names, population policy, postnatal care, property rights, propitiation of supernatural beings, puberty customs, religious ritual, residence rules, sexual restrictions, soul concepts, status differentiation, surgery, tool making, trade, visiting, weather control, weaving.


5. It takes 7 years to create a billion dollar app-based business, and the average founders' age is 34. All founders have a technology background. 80% had earlier start up experience. More then half are based in Silicon Valley.


6. Five business models for mobile apps

1. Gaming, where users pay for a virtual service or good.

2. E-commerce / marketplace, where users pay for a real world good or service.

3. Advertising (or consumer audience building in the case where the company has not yet switched on the advertising).

4. Software as a Service (SaaS), where users pay for cloud-based software (typically via a subscription model).

5. Enterprise software, where companies pay for larger-scale software (again, via a subscription-type model).


7. All successful apps go through the same process:

Rigorous idea validation - Focus on making something want and will use repeatedly - Testing each stage of product development (wireframe - screens - flow - etc) rigorously - Show the product to target users, get suggestions, improve (This is what they call 'getting product/market fit').


8. iOS brings more money, but Android has greater reach.


9. Important mobile app metrics

Acquisition: Users download your app from a variety of channels

Retention: Users come back and use your app multiple times

Referral: Users love your app so much they refer others to download it

Revenue: Users complete actions on your app that you’re able to monetize.

CAC ( Customer Acquisition Cost): Price you need to pay for someone to download and install your app.

CPD, the Cost Per Download: Similar to above


10. What investors like in mobile apps

- download-to-user-acquisition rate of around 80–90%

- being able to activate upwards of 50 per cent of your users.

- Retaining users: Gaming apps should see users coming back daily - eCommerce apps should come back 1–4 times per month.


11. No-one did it the first time: Many successful app started out as something else, and it took them time to learn, refine and get to where they are today


Instagram (Originally,

WhatsApp (Originally, Status sharing)

Snapchat (Originally, Picaboo)

Clash of Clans (Originally, multi-platform)

Angry Birds (After 52 attempt)

Candy Crush (After 11 years)


12. Find the triggers: The things that drive people to want to download, use and talk about your app.


Questions to ask yourself:

- List the top five emotions you want your app to elicit

- List the top fifty words that describe your app

- List the top fifty words that describe your brand

- List the top customer needs your app satisfies and benefits it delivers

- List the top problems your app solves

- List the top fifty words that describe your competitors’ apps

- List the top fifty words that describe your competitors’ brands.


13. Valuation of $10 million: Focus on emotion (love or hate). Do not get stuck in the middle. Get a reaction.

At least 40 per cent of users saying they would be ‘very disappointed’ without your product.


14. Valuation of $100 million: Now that you have captured the love' part, time to focus on business model, profit margin and product development.

- Where you either go for growth: acquire more users, generate more revenue, at the cost of profitability

- Or, you go for profitability: sacrifice some user and revenue growth but have more control and potentially position yourself to fund your own growth and not give away more of your company to investors

- Every character on the screen counts

- Learn from best new practices from mobile users in China, who are the new trendsetters

- Create a playbook: Best practices, checklists, templates for everything

- Make sure your customer acquisition cost (CAC) to be less than your lifetime value (LTV)


- Focus on virality

The first page of your app should make people happy.


Your viral coefficient, K = X × Y × Z, where:

X is the percentage of users who refer or invite other users to download your app;

Y is the average number of people they invite (over a specific period of time);

Z is the percentage of people invited who download your app.


A metric that affects your virality: cycle time.

Cycle time is the average amount of time between when an existing user initiates a ‘referral’ (invites a new user to the app), and the moment the new user downloads the app. The shorter this period is, the faster you will grow.


15. Valuation of $500 million: This is when you must show the world that your app can become the undisputed leader.

- You will the right people: Have a clear idea of what would make your company global, and thus get clear about the type of people you need to hire.

- Fire quickly.

- Have an on-boarding programme so new joins can quickly get to work.


16. Valuation of $1 billion: Where you keep tuning the business model, while keeping users happy.

- Big companies re built on people. You will need to create positive, growth-minded culture.

- Now you start focusing on per employee revenue: E.g. The revenue per employee of Netflix is $ 2.2 mln, the profit per employee for Apple is $ 460,000.


If you want to generate a billion dollars, you need to touch a billion people.

- George Berkowski


Adapted from 'Billion Dollar App' by George Berkowski, Co-founder of Hailo


Thank you for reading.
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