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Building the Ultimate iOS Source Store

When I quit my employment as Windows system administrator in December 2009 I had already been developing iOS stuff for 2 years. At that stage I had to define what my business should be comprised of and I decided on a multi-pronged approach. I simply lack the design capabilities and ideas to sustain myself on apps alone.

The Past

One of the multiple streams of income that a holistic iOS business can generate are sales of software components. Often there’s a functionality that you wished Apple would provide or made simpler to use but you lack time and expertise to write such a component. And you lack funds to hire a professional at a rate of several hundred dollars per day. What if you could share the development cost with dozens of other fellow developers? The pro would still get payed, but you trade exclusivity for availability.

This is what I created my Dr. Touch’s Parts Store for.

Often I get asked, how this is going for me. Here’s my first go at answering that: pretty well! I’ve been doing that for 7 months now, which provides a bit of data that we can slice and dice. Also I’ll tell you about the present state of affairs as well as present to you my vision of the future: The Ultimate iOS Source Store.

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Microsoft Wooing iOS Developers

Yesterday I found an e-mail in my inbox that gave me a bit of a spooky feeling in my stomach. Ordinarily such a mail would have quickly ended up in my trash if it weren’t for the details they put in there.

Why would Microsoft be contacting me? They obviously did a bit of digging or reading to know that I created the apps for CCS Publishing. They didn’t bother to check on my references page though. The ACLS app was done by somebody else. But still it shows a fair amount of data mining as they appear to have checked those apps’ rankings and then cross referenced them with who was the real author.

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4 iPad App Makers Share Their Development Experiences

Having some contact with developers around the globe allows me (and by extension YOU, my dear reader) a glimpse of what kind of apps are going to become available with the iPad on April 3rd. More importantly, we can ask those busy developers – who struggled to be first in the launch line-up – what they thought were the difficult steps in designing and building iPad apps.

Being the good soldiers that we are, we let them have the glory from being first while being able to learn from the problems that the one or other Apple mine would have caused them. Maybe this way we can save ourselves some grief and frustration if we can avoid their mistakes from the get go.

So here are 5 of the first iPad apps and what their developers learned from making them.

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Q&A with iPhone Business Owner Selling for $100,000

Brice Milliorn

After I had laid out my analysis about Brice Milliorn offering his iPhone Apps Portfolio for sale on eBay, I got contacted by the owner/seller himself. He offered to respond to any deeply probing questions I might have. Journalistic curiosity got the better of me and so I constructed the hardest questions that I could think of.

Here are his answers, verbatim and unedited.

1. You claim to produce 86% of your income from the USA, yet none of your apps appear in the top 100 in any category there. What is your explanation for this?

There are 100,000 apps on the app store and my apps pop in & out of the top 100 from time to time. Also obviously a Top 100 is only a 0.001 percent of the total app store product mix, considering there are 100k apps out there now.  So just because you don’t show up in the Top 100, doesn’t mean you don’t sell a lot of apps.  And furthermore, it is good that my apps are being recognized internationally as well.

2. If your business is still growing (and would grow more with “proper marketing”) how do you explain the steep decline in average royalties for the past 30 days compared to the 60 or 90 days range?

Lack of marketing, lack of updates, lack of attention, and o’yes 100,000 apps on the app store!

3. You say “a person who can market them will have much better results”. How can you predict that if everybody knows that after an initial sales spike there is only a long tail to farm on?

Marketing 101, see below.

4. What’s your factual foundation to claim that “the numbers may be better” as a sales argument?

Marketing 101, and I know this because the spike in sales that you saw (see charts on link list at bottom) was because of the little marketing that I did have time to do. Also a lot of these apps can have focus marketing, meaning they deal with certain areas of the US, so marketing can be focused on that area or that segment of people (i.e. College Students).

5. How did you yourself arrive at the number $100,000?

  • Well I like what I am doing, don’t have much time but still like it, for me to give it up, a big number would need to be paid, 100k is that big number.
  • However when valuing the business, I think it is a small price to pay. When you value real estate you look out 5-6 years. If you take my sales and look out only 2-3 years, this business will pay for it self easily.
  • I also arrived at this number by looking at the two previous cases that I know of (see below for 2 example cases in question #10) of iPhone developers selling their business and after talking to them about their situation.  These apps were sold between 5k and 10k each, I am selling 87 apps for 100k, that is $1,149 each.

6. Currently it is unlikely that you will find a buyer. Small guys don’t have the money. Big guys don’t see an audience. What’s your plan B? Would you also be willing to only sell shares of your company to interested investors? Like $10,000 to get 10% of your monthly royalties would be around 36% annual interest.

I wouldn’t say I won’t find a buyer? I have had over 100+ emails inquiring about it further and there are 70+ watchers on ebay right now. My website has had over 3000 hits in just 3 days, the ebay auction has over 3000 page views as well. I have no plan B. Like I said above, I like what I do and to get me to sell it would have to be a BIG number. Not willing to sell shares of company. 100k, take it or leave it.

7. Or how about only asking for a certain percentage in cash and getting paid a percentage from royalties over a certain period?

Again, not willing to do this, 100k take it or leave it, I enjoy what I do.

8. There is a guy named Joe Madox who is seemingly interested. When defending your offer it sounds like he has already made up his mind to try to come up with the sum. Or is a friend of yours?

This guy has asked a lot of questions, more than anyone. He owns a publicly traded company. He was thinking about paying me in shares of his company. I declined, cash only.

9. You are saying you’re selling “your business”. Does this include the legal entity plus bank accounts belonging to it? What’s this “collateral” you speak of?

Selling the assets of the company, meaning the 87 apps, not the name of the LLC or the LLC itself, little confusing I realize.  The collateral is all the source files, the website files, images, everything the user needs to run these apps and update these apps and completely relinquish these apps from me!  No bank account b/c not getting the LLC, just getting the apps themselves.

10. Based on what legal foundation do you think you can sell your business at all? Sure you can sell a corporation, but how does Apple deal with such a sale?

I am selling my programs, not Apple, not my LLC. There have been previous developers who have sold their business fine, I contacted them to ask questions, got a response from them, said everything went smoothly. Here are those two examples…

Example 1:

http://cgi.ebay.co.uk/Top-Tens-iPhone-app-source-code-and-website_W0QQitemZ260457053112QQcmdZViewItemQQptZUK_Computing_Software_Software_SR?hash=item3ca4733bb8&_trksid=p3286.c0.m14#ht_946wt_1167

Example 2:

http://blog.secondgearsoftware.com/2009/10/bitbq-acquires-fitnesstrack-emergency.html

11. How big is the business risk of your news providers cutting your sports-related apps off?

Well I have fended them off so far but there are a lot of hoops to get around with these apps, a new person starting these types will take weeks and weeks of trial and error with Apple before it ever gets approved.  There are also other news providers I could always use I am sure.

12. In Summary I must say that you are doing a very bad job at presenting your business as something worth purchasing. Anybody who has the money to spend on your company also has the financial sense to want to see a good business case. You fail to present it. We all don’t know what will be in 3 years. Apple may still dominate the Smartphone market. Or it may not. And also coming out of the crisis it has become extremely hard for anybody to get a loan for 100k for a business.

I think we all know, the only company to better the iPhone, is Apple. And the economy is/was bad but there is always someone with more money than they need looking for a golden opportunity.

13. Therefore I suggest that you need help in 1) compiling the numbers in a more transparent fashion, 2) maybe even going so far as to providing the apps.db from MyAppSales for download (It does not contain login data, which is on your keychain), or a ZIP of your past financial reports. 3) formulating a plan B as outlined above.

I am NOT going to give out the individual numbers but I will break them down more. The reason I will not give out the individual numbers is because my best selling ones will then be duplicated.

These numbers are again from AppViz as of 11/07/09.

  • Rule book Apps 8,712
  • Sports Related Apps 12,479
  • Friday Night Lights, ANTZ, & iSpy 4,533

Any further questions can be direct to me at jbmjbm22@me.com.

Also further info can be found at the following redirected sites:

JBMJBM, LLC iPhone App Website

http://www.jbrice.com/iphone

JBMJBM, LLC Sell Page (with CHARTS)

http://www.jbrice.com/sell

JBMJBM, LLC Ebay Sell Page

http://www.jbrice.com/ebay

JBMJBM, LLC Press Release

http://www.jbrice.com/pressrelease

Why I won't purchase an iPhone Business for $100000 today

We’ve been reading about it on Twitter for the past 2 days, now even TUAW picked up the story of an iPhone Developer who wishes to sell his entire business for $100000. Leaving out of our consideration that probably nobody has this much money around anyway it’s still an interesting impulse to start thinking of how much your own iPhone business would actually sell at…. should you ever WANT TO sell it.

With the seemingly limited journalistic means of TUAW all the author came up with was some general quotes and rants. I dug a bit deeper and think it’s interesting to write down what I found in neutrally evaluating this offer. TUAW repeats the seller’s offer on how he will support you, hand over everything, yadi yadi yadi.

But we all are children of numbers and algorithms. So I think we deserve a little bit deeper analysis. This I will attempt in this article.

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