How to Build a Billion Dollar App

409 Pages·2015·2.7 MB·English

by  George Berkowski

‘A practical guide on how to start your mobile app company. A must read for
anyone who wants to start a mobile app business’ – Riccardo Zacconi, Founder
and CEO King Digital (maker of Candy Crush Saga)
‘The first book to take a detailed, insightful behind-the-scenes look at the mobile
app world. A must read for anyone who wants to know what it takes to build an
app into a successful business’ – Hugo Barra, VP, Xiaomi and former VP
Android Product Management, Google ‘George Berkowski knows from the front
line how to build fast-scaling digital businesses. Don’t start one of your own
without taking his advice’ – David Rowan, Editor, Wired magazine ‘A
fascinating deep dive into the world of billion-dollar apps. Essential reading for
anyone trying to build the next must-have app’ – Michael Acton Smith, Founder
and CEO, Mind Candy (maker of Moshi Monsters) ‘I loved this book. It
provides an entertaining and rigorous yet very practical guide to success in the
brave new world of mobile technology. I will never look at apps the same way
again’ – Bill Aulet, Managing Director of The Martin Trust Center for MIT
Entrepreneurship and author of Disciplined Entrepreneurship
‘George has combined his own experience at Hailo with a thoughtful study of
the iconic mobile companies of this era to provide a helpful guide to
entrepreneurs and investors trying to understand the emerging mobile economy’
– Adam Valkin, Managing Director at General Catalyst Partners
‘Distilling lessons from the leading mobile internet startups, George offers
unique insight into the app economy, the biggest and fastest wealth-creating
opportunity in history’ – Paul Forster, Co-Founder and former CEO, Indeed ‘In
his new work, George Berkowski delivers a compulsively readable business
book; it’s a rollicking yet rigorously detailed ride through the process of creating
a breakthrough app-based business. Berkowski’s engaging account of the rise of
the app economy provides an insider’s view on entrepreneurial best practices, as
illustrated by first-hand insights into the people – and their ventures – who have
triumphed by exploiting the mobile revolution. It’s a richly rewarding read’ –
Jeffrey F. Rayport, Faculty, Harvard Business School
Copyright
Published by Piatkus ISBN: 978-0-349-40138-6
Copyright © 2014 George Berkowski The moral right of the author has been
asserted.
All rights reserved. No part of this publication may be reproduced, stored in a
retrieval system, or transmitted, in any form or by any means, without the prior
permission in writing of the publisher.
The publisher is not responsible for websites (or their content) that are not
owned by the publisher.
Piatkus
Little, Brown Book Group
100 Victoria Embankment
London, EC4Y 0DY
www.littlebrown.co.uk
www.hachette.co.uk
To my parents, and Kasia
Contents
Copyright
Dedication
Acknowledgements
Preface
Part I: Think Big
1 The View from the Inside
2 Mobile Genetics
3 A Billion-Dollar Idea
Part II: The Journey
4 It’s Bloody Hard
Step 1: The Million-Dollar App
Building a Founding Team, Validating Your Product and Raising Seed Funding
5 Let’s Get Started
6 Solving the Identity Crisis
7 Getting Lean and Mean
8 App Version 0.1
9 Metrics to Live and Die By
10 Let’s Get Some Users
11 Is Your App Ready for Investment?
12 How Much is Your App Worth and How Much Money Should You Raise?
Step 2: The Ten-Million-Dollar App
Achieving Product–Market Fit and Raising Series A Funding
13 HMS President
14 Make Something People Love
15 New and Improved Version 1.0
16 The Metrics of Success
17 Getting Your Growth On
18 Dollars in the Door
19 Seducing Venture Capital
Step 3: The Hundred-Million-Dollar App
Tuning Your Revenue Engine, Growing Users and Raising Series B Funding
20 A Colorful Lesson
21 Tuning and Humming
22 Getting Shedloads of Users
23 Revenue-Engine Mechanics
24 Keeping Users Coming Back
25 International Growth
26 Growth is a Bitch
27 Money for Scale
Step 4: The Five-Hundred-Million-Dollar App
Scaling Your Business and Raising Series C Funding
28 Shifting Up a Gear
29 Big Hitters
30 Scaling Marketing
31 Killer Product Expansion
32 Scaling Product Development and Engineering
33 Scaling People
34 Scaling Process
35 Financing at a Big Valuation
Step 5: The Billion-Dollar App
The Promised Land
36 Unicorns do Exist
37 People at a Billion-Dollar Scale
38 Advice from Billion-Dollar CEOs
39 Getting Acquired
Notes
Index
About the Author
Acknowledgements
I’d love to thank the following people for all their help, input, opinions and
support throughout the process of creating this book: Tina Baker, Niqui
Berkowski, Samar Chang, Brad Feld, Jay Bregman, Steve Brumwell, Poppy
Hope, Michael Varley, Matthew Osborne, Dominika Dudziuk, Anthony Gell,
and my editor Zoe Bohm.
Preface
I
n early 2011, I had just completed the sale of my startup (a video-dating site
called WooMe.com) and was relishing the chance to take a few months off in the
sun, when I saw a cryptic post on a tech website from the entrepreneur Jay
Bregman and couldn’t help but get in touch. I shot him an email, met him in
person and found myself intrigued by his idea for a new mobile startup – an app
that allowed passengers to hail a taxi from their smartphone. But his approach
was fresh and disruptive (and in this book I’ll be using ‘disruptive’ to describe
something that brings about a step change, shakes things up a bit). It directly
solved the problem of how to build up a community of drivers before any
passengers were using the app.
From my very first conversation with Jay I realised that his vision for the
company was global – an app that any person could use in any language to catch
a taxi in any city in the world. I was sold. Jay needed someone with my
experience to translate his great vision into a concrete business strategy, to refine
the business model – and build the technology and software to turn it into an
app. And so, in early 2011, only a few weeks after the company was
incorporated, I joined the tiny startup as the Head of Product. The company was
named Hailo.
Since then it’s been a meteoric trajectory, growing from a handful of people on
the HMS President (an old warship transformed into budget office space which
bucks, rolls and creaks with the River Thames traffic) to more than 250 people
in 7 countries and hundreds of millions of dollars in taxi fares.
My experience at Hailo taught me a huge amount about what it takes to
achieve success on a huge, global scale and proved that anyone with a great idea
for an app-centric business has the potential to turn that idea into reality – and a
global success. This book is the first step to making that happen.
PART I
Think Big