Wiley Appillionaires: Secrets from Developers Who Struck It Rich on the App Store
Contents
1. for those that fear an app bubble is growing is the justification for this enormous sum Flipboard s CEO Mike McCue appeared to be channeling the venture capitalists who backed him when a journalist asked how the company could possibly need or want that much money a AT amp T gt 6 58 PM OF Aka _ F 9 a Sally Megan Jeff Peter Jessica Mike Lindsey amp John Color the most costly iPhone app built so far It took a 41 million investment to launch the software At the time of writing it has sunk down though the charts and user reviews of the app average two stars out of a possible five SOURCE Copyright Color Inc Chapter 1 Introduction 13 We decided the only way you could get to a multi billion dollar business is through advertising So given that to build an advertising business you ve got to have a lot of scale You ve got to build a consumer brand acquire tens of millions of users McCue told TechCrunch in spring 2011 This is the kind of language the app industry is beginning to use more and more often The CEOs themselves have begun to echo the standard VC venture capitalist mantra to build it bigger and bigger faster and faster The VCs favorite word is scale and although the tech industry has always attracted a legion of the wealthy and bewildered the App Store has drummed up a mass of investment unseen since the dotcom boom The Appillionaires have through their success spawned a climate w2. and the disasters The rise of the app has massively altered the public perception of what a software programmer is It s turned a generation of geeks from social misfits into superheroes Mention to someone that you make iPhone apps and their interest will pick up instantly They may even ask if you re a millionaire This is an astonishing change from what a programmer in the 80s could have expected in reaction to their job description We now live in an age where companies like Tapulous can apparently without irony run a job ad that reads We are hiring rock star developers Amazingly if you visit a modern development studio you may find that the workers are treated a bit like rock stars The demand for good programmers has never been greater and this is reflected in the perks being offered to entice them to new start ups SUMMARY A good iPhone programmer is rare and much in demand The geek kings you ll learn about in this book have become increasingly aware of their value The Appillionaires have encouraged a new breed of programmers born in their image who are edging toward the golden days of the dotcom bubble a time when technology geniuses could entrance docile investors with promises of glory Riding around your Soho loft on a kid s plastic tricycle while the head of marketing squirts you with a water pistol has become socially acceptable again We live in crazy times Here s a roundup of the important points covered i
3. just get to do what I want to do now says Max who made over 16 000 a day at the height of Plunderland s success The smash hit pirate themed caper Plunderland created by Max and Scott Slade SOURCE Copyright Johnny Two Shoes Ltd With an appetite for glory coupled with 24 hour access to the Internet relationships are strong in this industry The Appillionaires are sometimes friends and often relatives They may even be husband and wife like the J10 Appillionaires Secrets from Developers Who Struck It Rich on the App Store team behind Harbor Master who you ll revisit later in this book They eschew all traditional visions of the storefront Appillionaires work from garages bedrooms and caf s and then distribute their creations electronically THE SIREN CALL Perhaps more fascinating than the Appillionaires themselves is the mystery and allure surrounding the app business It s become a siren call for thou sands and thousands of amateur programmers and designers intent on living the App Store dream and becoming an overnight millionaire One thing that stood out as I interviewed the app makers in this book Often they discov ered that complete strangers would stop and pitch them app ideas Just as doctors find people asking them for medical diagnosis at a party the app makers often find themselves in the middle of impromptu pitching sessions I get pitched app ideas all the time I got a phone call from a frie
4. t burst out laughing or they haven t burst out laughing Lim explained It is madness but there s a small window of opportunity to make an impact You ve got crazy people coming into the app scene there s ridiculous money out there and there ll be a crash But there will also be a second spike where it s all more refined 14 Appillionaires Secrets from Developers Who Struck It Rich on the App Store THE BAND OF DREAMERS In this book you ll going to meet the rich famous and eccentric of the app development world This unlikely band of dreamers includes the two brothers from Croatia who have sold over 10 million copies of Doodle Jump The husband and wife team from Washington DC who made a fortune with their 1 99 app Harbor Master The studio behind Angry Birds whose blockbuster app now looks likely to become a Hollywood feature film And the makers of Pocket God and other smash hit apps You ll hear directly from these visionaries and learn their secrets first hand It s a weird and wonderful land where bedroom coders turn into millionaires overnight Where teenaged code monkeys flirt with venture capital and the good die young iPhones in hand Cut the Rope is just one of many iOS success stories It sold over one million copies just nine days into its release SOURCE Copyright Chillingo Ltd Chapter 1 Introduction 15 In this book you re also going to meet the underdogs The broken hearted the failures
5. INTRODUCTION THEY ARETHE Appillionaires Smart ambitious dreamers in bedrooms and garages across the world plotting the future of mobile apps Their tools are inexpensive a MacBook Pro and an iPhone but overnight the Appillionaires can amass a fortune from selling software on the iTunes App Store They lead a revival of the hobbyist programmer Not since the days of the Commodore 64 and Atari 2600 has indie software been sold by such tiny teams of programmers to such massive numbers of consumers The money flows to the Appillionaires even as they sleep While they dream their Angry Bird dreams invisible electronic transfers push money into the Appillionaires bank accounts from App Stores in over 80 different countries As much as 250 million gets spent at the App Store in a single month Over 10 billion apps have been sold on the store to date and it s estimated that Apple has signed up at least 79 000 software publishers to the iOS iPhone and iPad operating system club What s remarkable is that Apple s credibility was bolstered so much by the success of the iPod and iPhone that the rise of the iPhone app was widely predicted Even before the launch of the App Store back in 2008 Wired magazine speculated iPhone software development may spark a software gold rush not seen since the heyday of PC platform development in the 1990s 4 Appillionaires Secrets from Developers Who Struck It Rich on the App Store THE
6. RE S GOLD INTHEM HILLS It s this label gold rush that has been most often applied to the App Store The potential for success and risk of failure is so great that in many ways the App Store has provoked a gold rush among developers Although the successes are spectacular the failures are apocalyptic The mainstream press focuses on the glorious few and gives very little attention to the money being lost on the App Store a problem compounded by the embarrassed silence of those struggling to turn a profit on their work In a climate where approximately 540 apps are submitted for review every day it s easy to see why the Appillionaires are an exclusive and rare breed Back in the 80s a catastrophic failure to sell software was a more obvious and public humiliation Take Atari s E T the Extra Terrestrial 1982 a failed videogame which left the company with losses of over 100 million and the embarrassing problem of what to do with 3 5 million unsold E T cartridges the answer apparently was to bury them in a New Mexico landfill But today such failures are even harder to see with the naked eye For every Appillionaire there are several thousand invisible failed app developers These developers have had their dreams of app superstardom cruelly smashed into a million little pixels More humbling still is the realization that despite everything the App Store has done to democratize software development ultimately success may com
7. Y In the midst of all this confusion and competition there are also stories of great friendship and often a wonderful sense of camaraderie among the Appillionaires The community of people behind the apps you use on your iPhone and iPad are uniquely creative and communicative often building extremely close friendships with other app makers Take characters like Mills from ustwo the self styled King of Failure and a Twitter superstar who takes as much pride in his app disasters as his successes Mills is the closest thing the industry has to a cultural barometer providing a constant stream of consciousness direct from the mind of a leading app developer To read his Twitter feed is to witness first hand the turmoil in the soul of an Appillionaire As his company s apps drift wildly in and out of the top ten his tweets tread a spectrum of emotion from the heartwarming advice make love not code to later in the day simply I give up TheYajhtaa after the Nursery Rhymes with Storytime is Mill s most successful indie app to date SOURCE Copyright ustwo Ltd and Atomic Antelope Ltd Chapter 1 Introduction 9 This book is also going to introduce you to the smaller teams like Johnny Two Shoes Two brothers Max and Scott Slade who created the indie pirate romp Plunderland an app that allowed them to drop out of the nine to five slog and embark on a philosophical adventure punctuated by late night coding binges I
8. by thousands of blogs Some developers have discovered shill reviews on their apps traced these back to rival companies and phoned the CEO to ask why his head of mobile marketing was writing reviews of competing apps Tensions between competitors are inevitable because the Appillionaires fight it out in a crowded landscape of over 160 000 apps It s a place where millions of dollars can be made or lost in an instant where dropping off the top ten in the App Store means an exponential decline in sales obscurity and even ruin It s a bizarre upside down chaos where venture capitalists might spend millions on an app only to discover themselves beaten to the top spot in the App Store by a 15 year old armed with nothing more than a Mac and a dog eared copy of Objective C For Dummies The size of your corporation and the scale of your investment can be outmatched simply by the intellectual prowess of your competitor working out of his or her bedroom APP STORE ROULETTE Given its unpredictability what makes the App Store so popular One theory is that we enjoy the strange psychological lure of uncertainty Researchers have discovered that we often find relationships more compelling if the object of our affection is mysterious and non committal The image of a girl sat on a lawn picking petals from a flower and musing He loves me he loves me not is a fairly accurate depiction of a developer s relationship with Apple On one hand the gir
9. e from more unpredictable forces than basic hard work Most indie developers struggle to get any attention for their apps they simply don t have the marketing clout of giant corpora tions and must rely entirely on their placement in the App Store For many the only real chance of success is to be featured by Apple in one of the highly desirable iTunes banner adverts As iPhone developer Sean Maher points out you can t put get featured by Apple in your business plan any more than you can put win the lottery in your personal budget The Appillionaires are engaged in trench warfare against each other and against the traditional publishers of corporate America s vanguard App development has become a cut throat industry where an increasing small number of independent players battle it out for the attention of over 180 million iPhone and iPad owners each of these owners downloading around five apps per month The competition is so intense that the App Store is scarred by the Appillionaire s rivalry Shills have been known to clog up their rival s apps with bad reviews on iTunes while writing positive reviews for their own apps Apple s Phil Schiller has gone as far as to remove a developer Chapter 1 Introduction called Molinker from the App Store for cheating the reviews system by positively rating its own apps The end result was that Molinker had all of its 1 100 apps pulled from the store and was shamed globally
10. here VCs circle greedily In meetings with them you can almost see the dollar signs spinning in their eyes Armed with hedge fund capital and fresh from their MBA they are the pinstriped wildebeest hunting for The Next Big Thing Max Slade from Johnny Two Shoes remembers the initial attack from VCs well After the success of Plunderland he had to take urgent action to fend them off We actually unplugged our phone because we were getting so many calls from VCs saying We want to give you some money let s give you some money Here have some money Money Money Slade tells me He then mimes a grinning lunatic throwing out bundles of cash Oddly this is possibly the most accurate depiction I ve witnessed of how investors react to an App Store success story In the end Slade declined to accept any VC cash This book also serves as an expos of the app VCs and the people they hunt desperate to invest their cash in the early stages of a your dream They re eager to talk to young hopefuls like Andrew Lim who is like me a former journalist turned app developer Lim is trying to get venture capitalists interested in his new app idea When I first asked him what his idea was he told me I m making the next Face book Facebook Two basically He then burst into laughter I told Lim it was possibly the least convincing pitch I ve ever heard Tve been talking to investors and I haven t been to a single pitch where I haven
11. ictable whim of the masses that determine the success of an app The App Store might look like an ordered system but really it s just a layer over the messy reality of selling anything CHALLENGES WITHTHE APP STORE The App Store does present some unusual problems though For one the sheer number of apps available Craig Hockenberry who made the popular iPhone app Twitterific complained as early as 2008 that a race to the bottom on prices meant his team could not invest time and money in great apps We have a lot of great ideas for iPhone applications said Hockenberry Unfortunately were not working on the cooler and more complex ideas Instead we re working on 99 titles that have a limited lifespan and broad appeal Market conditions make ringtone apps most appealing But in the intervening years the 99 price has not won out completely App developers 2D Boy sold more than 125 000 copies of World of Goo for the iPad priced at 4 99 in just two months and several best selling iPad book apps have also skirted 9 or more Developers sometimes attempt to make money simply by selling enough apps at the cheapest possible price but this isn t always the best plan Often a lower price just invites a torrent of abusive reviews from younger more flippant users who take a chance on an app they don t really want Still deciding what to charge for an app remains a strange art and only adds to the curious reverence many of us feel
12. l with the flower hopes that he loves her but on the other hand a lot of the fun is down to not knowing Its human nature that we are attracted to the thrill of never being quite sure where fortune will smile and there are few businesses where that feeling is more acute than iOS development Everything about the process is uncertain Developer Daniel Markham calls iPhone development App Store Roulette and Andy Finnell of the software studio Fortunate Bear cautions against hoping for App Store success you re betting a lot of this on luck and the odds are stacked against you Youd have better odds playing slots at a casino Indeed as much as app development has been called a gold rush there is an equally loud theory that it operates more like a casino 5 6 Appillionaires Secrets from Developers Who Struck It Rich on the App Store The closest thing I ve seen to a business model for marketing iPhone apps is to advertise like crazy until you get into the top 50 says David Barnard of AppCubby once youre there the top 50 list will start generating its own buzz But that s not a business model that s like rolling the dice at a casino The counter argument is that life itself is hard very much like rolling a dice at times It might be that the App Store simply gives developers the illusion of an ordered system with top ten lists and sales tracking but ultimately it is human nature and the unpred
13. n this chapter The cost of playing the Appillionaire game is theoretically low It s just 99 to join up as an Apple developer The real expense is the investment of your time or paying people s salaries Over 250 million is spent at the Apple App Store every month And it s just the start The mobile software industry is witnessing explosive growth Even successful developers recognize an element of luck is involved in building a hit app There are few guarantees Apple has complete editorial control over what goes on the App Store The Appillionaires have to work within the bounds of what Apple considers acceptable material for sale both technically and morally 16 Appillionaires Secrets from Developers Who Struck It Rich on the App Store Hysterical venture capitalists are investing huge amounts of money into the app scene right now There couldn t be a better time to seek investment for your grand scheme Just make sure you have a back up plan in case things turn apocalyptic they probably will Now you know the basic geography of the Appillionaire s universe lets take a trip through the door of the world s most mysterious alluring and nonsensical shop The Apple App Store
14. nd yesterday explains Mills He said to me You re an app man I ve got an idea for an app I just don t know what to do Should I patent it Mills sighs I said What idea have you got Then he told me he wanted to go half and half So I would make the app based on his idea and hed make half the money Mills slams the table with his fist in anger I couldn t even answer him What s the point Mills is clearly a man who has been pitched apps way beyond his tolerance point It seems that no sooner does a developer mention that he or she is in the app business than a crowd gathers and starts pitching app ideas or asking how much he or she has made on the store In this sense the App Store increas ingly does resemble a gold rush It might be this overwhelming popular ambition to create apps that has caused a cynicism to take root Tristan Celder whose company Zolmo created the phenomenally successful Jamie Oliver 20 Minute Meals app represents a growing number of developers who think that the gold rush is now largely a myth perpetuated by the very developers who appear to be the richest There s a lot of hype surrounding apps that Google and Apple are very good at manufacturing explains Celder To be Apple s App of the Week looks like a stream of gold but doesn t always come to fruition There s a lot of young companies start ups that are trying to inflate their own value to get in
15. ses have heard the apocryphal tales the rags to riches stories and they want to live the dream too They wear Angry Bird T shirts and they tell each other increasingly ridiculous stories about the lavish houses of the program mer who built the wildly successful ishoot app They draw game plans for world domination using Sketchbook on their iPads But what is often forgotten in the telling of these capitalist parables is that few Appillionaires were true overnight successes As Mills tells me of Angry Birds People say it was an overnight success Well yes it was an overnight success after 52 other failed attempts WHERE WILL THE MARKET TAKE US Then there is the new wave of app makers They re thinking bigger and they re better financed some might say ridiculously financed Apps like Color which cost 41 million to launch shocked the industry by demon strating just how much raw cash investors were willing to throw at the mirage but it was just the beginning By April the creators of an iPad app 12 Appillionaires Secrets from Developers Who Struck It Rich on the App Store called Flipboard a social magazine had managed to raise an investment of 50 million valuing the company at 200 million It s a staggering amount Flipboard is a free app and though it dances around the very top of the iPad chart at the time of writing it provides no tangible income for the company that built it More worriesome still
16. towards the Appillionaires The App Store is also unusual and unpredictable because it s a hugely significant distribution method for the creative arts but it s controlled by a single all powerful god Apple Inc The company decides what is and isn t allowed to be sold in the App Store Although critics like those who work for The New York Times initially warned that Apple s censorship of apps would discourage developers from spending nights and weekends working on new and useful applications in the end it seems to have had little effect other than to reassure consumers and generate even more publicity for the iPhone and iPad Chapter 1 Introduction 7 World of Goo in action This deliciously addictive physics puzzler has sold millions of copies SOURCE Copyright 2D Boy Ltd Since the opening of the App Store there have been a litany of complaints and high profile criticism of Apple s policies These reached a crescendo when Trent Reznor of the band Nine Inch Nails reacted to a rejection notice from Apple on the grounds that his app contains objectionable content In reply Reznor wrote Thanks Apple for the clear description of the problem as in what do you want us to change to get past your stupid standards Apple accepted the app a few days later refusing to comment on what had changed its mind 8 Appillionaires Secrets from Developers Who Struck It Rich on the App Store THE APP COMMUNIT
17. vestors so they re happy for that hype to be there But whenever someone isnt releasing download numbers you have to wonder what s really going on Chapter 1 Introduction ITI WHY WROTE APPILLIONAIRES As you prod deeper into the world of the Appillionaires the water gets increasingly murky and that s precisely the reason I set out to write this book Many of the people I ve interviewed for Appillionaires have expressed confusion about the reality of the App Store despite their massive successes First this book sets out to answer the biggest question on the technology scene today What does it take to make a million dollars on the App Store However I also wanted to discover more about the other side of the App Store Those who have struggled to find success It s this other side to the Appillionaire story that is almost more intriguing The strange disparity between the amount of money actually made on the App Store and the public perception of the App Store as a goldmine I wanted to discover first hand if the Appillionaire dream was as widely realized as it appears to be And if it is indeed a rarity how has the illusion of probable success been so widely and effectively spread by the mainstream media This impression of easy riches has been bolstered by newspapers and magazines which seem to lap up every minor App Store success story with a mesmerizing eagerness Apps have gone mainstream pop culture even The mas
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