The Startup Ideas Podcast - Making $$$ with Mobile Apps ($100K MRR Formula)

Starting point is 00:00:00 I'm going to show you how to build a 100K MRR mobile app. There are people today that are building this type of scale mobile apps, millions of dollars a year of revenue that have very little experience, but know how to create products that are niche enough, that resonate with people, and that hit the right marketing channels. Now, I'm not promising by the end of this that you'll be able to hit 100K MRR. No, of course not. But what I am promising you is that by the end of this,

Starting point is 00:00:27 you'll have the frameworks necessary, the thinking necessary, the sauce necessary for you start something that could hit 100K MRR or more. So my hope is that it gets your creative juices flowing and that you end up shipping something that that is valuable and that starts generating revenue for you and creates happy customers. Now there are literally kids now creating mobile apps that are hitting this amount of scale and it you know I think it's they've just have a good understanding of the lay of the land they understand creators really well they understand what makes viral apps really well they understand

Starting point is 00:01:14 what makes viral social format so if they can do it so could you I'm going to give the whole playbook here I have done consumer mobile in the past I've started and sold venture backed consumer mobile apps I was an advisor to Reddit advisor to TikTok so I'm not just a Joe Schmo and I you know, have been in the trenches and I want to share this sauce with you. It is no fun keeping the sauce to myself. It's like, you know, eating spaghetti. It's no fun to eat spaghetti alone. You know, you want to invite your family. You want to invite your neighbors. You want to invite your friends. So you are my family. You're my neighbors, my friends here today. All that I ask is you like and comment on this. So I know to keep sharing the sauce with you. And also, it'll spread to more people.

Starting point is 00:01:57 So, you know, I think the world is a better place when we have products that people love to use every single day. So let's get into it. If you want to build 100KM or mobile app, you want to pick a daily habit to serve. Important word here, habit. The habit is because of the frequency of it. You know, habits are something that you do frequent. You're going to want to find a narrow wedge use case. So you don't want to create something, you don't want to pick this huge, huge competitive

Starting point is 00:02:26 space, you want to pick something that's narrow and that wedges into something. And I will say having AI a part of that is important because that's going to, AI obviously is very interesting to consumers right now. They want to use consumer AI products. You're going to want to prototype this in a relatively short amount of time. You can use something like lovable or bolt. You can use something. I think they integrate with Expo to create the mobile app.

Starting point is 00:02:53 You can use something like Rourke, and you can use something like VibeCode app. And then you're just going to want to do distribution tests. So you're going to want to focus on one channel with three formats per week. So the mistake a lot of people make is they're trying five different channels, 10 different formats. No, I think, you know, the people that really crush it here are focusing on one channel. Think Instagram or TikTok and then just different formats. What I mean by formats, I mean, you know,

Starting point is 00:03:23 are you doing story, you know, like, I don't mean like an Instagram story, like a story where you're doing these, let me tell you about the story of how, you know, I lost 65 pounds or are you doing like meme style stuff, different types of meme formats and content formats that, you know, hopefully resonate. And I can do a whole video on how to find formats in the future. Once you find something that starts to take off from a format perspective, you're going to on board, you know, 100 true users. If you can't get 100, it's 12, 18, 25. Then you start monetizing them. The, you know, what you see is people either do X dollars per month or week or an annual basis. And then you do this retention loop and referral. So once you have a group of people,

Starting point is 00:04:12 you want to incentivize them to invite their friends. And then you start scaling via ads, ASO, app store optimization and affiliates. Typically, M-Sing. anywhere between 15% and 40% affiliate cuts for these consumer mobile apps. And then you get to 100KMR. It looks so simple, doesn't it? But it is more complicated than that. And in this episode today, we're going to go deeper in each of these different categories. And I hope to just give you a little bit more confidence around some of this stuff.

Starting point is 00:04:46 Yes, I know that people are going to say in the comment section, you make it look so easy, you make it look so easy. I'm not trying to make it look easy. I'm just trying to distill it as much as possible for you. So I talked about the keyword being a habit. And I want to just double click into that. A habit, you know, let's just say we're talking about in the wellness space. The habit might be something like a sleep tracking nuance. You know, in money, it might be micro-saving challenges.

Starting point is 00:05:13 And learning, it might be 10-minute space drills. In fitness, it might be form feedback bursts. And it even might be even more niche than that. You know, and it probably is. It probably is. Like, these are, this is niche and it's not niche enough, in my opinion. The important thing is, like, if you want to build something in wellness, let's say, and you want to build something in sleep, you want to look for an evidence of paid demand. That's, you know, a lot of people come up with ideas for mobile apps, consumer mobile apps.

Starting point is 00:05:41 And they have a lot of demand, but people are not willing to pay for it. So that is, that's like one of the biggest mistakes people make. Don't make that mistake. You want to look at a search volume within communities. You want to look for competitor gaps. You want to look at high frequency, daily use case, not weekly. You know, if you're seeing weekly use cases or monthly use cases, kill it. One of the reasons why Cal AI works is the people in that, you know, in that what is Cal AI?

Starting point is 00:06:11 You take a picture and it tells you how many calories it is. people are doing that every single day. In fact, they're doing it multiple times a day. So they're thinking it's valuable to them. They're willing to pay for it. And they're selling the outcome of look fit, look good, and people will pay for that. So there's a few ways that you can find demand. One is you can go to Reddit and you can actually just go into different subreddits. What I like to do is I like to just sort by the top or the best. And then you can actually, you know, sort, let's do top. And maybe this year, I mean, the SaaS subreddit. And then you can just see like what people are talking about. And just and it gives you validation to what you, what it is your building. So, you know, if it's, if it's health, you're building something wellness. Like what are the 10 different subreddits that you need to that you should be looking into?

Starting point is 00:07:09 How can you sort by top and best by the year, by the year, by the, the week, by the month, and then just write notes around what people are saying, how they're talking, and that'll help you validate it. One of my favorite features on Idea Browser is this Market Insights bit. So it basically uses AI to scrape Facebook groups and Reddits, all the stuff that I was doing manually, basically going to subreddits and trying to figure out what are the different pain points, what are some products that people are asking for? What are the different habits that these people have. But I just I built this to automate the whole thing.

Starting point is 00:07:44 So for example, I'm in this, you know, I can see the fractional executive marketplace and management OS. And I can see what are the different pain points and solutions and underserved segments and just literally go in and see how often

Starting point is 00:08:00 are people, you know, saying it's really hard to find fractional executives. And I can literally get quotes from people. how people are, you know, you can see the current workarounds, people are using LinkedIn and Upwork and TopTil. It's like, I never even heard of TopTill. And then willingness to pay signals.

Starting point is 00:08:19 Someone said burnt thousands of dollars. Several users mentioned two to 10,000 engagement gone, you know, gone R-R. So I just love playing with this, going through this, seeing what the different solutions that people are asking for. It's crazy that people are literally on Facebook groups and sub-refer. Redits being like, hey, someone go and like, I would pay for this. I would pay for this. They're asking for it.

Starting point is 00:08:45 It also goes into these underserved segments and much, much more. I just think that there's a treasuredrove of data in Facebook groups and subreddits. And yeah, that's why I built Idea Browser. Idea Browser is a paid, there's a free component and there's a paid product. What I showed you today was the paid product. And then TikTok, you know, it's free to use TikTok. And you can just, you know, if you're building something in sleep tracking, what you can do is just go on to TikTok, search for sleep tracking. And, you know, I'm just going to do that right now, sleep tracking.

Starting point is 00:09:25 And then once you search for it, you'll see on the top right, there's three dots. Click the three dots. And you click filters. and then you sort by the most amount of likes. And then you can just watch videos of people in your space to give you a sense of like, is there demand for this habit? So step one is basically finding this habit. Usually it's related to a trend.

Starting point is 00:09:53 But find a habit. You could use some of these tools to go ahead and do that. Once you've figured that out, you've figured out what you want to build. You know, this is sort of how I think about, you know, the experience of the app. So you create the app. The user basically discovers the app in the app store. There's a listing view in the app store. It's really important to have, you know, just a really clean, you know, name and app store previews that, you know, get people to want to download it, right?

Starting point is 00:10:30 So the conversion rate on the app store is really important. For example, I think the name VibeCode app is a really good name for a vibe coding app for mobile apps. So, you know, one of the reasons why this is now, you know, top 10, I think developer app is, you know, the name is really good. So think about how you can optimize the name and the previews include a video in there. So people are going to download it. they're going to open it. And then you basically have maximum 60 seconds in onboarding. And it's important to create value first.

Starting point is 00:11:07 When you look at some of the, you know, some of these apps that, you know, have a lot of virality to them, they basically have, you know, just a 60, you know, a very short value first mentality for developing that. And then you're going to create an account. They'll have a starter plan for success. and then you create like a daily check-in, and then you can create some sort of streak or nudge and progress within the framework of the app.

Starting point is 00:11:38 So to just summarize what we figured out here is, you figure out a habit, you figure out a micro niche in that habit, you validate that by things like Reddit, idea browser, TikTok. You optimize the app store previews. You optimize the name. You create a really good.

Starting point is 00:11:58 brand and you know you're off to the races you you know you include things like leaderboards and streaks and progress because you want people to feel like they're you know making progress and whatever habit they are there is and by the way there's so much like people people you know see these examples of like Cal AI and all these apps and they're like it's over there's too much competition there's so many different habits that and micro habits that and micro habits it's that there's opportunity for. So keep going. What I've seen in terms of pricing is there's usually a free trial between seven to

Starting point is 00:12:38 14 days. I'm actually seeing seven days to be a little more effective. And then what I've noticed is people are charging, you know, seven to, you know, I put $15 here, but realistically all the way up to $40 a month for different core experiences. You can do something where, you know, you have a paywall after. the first habit win. So, like, you get them to, you know, basically participate in the habit. They win. And then it's like, okay, now you understand the value of this product. Go and pay for it. Or you can do something like a $49 a year annual anchor, an add-on for a pro pack where it's like $5 a month or $10 a month.

Starting point is 00:13:20 This is for your like power users. You don't have to worry about this for your minimal viable product. This is like post-100K a month. But something to consider. also like do you want to create like a group or team plan you know for example cal a i for your company and stuff like that that's a way to get a lot of seats really quickly but again that's post 100k a month um this is the way to think about uh pricing so you know this is this is just helpful for me to think about um it might be helpful for you this this graph around okay so just around um how to think about getting a stranger onboarded and how to get them become an advocate for your company. So they download the app, they're onboarded.

Starting point is 00:14:06 You want to get that first success within 24 hours. And I can't tell you how important that is. If you can get success, like that win within the first hour, 30 minutes, two hours, that is actually so much. It's an order of magnitude better than 22 hours, 18 hours, 40 hours. because it just, you might not be able to win them back. So you get them for the first win. So important.

Starting point is 00:14:32 Your MVP is you're just focusing on the first win of the habit. And then you try to get them to engage back into the app. Think about like three sessions in seven days, building that routine, right? So you want to go from first win to building the routine. What ends up happening is people are going to go into different camps. So you're going to go in, some people are going to go into the camp of, they're not really using the app, they're idle. So you want to basically trigger a nudge or benefit.

Starting point is 00:15:02 So, you know, I see that you're not taking a photo of, you know, your, you know, your food today. You know, how can I, how can, how can you get the user to actually do that? And you want to position that as value for the user. The mistake a lot of app builders make is they think about themselves. They're just pushing the content. And they're like, I need you to be active because I know if you're active, you're going to be using this product more. You're going to be spending more money. But that's a mistake.

Starting point is 00:15:31 What you want to do is just position it as, okay, how can, let me, let me put my feet in the shoes of this customer. You know, what can I, what can I send them that's going to produce value that's going to get you to the win? So triggers and nudges are very important. Even if they're three days idle, you want to, you want to trigger and nudge them. And then you want to, for the people who do streaks, these are people that are going to be your active power, power of users. And then you're going to want to basically get those people and prompt those people to share and refer the product because those people are going to be your advocates. They're using it every single day. So you're going to basically segment those people and then send them notifications and communication on social and stuff like that that says like, hey, like, you know, if you share it, you're going to get X.

Starting point is 00:16:23 So in this section, I'm going to talk about how to actually get customers. This isn't the only way to get customers, but how I'm seeing a lot of these apps get customers. It's basically a mix of organic, owned, and paid. So on organic, what they're doing is they have these TikTok pages. Sometimes it's multiple TikTok pages. And they're also using IG with many chat integration. So I'm sure you've seen it. It's basically like they'll do a reel.

Starting point is 00:16:51 And they'll say comment, X, Y, Z. for more, and then ManyChat will automatically DM people. They're doing things like SEO, GEO. They're using platforms like X. I think even Roy from Cluley, the founder of Cluelly, was saying how important X is in terms of getting customers. They use that to send them, to get them on a wait list of some sort. You know, could be a newsletter, could be just a waitlist that's owned and operated.

Starting point is 00:17:21 And they also use things like paid. So, you know, ASA, which is Apple's search program. So the paid search when you're actually searching on the app store. They're using Facebook and IG creatives and they're creating tens, if not hundreds of them. And they're using clipping. I actually think that clipping, 97% of it is like complete waste of money. But some of them are seeing success around clipping. I should have mentioned, what is clipping?

Starting point is 00:17:52 Clipping is basically when you take long form, you put it into short form, and then there are these agencies that you can pay that will say, like, for every million views you get, you know, if you pay me $5 CPM, you know, I'll all go, you know, would you pay me $5 CPM if I get you a million views? Absolutely. Because then you're looking at it and you're like a million views. If I convert 1% of those to my app, then I'm going to crush it. But the problem is a lot of those views just aren't.

Starting point is 00:18:20 converting from what I've seen. So we'd love to hear what people are seeing in terms of clipping in the common section, but hard to find this working. I'm sure it does work in some cases, but for the most part, it hasn't been working. Or I haven't seen it work. Then in terms of owned, you also have the in-app share prompts. That's going to be a huge lever for you. And then you can do things like referral, where it's like three for one month.

Starting point is 00:18:50 Pro. So that's just a way to get your customers to have more customers. So I do think that you can get from like 30 days, zero to 30 days to app revenue. So you can do something like for the first few days, you define your wedge, then you define your, you know, wireframes and prototype. And you create your core loop, which is hard, right? That's, it's hard. But, you know, at this point, hopefully you can, you understand the habit. You've used things like Reddit, TikTok, and Idea Browser to validate some of it. Then you do the telemetry, the paywall, you do some onboarding and the ASO, then you do some channel tests, and then you work on retention. You could come up with an idea and build an app in 30 days and get to some revenue. You can screenshot this, but I do believe it's totally possible.

Starting point is 00:19:43 Let's talk about the metrics that you should care about if you're trying to get to 100K MRR. So retention, churn, streaks percentage is kind of an underrated one. You want to get that as high as possible. D7 and D30, meaning day seven and day 30 retention. The revenue, obviously, the ARPU, Arpoo average revenue per user, the trial to the paid percentage, you know, that's going to be a huge one. and the annual mix percentage. The acquisition, the cost per install, your organic installs, your ASA, CTR,

Starting point is 00:20:22 all of that stuff is going to be really important. These are all levers. You're basically a scientist, and you're playing with all these levers. In the referral camp, you have invites per users and the K-factor. K-factor basically means the virality of, you know, for every one person that comes into the app,

Starting point is 00:20:39 how many are they inviting? So if you have a K-factor above one, that's what you want to get because that means every person is bringing another person. And the activation camp, what's going to be really important to you is your day zero to D1 success percentage, your sign-up completion, and your time to first win. I included this over here because a lot of people don't know how to think about new features and what to put on the backlog of feature development. So the way I think about it is when you're coming up with an idea. So let's say you've built your MVP, you've got your core loop, but you know, it isn't exactly working. Some of these, you know, the retention isn't as high as you want or the streak percentage isn't as high as you want. So you're going to, at this point, you're going to come up with a bunch of ideas for how to fix that.

Starting point is 00:21:30 But it's important to use the impact times confidence over effort and put it into a score. You know, I call it the ice score. You know, not all feature ideas are created equal. So you have to, you know, you, if you're working with the team, you and your team have to come up with your best guess at what the impact's going to be if you create this, what your confidence is that and how much effort is it going to take to go and build that. And based on that, you can prioritize what you are going to ship this week. And then try to aim to ship three things per week. If not kill, defer that other stuff, right? Just like put it in the backlog.

Starting point is 00:22:12 Don't think about it. Focus on your one, two, or three things this week. If I'm building a 100K MRR mobile app, one of my North Stars is going to be weekly active paying users. And the way to think about that is you're going to have your acquisition volume, right? How many people are coming in at the top of the funnel? And, you know, how are you going to be able to, you know, get more of acquisition while you just, you know, play with your how much you're spending on app store keywords paid ASA, creatives, that's your IG and creator budget,

Starting point is 00:22:46 and then your organic, right, the activation rate, so your onboarding speed, the pay conversion, the pricing and the timing, and the weekly retention, which is streaks and notification. So I think that, you know, just thinking about the North Star as your weekly active paying users, W-A-P-U, and then thinking about playing with the levers of acquisition, activation rate, pay conversion, and weekly retention is how you're going to start thinking about it if anyone can go and create a mobile app that gets, you know, a few hundred dollars MRR, but the ones that get to 100K-M-R really understand these levers quite well. The monthly MRR, you know, because they're software businesses and there's not much cost,

Starting point is 00:23:31 your gross margin is going to be 80 to 90% before Apple takes their cut. So I think, you know, you don't want to spend a lot of money on paid first. In fact, I would spend nothing really on paid in the beginning. I would be working just on organic, doing my organic stuff, trying to get, you know, maybe some affiliate, but, you know, mostly organic. And then once you've figured out, okay, what's my, LTV lifetime value. Then you can start playing with paid.

Starting point is 00:24:06 And then you should think about paid as a payback within less than three months. You know, the LTV, how do you calculate LTV? This is a common question. It's your ARPU, your ARPU, average revenue per user times month retain. And then you should think about trying to get an LTV over KAC of above three. The best apps, the best consumer mobile apps have an LTV over KAC above three. and that's what I'm seeing in these 100K plus MRR consumer mobile apps is they just, they're spending a lot of money because, you know, it's, they're just getting paid back so

Starting point is 00:24:44 quickly. So this is the framework for how you could create a consumer mobile app and how some of the best people are thinking about it, that what I've observed. And without further ado, I'm going to actually give you four ideas. that I think could fit in this framework around the habits and that are sorely needed. So, and this is just to get your creative juices flowing. This is really to get, I know you're going to listen to this and you might be like, I don't really like this one, but it actually got me thinking about something else.

Starting point is 00:25:18 So the dog allergy scanner. So for owners of dogs with food sensitivities. So there's millions of dogs out there. A percentage of them have food sensitivities. People really care about their dogs, obviously. snap a photo of ingredient labels at the store, AI flags unsafe food for your dog-specific allergies. So what is the core loop?

Starting point is 00:25:37 The core loop is you scan, safe, unsafe feedback, save to favorites. You can monetize with a $5 month premium, so you can do multiple pets, you know, vet Q&A, custom diet plans, things like that. And then how do you grow this thing? Well, you do it via vet partnerships and pet TikTok. So really simple one. I think there's a lot of analogies here to like Cal AI. And there's a guy who has an app.

Starting point is 00:26:03 I think it's called, I think his name, he had Bobby, the Bobby approved app. And he has like a YouTube channel and he just says, you know, is this a healthy, is this a healthy Bobby approved, organic, no seed oils thing? And people, there's millions of people that scan in grocery stores to see if it's, you know, healthy. Well, this is just sort of a similar idea, but for allergies. And, you know, there's the saying for a business, are you a vitamin or are you a painkiller? A vitamin business you don't really want to be in. A vitamin business means like you don't really need it.

Starting point is 00:26:37 But a painkiller you really need. And this is something that would fit into the painkiller because obviously people don't want to feed stuff that is going to make their dogs' lives worse, worse than, you know, or just not fun, right? So we don't want to hurt our dogs. The second one is, second idea is something that actually triggers affects me. So I know this is well, this is why I included this one. So I get migraines and I would pay for something like this. So it's called the migraine weather guard. So for migraine sufferers who track triggers, which I do track my triggers, things like red wine,

Starting point is 00:27:19 things like some red meats and stuff like that, it uses. hyperlocal weather barometric pressure shifts to warn users hours before onsets. Daily check-in log symptoms builds personal trigger models, monetize via $7 a month subscription, affiliate with migraine products like cooling caps and supplements, and then you can do niche distribution through Reddit migraine groups, neurology clinics, and migraine TikTok. So another simple idea, you know, uses AI to basically figure this stuff out. That's the wedge. People would pay for it.

Starting point is 00:27:58 It's a painkiller. And that's the hook. You're starting to get it. I also like that it does the affiliate stuff. So that helps you get your LTV a little bit up. This one, number three, the silent study timer. So for students in competitive exam prep, like things like the MCAT, the CFA, the bar, and there's hundreds of thousands of them, you create something for them that's a study timer.

Starting point is 00:28:22 So it's not a generic Pomodora app. There's hundreds of those apps. But you simulate like a library vibe with a shared silent study rooms where avatars show up who's active. You can do gamified streaks, leaderboard for our studied, accountability groups. You can monetize via $29 a year, premium study rooms with advanced analytics that tells you, you know, how locked in you are. And remember we talked about names for apps, why certain apps are just crushing it.

Starting point is 00:28:54 Cal AI. We talked about the VibeCode app. Well, if something like this was called like locked in, I think it would do really well. And then the growth would be via YouTube, study with me channels and Discord servers. Another kind of idea I would have for this is a lot of people listen to Lofi studying music. So you can create like a YouTube channel, put Lofi music, make that music with AI, get people onto it, and then basically send them to this app. That's a this is an idea that will work. This idea will work. So you're going to go, you create the organic via these YouTube channels and then you send them to this app. I don't know why people aren't doing this. And you can also pay some of these other, you know, lo-fi channels to

Starting point is 00:29:43 promote some of your stuff with a link in bio. How much would it cost, right? So this is a good one. The one downside to this idea, I will say, is students are less likely to pay than for example, 37-year-old people suffering from migraines who have kids who just want to make sure they're not going to get it. But I do think this is a cool idea.

Starting point is 00:30:05 And the last idea is a plant watering AI coach. So we've all dealt with plants that we buy and they die and it sucks. So for urban apartment dwellers, Los Angeles, New York, Miami, snap a photo, and anyone, really, snap a photo,

Starting point is 00:30:23 but that's who you would target, I think. High disposable income, that sort of thing. Snap a photo of a plant. The app identifies the species, builds watering and sunlight schedule. You can send push reminders align with weather, skip watering if humid today, monetize via $3 a month premium, and then you do the affiliate thing, links to soils, pots, fertilizer. And then you growth via Instagram plant influencers and Etsy plant sellers.

Starting point is 00:30:50 So I think I put this as the end. It's probably my least favorite. idea because this is actually quite competitive. There are apps that are doing something similar that are making millions of dollars a year. But I do think that, you know, I've used some of them. They're not the best apps. And I still think that there's, you know, opportunity, even if there is competition to have your own take on it with the right name, with the right brand, and with the right go-to-market strategy. So this has been an episode on just building consumer mobile apps. You know, I think that for a while you couldn't build a consumer mobile app that got to this amount of scale without raising tons of venture capital and then taking it years of time.

Starting point is 00:31:40 But I do think that now, right now, as of recording this, there's just a remarkable opportunity because people on the consumer side want to try AI apps. and unlocks all these new behaviors like, oh, take a photo to do this and AI analyzes it. And then you have all these creators that could distribute your product. And I just think that's a remarkable time to build. And I think that people think that it's getting saturated with consumer mobile apps. But I don't think that's a case. That's my hot take. I think there's going to be so, so many examples of.

Starting point is 00:32:20 There's going to be like a hundred, you know, many versions of Cal AI or more that are successful. And my hope is that someone listening got a little bit of creative juices that help them be like, you know what, I am going to start an app. I am going to start an app. And that's all I can ask for. So if you enjoyed this, please let me know. I hope it got the creative juices flowing. Have a creative day, friends.

Starting point is 00:32:48 And I'll see you next time.

The Startup Ideas Podcast - Making $$$ with Mobile Apps ($100K MRR Formula)

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