How To Make A Million Dollar App

The conventional wisdom is that ideas are everything. With the right or best idea it's only a matter of details to build the next million dollar app, therefore you should guard it and not tell anyone.

Startups are different. And it's 2018.

Keeping your app startup idea secret may work in traditional markets such as manufacturing or commodity supply. If you found a cheaper supplier of bananas for your local market – you're in good business.

The market exists, you're cheaper and provided your product is good, a better price is the only thing that matters. You obviously wouldn't want to share the name of your supplier.

Technology startups are different. Startups are about innovative products, business models, and markets.

They either launch a product that nobody has ever used before or they offer a new business model that has never been tested. In many cases, the market can be entirely new with no guarantee of continued growth, e.g., flat sharing in AirBnB's case.

Startups are about innovative products that no one is using yet, new and unproven business models and markets that didn't exist before.

It's all about execution

If you built a new unique technology, e.g., longer lasting batteries that can be shipped immediately, you should get a patent. Otherwise, it all comes down to execution. Many people claim to have invented Facebook but none of them built an engine of growth, closed deals with investors worth billions of funding, and pitched and convinced hundreds of top people to join an unknown startup.

Besides, Friendster launched years ago only to be considered a failure.

Having the best app idea is, unfortunately, almost worthless.

Invention is the least important part of innovation

In fact, most of the successful startups were not new ideas but rather an improvement on existing technology. E.g., iPhone (PDA's), Tesla (electric cars), Google (some 20 search engines), Apple (Altair), etc. So why is it that Yahoo, Altair, Nokia and many others failed to their counterparts who didn't have a unique idea and were late to launch? It all boils down to distinction between invention and innovation.

Most people perceive innovation to be a synonym with invention. According to p. Ahlstrom and N. Furr, authors of NISI the first step to defining innovation is to separate it from "new" and "invention" – in reality inventing "something new" is the least important part of innovation. By their definition innovation is when invention meets the market need.

The reason why Apple Newton failed and iPhone succeeded was that both a) technology evolved to meet customer needs (internet, mp3 etc.), and b) the market needs evolved to the point where customers found adopting iPhones easy.

Same can be said of Tesla – one of the unmet needs of electric car users was sufficient range. Or Google – users were bothered by all the ads and clutter on competitive sites, so when Google came to existing market of search users they adopted it fast because of the clean and fast homepage.

Your initial app idea is likely a failure

Mobile app startups are really hard.

11 out of 12 startups fail according to Startup Genome project that compiled data of 50,000 startups in tech/web/mobile space. Those odds point expose the myth of the million dollar app. The reason they fail is that there is simply way too many variables in bringing something nonexistent to the market or doing something in a completely new way.

It's simply not selling bananas to someone who already knows and eats bananas daily.

Yes, you may have the best app idea. But probably not at first.

In addition to complete uncertainty, startups have limited budget and limited time to succeed. According to Clay Christensen, who coined the term "disruptive innovation" in his classic Innovator's Dilemma, the startups that did succeed are those who had enough money to try their second idea. Likewise, Paul Graham from Y Combinator states in one of his essays that for typical YC startups, 70-100% of the idea is new at the end of the program.

Instagram started as Burbn, a Foursquare knockoff; Pinterest as "Tote" and e-commerce startup. Shopify was an eshop for snowboarders, Youtube a dating site, Twitter a podcasting company, Paypal changed direction 5 times and we can go on.

If you have a business idea, the chances are you are wrong in your assumption, the only way to find out is to test it in the actual market and start removing the variables soon. So in a twisted way, the key to getting your developing your idea to app store-ready is falling on your face before you get there.

The reason 11 out of 12 startups fail is that there is simply way too many variables in bringing something nonexistent to a market or doing it in a completely new way.

Nobody is going to steal your idea

As discussed above, app startup ideas are cheap – everyone has a million dollar idea with business potential (if executed properly). There is only a fraction of people who are willing and able to put the work, risk and execute and these people have their own great ideas.

Most of these people actually prefer to work on their own ideas – that's because their ideas are usually connected with their own domain expertise, experience and usually their passion. They don't lack great ideas and they don't pick random stuff from someone with little relevance to what they do. These people are harmless but can be very beneficial in providing feedback. And you need feedback, a lot of feedback.

If you share your idea, capable people can point you to the right direction, they can provide tips and connect you with others who may help or even get you a customer. That's what entrepreneurs do between themselves.

Everyone else you talk to should be your potential customer. Want to build an iPhone app? Talk to the people in your target market — asap — and that goes without saying. They won't tell you what to build but they will tell you if you're solving the right need.

If you keep your idea secret, you will live in your own illusions with limited options to execute it the proper way. Life is short, don't waste your time and money.

App ideas do get stolen and yours will too if it's any good

When ideas do get stolen it's usually after they are a proven success. Wozniak offered first Apple computer to HP and they laughed, just make a copycat few years later. Nobody copied Groupon in early days, it was only after it became a massive success when Google, Amazon and everyone else started to copy them.

Nobody likes risk and therefore nobody is going to be interested in your idea before it's proven. In fact people will likely think your idea is stupid until you prove them otherwise. Once you do that, there won't be any point of hiding it because everyone will know anyway.

Once your idea becomes a success, that's when everyone starts to be interested.

Throw away your NDA when talking to investors

No serious professional investor will sign any kind of NDA, and asking one to is a hallmark of an amateur entrepreneur. 99% of ideas have no actually secret content, and the rest can be discussed meaningfully without revealing the secret sauce. If your idea is any good, someone is already working on it and since most investors talk to hundreds of startups with competing products so they won't sign anything that would prevent them investing in other startups they may find have a better team or so.

Whether it's for an Android or iPhone app, add-on or completely-from-scratch mobile app, validate your idea as quickly as possible.

How to Generate New App Ideas

Execution is king, but every great app had to start from somewhere. These three steps will help you create and validate ideas that could become your golden ticket.

1. Start with a real problem

Contrary to popular belief, the best apps in the market are not centered around the latest and greatest technologies. Sure, augmented reality is a neat trick, but does anyone really need to put a dog nose on their face?

Observe what happens in your daily coming and goings, as well as that of those around you as well. What are some prickly issues that you might be able to solve with an app?

A great example is save-for-later service Pocket, which serves some 20 million registered users. In 2007, this solution was born out of founder Nate Weiner's simple need to save articles which he didn't have time to read. 4 years later, he received an acquisition offer from Evernote "in the low millions," which ultimately didn't go through.

Another 6 years from then, however, Pocket was acquired by Mozilla.

Not finding much inspiration in the world around you? Another way to find problems to solve is to browse websites such as ProductHunt and Indie Hackers. Here, makers and founders publish their newly created products and projects on a daily basis, each attempting to solve a particular problem.

You might even want to take a look at the most popular apps in the market today, and see if you could apply them to a different industry, or a niche audience who might be in need of it.

Generally speaking, have a look at the problems they're all trying to tackle, and see if you could find a different angle or do it better. Consider performing a SWOT analysis to see if there are any gaps you could plug, or pain points you might be better equipped to solve. Spoiler alert: you probably can.

If all these lead to dead ends, try looking within yourself instead. Keep a journal to record your day-to-day activities, and throw ideas in – no matter how crazy they may seem – as they occur to you. Ideas come to us at the most unlikely of times, such as when we are in the shower, or just about to go to bed. Be diligent about recording them, or you might hit upon a winner eventually.

2. Share your app ideas with friends, family, and anyone who will listen

Have a bunch of ideas in your notepad? Great – but don't get started on developing and designing them just yet.

Instead, share some of your app ideas with literally anyone who'd be willing to listen to you. Most of the time, that would be friends and family, but it's great to share them with strangers who would not be afraid to criticize them as well.

Why go through all this trouble? As human beings, we rely on our brains for many of the decisions and actions we make everyday. While our brains are pretty powerful, they have their limitations as well, the biggest of which is that they're pretty lazy.

The result: our brains often try to simplify information processing, which create cognitive biases in our judgment and thinking. Because of this, it's always better to seek other people's opinions on your app ideas to overcome any personal biases you might have.

Again, don't worry about anyone stealing your idea. The value of getting feedback from others to validate your initial ideas far outweighs any potential competition.

From here, you should be able to narrow down to at least one product which generally seems viable. Time to make it, or break it.

3. Make a Minimum Viable Product

Is it time to start hiring a team to developing your million-dollar app? Well, not quite.

A huge mistake that many first-time founders tend to commit is, well, over-committing to an idea way too early. You might be able to raise a few million dollars and build a working product off the back of a hypothetical idea, only to find out that no one actually wants to use it. By that time, it'd be too late to turn back.

It is far more prudent to quickly roll-out a Minimum Viable Product (MVP), and get some feedback based on that first. An MVP is defined as "a new product or website is developed with sufficient features to satisfy early adopters."

What this does is to test the core assumptions behind an idea, with an audience that tends to be more forgiving of shortcomings (at least at this stage) and more likely to give you valuable feedback. In other words, a safe environment for you to play around in.

In some cases, it might take as little as 20 minutes to get an MVP created and sent out into the world, such as in the case of Product Hunt. According to founder Ryan Hoover, here's all he did:

"I logged into Linkydink, created a group, and invited a few of my startup friends to contribute. I wrote a quick blog post, announced the project on Quibb and tweeted […] Within 20 minutes, I had an MVP."

It might be tempting to just dive into the deep end and just start coding. Don't. Buffer founder Joel Gascoigne was an almost-culprit, but held back thanks to some wise words from lean startup methodology advocate Eric Ries:

"I found that practice is much harder than theory. I even started coding Buffer before I'd tested the viability of the business. As soon as I realised that, I stopped, took a deep breath and told myself: do it the right way this time. It was time to test whether people wanted this product."

In Ries' guide to Minimum Viable Products, one of the key things he answers is "how minimal should your Minimum Viable Product be?" Here's his answer: Probably much more minimum than you think.

In this case, slow and steady wins the race. Create an MVP, send it to the same people who you had previously asked for feedback, and get a feel for whether people would want to use your app or not.

Once you've drilled down to a list of things people like or don't like about your product, you can now double down on those points with confidence. Do note that this isn't a one-off process – you should be constantly trying to assess what is the true value of your product, and fine-tune it along the way.

To further validate your idea, you might want to consider getting people to "vote with their wallets." In other words, slap a price onto your MVP that you think is reasonable, and see if anyone actually pays for it.

As Basecamp founder Jason Fried puts it: "People answer when they pay for something. That's the only answer that really matters. If people buy that's a yes. Change the price. If people buy, that's a yes. If people stop buying, that's a no. Crude? Maybe. But it's real."

Entrepreneur Ryan Robinson explains why validation is extremely important to the process:

Validation is designed to give you you reasonable certainty your business will have a sustainable, growing, paying audience in a matter of days or weeks, rather than wasting months or years building a final product nobody will pay for.

And isn't that one of the greatest fears of an entrepreneur – that you'll spend a huge amount of time creating something, only for no one to actually use it? This process of creating an MVP and validating it will help to alleviate some of that fear.

Feeling confident that, if you launched your app tomorrow, people would actually download it?

Then you're ready to get going.

Should you develop your app on iOS or Android?

While there are a ton of smartphone brands in the market out there, the critical question for app developers always comes back to this: iOS or Android?

Why does this matter? Simply put, the user demographics for both platforms are vastly different. Accordingly, you will want to consider which audience would best fit the app idea that you had in mind.

In terms of market share, Android apps are pretty far ahead of iOS. Despite Apple's new, flashy range of iPhones and iPads, people seem to be turning towards Android instead, with the latter currently owning around 85 percent of global market share.

As such, if you're looking to reach a larger audience, Android would likely be the way to go. This is especially so if your app targets the tech enthusiast market, as Android users tend to be more "techy" by nature.

In addition, if you want to target emerging markets such as Asia or South America, Android would also be the better choice due to its low cost smartphone options, which make them more affordable and hence more attractive.

On the flipside, if you're looking to generate revenue from your app — using monetization models such as in-app purchases or subscriptions — then iOS might be the way to go. According to a report by app analytics company App Annie, the iOS App Store earned 75 percent more revenue than the Google Play Store.

Also, iOS app development cycles tend to be shorter than Android's – largely because there are just so many different kinds of Android devices – which means you'd be able to get it out there a lot faster if you go with the former.

14 examples of app ideas

Here are some of the most interesting app ideas we gleaned from the very creative and clever Startup Ideas Reddit and IdeasWatch communities — plus some of our own:

A chat app that matches two strangers with opposite opinions about a certain topic
A matching service for people looking to maximize spending on a rewards credit card with people who need to make a purchase
A graphical restaurant reservation system that will allow users to see exactly which tables are available when
A car park finder for the city
An alarm clock app based on peer pressure i.e. wake up or lose the money you put into the "pot"
An app that instantly sends a gift to your loved ones at an appointed date and time, so you never miss those important moments
A wishlist app that puts your list of most-wanted items and goals up for anyone to fulfill
An AI-powered app that can scan your ingredients and suggest a list of possible dishes you can cook from it
An Augmented Reality (AR)-powered app that allows you to "design" your room in real life, and then "buy" that exact same design from an interior designer or contractor
A language app that translates the spoken words of both parties in real-time, so that they can speak naturally with each other
A networking app that randomly connects you with people nearby to have a coffee or chat, based on interests or business needs
A budgeting app that analyzes your bank account, and books the best possible travel destination and itinerary based on it
A grocery app that keeps track of the expiry dates of the food inside your fridge
A game app that lets you play and compete with your Twitter followers to read the most books

Just do it

Not to discourage you, but the road to success is paved with the "bodies" of discarded iOS and Android apps alike. In 2017, the number of apps in the Google Play Store and Apple App Store numbered at around five million.

That's a ton of competition to overcome.

Still, coming up with a good idea is merely the first step in a journey that will definitely be exciting beyond your wildest dreams. And isn't that really what every entrepreneur is looking for – the thrill of making a huge bet, and bringing it slowly but surely to fruition?

We hope that this article has encouraged you to take that first step. The rest is up to you.

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