Sub Club by RevenueCat

While in college Zach built Hashtag Expert, an app for finding top-performing hashtags. After growing it organically for a bit, he started doing paid acquisition and quickly scaled it to hundreds of thousands of dollars a month in revenue. You can see exactly how much Zach spent to grow Hashtag Expert to that level because he publishes an interactive dashboard that shows the past couple years of income and expenses. Zach is now writing an email newsletter on his process of building a new app business with the goal of earning $100k in profit within the first 6 months.In this episode, you’ll hear about:(2:28) How Hashtag Expert was born.(7:58) Reporting in Facebook ads; Zach’s ad strategy as a bootstrapped app company.(19:40) Pricing and paywall placement experiments; the elastic demand curve; Jake Mor.(35:10) Zach’s latest project: a meal planning app that helps with weight loss; Weight Watchers; MyFitnessPal.(41:11) The status of the $100k app challenge 3 months in.Follow Us:David Barnard: https://twitter.com/drbarnardJacob Eiting: https://twitter.com/jeitingZach Shakked: https://twitter.com/zachshakkedQuotes:“[Hashtag Expert] definitely changed how I think about branding an app. If you make an app, it should have one really good functionality. And then if you want to build another piece of functionality that’s similar but not exactly part of it, then separating it out into its own app can be another way to get way more users because you have a whole new set of organic traffic to get.” - Zach“If you get somebody on a subscription, you know that they’re willing to pay, and so then you can push those to all your other subscription apps. It’s a smart strategy.” - David“[With paid ads] you’re basically building a money-printing machine. Even if you’re at break-even, if I pay $10 to get somebody and they spend $10 and I don’t profit immediately, the next year or the year after, I could make money. And that just allows you to build a substantial revenue monster.” - Zach“If you had a machine where you could literally put in one dollar and get back two, how much money would you put into it? Literally every dollar you had! Once that clicked in my head, I started spending on ads a lot.” - Zach“Something about showing the product as like, ‘Hey, this costs money; this isn’t a free product’ — that changes how people view it. It’s like, “Oh, OK, I have to pay for this.” - Zach“Meeting people where they’re at and giving them more options to pay, I think, is compelling.” - David“The narrative that subscriptions in general are a way to trick users into paying more money is, I think, more and more not becoming the case.” - Jacob“That’s a really savvy thing, I mean, outside of app businesses in general. Validate — just get some validation, some heat.” - Jacob“I think sometimes entrepreneurs can get caught up in themselves and believe some demand exists for something because they care about it — but you really have to take that extra step to be like, ‘Are there 10 other people I can find that also care?’” - Jacob“There are dozens of different use cases for every app, and if you’re at scale advertising and you hit a ceiling and you’re trying to unlock additional channels for revenue, then [multi-channel optimization] is naturally the next point.” - Zach“I never saw somebody being super, ultra-transparent about how they’re doing things — like literally documenting exactly how they named their app and exactly how they think about an app idea. There’s a lot of high-level advice out there but not a ton of micro, super focused, super transparent advice.” - ZachLike this episode?Subscribe to Sub Club on Spotify or Apple Podcasts to get the latest news on mobile subscription apps.

Since Apple’s big announcement about upcoming privacy changes in iOS 14, mobile app developers have been scrambling to understand how these changes will affect their businesses. With IDFA effectively dead in the water, developers will no longer be able to use device-level attribution and high-resolution tracking to send targeted ads to their users. So what can they do?In this week’s episode, we asked mobile marketing expert Eric Seufert for his take. Eric has had quite a career in mobile. From VP of user acquisition at Rovio to his recent consulting projects with subscription app companies, Eric has a depth and breadth of experience with mobile apps and games that few can match. He’s also a prolific writer. He wrote a book on freemium economics and has written hundreds of insightful articles on his site Mobile Dev Memo.In this episode, you’ll hear about:(1:07) Managing user acquisition at Rovio; freemium app dynamics at scale.(6:30) Why it’s hard to determine the effect of a specific ad channel; holdout testing.(9:10) The difference between mobile and traditional advertising: response time; Pepsi Super Bowl ads.(22:10) Why Eric doesn’t like the term “user acquisition.”(31:00) Why post-IDFA is more work for advertisers but provides a bigger opportunity.(37:43) How App Store changes have shaped the entire mobile app market; Top Charts.(44:25) Prediction: SKAdNetwork changes will most likely go into effect this January.Follow Us:David Barnard: https://twitter.com/drbarnardJacob Eiting: https://twitter.com/jeitingEric Seufert: https://twitter.com/eric_seufertQuotes:“When you’re spending a lot of money and you’re showing a person five ads a day, incrementality is critical in figuring out how much value did this particular ad contribute? … That’s the more interesting question because when these budgets get really large, you get these signals coming from all these different mediums, and figuring out which of those actually drives value is more important.” - Eric“That’s what’s so interesting about the mobile ecosystem: that immediacy, that kind of lack of friction.” - Eric“Just doing the fun clicking around Facebook Ad Manager, that’s not performance marketing. That’s advertising operations or something.” - Eric“Google’s always going to tell you to spend more money. Whatever question you ask Google about improving your performance, it’s like, “Oh, just pay more money!” - David“These systems were designed to sort of alleviate that need, on the part of the advertiser, to not have to have this big team of data scientists working on these models. Like, “Hey, we’ll do it for you!” And to be honest, Google could do it better than any individual advertiser could — it’s Google. And just the fact that they’re syndicating all that data across all these different advertisers, they just have more data than any single advertiser could. And that’s a good thing.” - Eric“This is something I think Apple has failed at since the very beginning of the App Store: understanding the way their individual, seemingly small decisions end up shaping the entire market… Now we have SKAdNetwork, we have one ConversionValue, you can’t update it in the background, you can only do it once, it has these weird timers… the entire market for apps is going to reshape around the shape of SKAdNetwork versus it having been shaped around the existing tools.” - David“There’s billions and billions of dollars being generated in the App Store, and it’s such a tiny little market, so people put in the effort to find ways to game, to maximum advantage, any point of leverage that Apple gives them. So now people are poring over the SKAdNetwork documentation just trying to find ways of like well, “How can I best use ConversionValue?” It will shape the design of apps. It’s going to be a totally new design paradigm.” - Eric“I just get really scared because ultimately if [Apple gets] it wrong, we’re gonna see apps moving in a direction that just is for them to extract the most value across the ecosystem and not necessarily provide great experiences for each user. I think lower resolution tracking, in this sense, actually can lead to that.” - JacobLike this episode?Subscribe to Sub Club on Spotify or Apple Podcasts to get the latest news on mobile subscription apps.

In This EpisodeApple recently shocked the App Store developer community with news that small developers with revenue of less than $1M per year will pay a commission of 15% instead of 30%. Within hours of the news dropping, David and Jacob recorded this episode with the hottest of takes, exploring what this means for the future of the App Store.Here's what we cover in the episode:(1:32) Is this a good thing or a bad thing? (For once, David takes the cynical view!)(4:39) 97% of developers using RevenueCat qualify for the program.(7:13) What this means for ad spend, CAC, and LTV ratios.(9:26) Doing the math: How much of a difference can this really make?(14:16) 97% of developers are affected by this change — representing only 5% of all App Store revenue.(18:56) What happens if you cross the $1M revenue threshold?(26:00) The $1M “magic number”; the 85/15% split.(36:35) How Apple could help different types of businesses succeed in the App Store; Kindle.Follow Us:David Barnard: https://twitter.com/drbarnardJacob Eiting: https://twitter.com/jeitingQuotes:“Indie developers can hire out more things, like customer support. You can afford to do a lot more as a small developer and spend on tools and services and help and designers — there’s so much you can spend that money on that will improve your product, that will help you build a better business, that will lead to more innovation.” - David“What this does is it make small developers more competitive in the bids because we can spend more, so on the ad spend side of things, I think it’s a huge boon to smaller developers.” - David“I still think that the App Store economy generally is more limited on innovation not because of money but because of App Review. VCs are making decisions whether to fund or not fund a mobile company based on App Review, not the 30%. VCs recognize that the marginal costs of digital goods and services is zero. So you can stomach a 30% tax on zero-marginal-cost goods, if you can build a great product.” - David“From a more strictly innovation standpoint, it’s not the money that’s limiting innovation — it’s Apple’s stranglehold on what can and can’t [succeed in the App Store].” - David“I do think this is in some way, the perfect non-action for Apple.” - Jacob“We have to keep asking for the things that developers need, and making more money is always good! That's our mission at RevenueCat; I'm always a fan of that. - Jacob“This is a step, it’s something, and it's not insubstantial. And it's well targeted and well thought out.” - Jacob“Apple gave us a raise!” - David“Ultimately I think all these things that [Apple] could do — like changes to App Review, creating a program to reduce the App Store fee for businesses who can't make it work — all those things ultimately benefit Apple in the long run. As developers are more innovative, as more apps are able to be on the App Store, as the platform grows, they're going to make even more money. So it’s a win all around.” - DavidLike this episode?Subscribe to Sub Club on Spotify or Apple Podcasts to get the latest news on mobile subscription apps.

Starting a mobile-first subscription app business can be tough — there are a lot of decisions to make. Should you bootstrap or raise investor funding? How will you classify your business? When is the right time to monetize your app?Fortunately, you don’t have to go it alone! One of the best ways to chart your course is to learn from the experiences of developers who’ve been through the process before. And one of the best ways to do that is to go through an accelerator like Y Combinator.This week, David and Jacob caught up with Jake Mor to find out how he navigated the process of building a subscription app from the ground up. Jake is the founder of FitnessAI, an app that builds personalized weight lifting plans to help people achieve their goals without having to hire a personal trainer. The app was released in early 2019 and quickly grew to over $85k in MRR! Based in part on that growth, FitnessAI was accepted into the Y Combinator Winter 2020 batch and raised a seed round coming out of demo day.In this episode, you’ll hear about:(4:38) Jake’s first accelerator experience; co-founding Shopturn and going through Techstars.(8:44) The fitness app opportunity: market size, structured data, and machine learning.(13:20) Pricing experiments; users are willing to pay more than you think.(18:53) Scaling ad spend; what Jake learned from his first $20k.(19:02) The importance of mentorship; Bryan Welfel; JSwipe; The Beard Club.(22:15) Pro tip: Put your ad spend on a credit card to sync up with Apple’s payment schedule. (But be very careful to manage your debt!)Follow Us:David Barnard: https://twitter.com/drbarnardJacob Eiting: https://twitter.com/jeitingJake Mor: https://twitter.com/jakemorLike this episode?Subscribe to Sub Club on Spotify or Apple Podcasts to get the latest news on mobile subscription apps.

We’re at an interesting point in the evolution of the subscription app ecosystem. Mass adoption of smartphones, consumers’ increasing willingness to pay for digital services, and a better business model — Personal SaaS — are all coming together to create a huge opportunity for mobile-first subscription app developers. Just how big is this opportunity?(Full disclosure: Nico is so bullish on the future of subscription apps, he recently invested in RevenueCat!)In this episode, you’ll hear about:(4:10) The formula for a breakout SaaS business: engaged users.(5:00) Stickiness, engagement, and churn: B2B SaaS vs. consumer app businesses.(6:56) Identifying nascent markets before they become mainstream; meditation apps (Headspace & Calm).(14:00) The lines between consumer and business use cases are getting blurry.(19:51) We’re in the early stages of figuring out subscription app pricing; Salesforce.(24:46) Pricing your subscription app: balancing adoption, data collection, and user price sensitivity.(39:55) Increased mobile spending and subscription fatigue.(48:26) Sophistication of today’s apps and technology; Oura ring.Follow Us:David Barnard: https://twitter.com/drbarnardJacob Eiting: https://twitter.com/jeitingNico Wittenborn: https://twitter.com/ncsh

Welcome to the Sub Club podcast: a deep dive on building and growing subscription app businesses. Hosts David Barnard and Jacob Eiting will guide you through the ins and outs of subscription apps — sharing insider tips, predictions, and insights from industry experts.In this episode, you’ll hear about:(00:58) Meet your hosts David Barnard and Jacob Eiting.(05:11) Sub Club is the first podcast focused on subscription apps.(05:15) Personal SaaS is a nascent industry.(6:18) The first billion-dollar mobile subscription companies; Lightricks, Calm, Headspace.(16:50) How to submit feedback and suggestions for the Sub Club podcast.(37:19) New platforms and form factors; AR(44:15) The “AWS-ification” of mobile app development.Follow Us:David Barnard: https://twitter.com/drbarnardJacob Eiting: https://twitter.com/jeiting