AppBoard Tuesday – Why Do So Many Mobile App Startups Flop?

By | February 17, 2015
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Well, hello folks…and welcome to a brand new edition of AppBoard Tuesday (ABT) – the free weekly e-newsletter from Teknowledge. A few days back, while doing a bit of research, our team came across a very interesting stat – on average, nearly 3 out of 4 mobile app startups fail every year. A hint of nostalgia (back in the late 2000-s, we were also not much more than an ambitious startup) led us to deal with this topic in this edition of ABT. We will highlight a few things that new mobile app entrepreneurs should be wary of, to save their startup company from turning out to be duds:

  1. Do not let managerial responsibilities kill off your core skills – If you have decided to take the plunge in the mobile app business, chances are high that you are an expert developer yourself. Many new ‘bosses’ make the folly of committing all of their time for setting up their companies – leaving them with hardly any scope to do what they are actually good at (in this case, creating apps). Of course you need to be a leader of your team of developers – but addressing every employee grievance, conducting interviews, and related stuff are NOT YOUR PRIMARY RESPONSIBILITY. Your company should not put your core expertise in the shade.
  2. Make your products stand out, but not too much – One of the first things that you learn at your management course is that a ‘me-too’ product never works. The domain of mobile app development is not an exception to this rule of thumb. However, if you create a totally unique, never-seen-before sort of an application (and we have seen many such weird apps being released, and failing, every quarter!), failure won’t be far away. The idea should be providing excellent quality apps to clients that serve a precise, well-specified purpose – and are easy to operate too. Confuse your customers, and they will simply ignore your apps.
  3. Avoid the pitfall called procrastination – What is the single biggest peril for any mobile app company? We feel that the answer is ‘stagnation’. Of course you need to research about the SDKs of the different mobile platforms, the APIs, animation tools and other technical stuff – but that should not delay the process of development from being set into motion. Your company should have a Minimum Viable Product (think of it like a very basic set of apps) at the stores as quickly as possible. There are new app companies that take 9-10 months to come up with their first set of applications – and not surprisingly, the latter do not find many takers.
  4. Gather (and retain) a strong team of developers – Developers who are not particularly skilled and/or are still learning the nitty-gritty of programming would accept lower pay packages (an idea that most new app company bosses jump at). What is not taken into account is that, such developers also pull down the quality of the apps that are ultimately created. From the very outset, your focus should be on hiring people who are talented, have ample relevant experience, and are willing to learn. Do not stay in the thought bubble that app development (coding) and UI/UX designing can be done by the same person(s) – you need separate teams for separate, specialized tasks. If you are planning to get into cross-platform mobile development, form separate teams for Android and iPhone app development. In a nutshell, do not compromise on the quality of developers/designers in your company. Human asset matters most.
  5. Don’t lose your sleep over that thing called ‘first-mover advantage’ - In the field of mobile technology, being the first-mover does not always work out. There have been many, many cases of gadgets that have been ground-breaking, but have not been well-received by targeted end-users (what about the recent Google Glass fiasco?). You need to be careful while making mobile apps too. Do not try creating apps for something which no one has ventured in till date. Instead, analyze how the first-mover’s products are reviewed, and then, try to improve on them. You will get a reference point to start off too.
  6. If you exist, the world should know about you – Sadly, this is the issue that most new-fangled mobile app entrepreneurs gloss over (and consequently, their companies fail). Your technological and app development expertise might be of the highest order, but other people need to be made aware of that first. How do you do that? Simple enough…try to get into strategic partnerships with other tech firms (do not sell off your company though!), and target the World Wide Web to spread the word about your company (create a nicely optimized, informative website, have an active presence on popular social media channels, etc.). Request your initial customers/clients to give feedback about your services – which you will be able to show off on your website. Of all types of promotions, nothing has more long-run benefits than positive word-of-mouth publicity.
  7. Sketch out a detailed business model first – A client gets in touch with you, an iPhone/Android app is created and delivered, and you collect the app development fees. Straightforward, right? Unfortunately, helming an actual mobile app company is far from being this easy. You need to lay down, and follow, a detailed, properly deliberated upon, business model from the very outset. Divide your operations in separate stages – right from providing online free app quotes and deciding the advance payments (do not go beyond 30% of the overall charges), to creating and sharing wireframes/mockups, mobile app testing procedures, and the submission at stores. The more systematic you are, the brighter are the chances of your company’s success.
  8. Be a leader, not a boss – During an interview conducted just before the start of the Cricket World Cup 2015, Aussie Test captain Steven Smith said ‘managers are many, but leaders are few’. The same thing can be said about the owners of mobile app startups. Remember, your team of app developers and designers need you by their side, for guidance, direction and on-the-job training. Never be stand-offish, be easily approachable (of course, for project-related discussions), and offer incentives and perks to your best employees. Try being an inspirational leader who leads by example, and not a proverbial ‘Hari Sadu’!
  9. Never be afraid to experiment – Every mobile app developer wants to transform ideas into apps – and if they are any good, they will always try to think up new, innovative ideas. Now, not all such ideas would work (and that’s only natural) – so it makes sense to carry out small-scale experiments with the more ‘unique’ ideas (read: create prototypes), test them, gather feedback, and then decide whether it would be worth it to allot resources for developing that app. The alternative to this is, of course, going with run-of-the-mill app ideas – but that is a sureshot recipe for disaster for startups.
  10. Move with the times – The app development techniques and strategies (heck, even the apps themselves) should be in sync with the prevalent mobile technology at any time. For instance, after the release of WatchKit, every app company is chalking up plans to make apps for Apple Watch (generalizing a bit more, wearables are the new in-thing, and apps customized for them are likely to be in demand). At the time of iOS 8 and Android Lollipop and Swift programming language, if you stay stuck with elementary Java apps (we started with them, but that was 2006!) – why should any client avail your services?

For startups, money, time and resources (technical and manpower) are likely to be in limited supply. That, however, does not mean that you should be stingy about investing properly on your services. Half-baked, problematic apps (created as a result of your desperate attempts to cut costs) would invariably create a negative buzz about your company – and you will struggle to come out of that. Smart mobile app entrepreneurs always compare the investment figures with the lifetime return value for each project. If the situation so demands, you will have to spend – for making the future of your company secure.

 

Let’s round up this week’s ABT with wishing all the luck to budding mobile app developers and startup owners all over. Making your business work in this fiercely competitive domain is not the easiest challenge, but if you stick at it and are a smart decision-maker, you can definitely succeed.

 

AppBoard Tuesday will return next week, with yet another intriguing topic related to mobile applications. Till the next time, love thy apps!

 

Hussain Fakhruddin
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Hussain Fakhruddin

Hussain Fakhruddin is the founder/CEO of Teknowledge mobile apps company. He heads a large team of app developers, and has overseen the creation of nearly 600 applications. Apart from app development, his interests include reading, traveling and online blogging.
Hussain Fakhruddin
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