Appster Aims to Cut Mobile App Startup Starting Costs By Half
Image above – Startup daily
Appster, an Australian based mobile app service company has established its presence in the world’s most competitive market, Silicon Valley. Founded by early twenty’s wunderkind duo Josiah Humphrey and Mark McDonald, Appster is bringing it’s technical co-founder service model to impact the speed and cost to market for non-technical founders.
To put a stamp on its arrival, Appster has recruited a heavyweight Chief of Marketing in Mike Wehrs, a former Microsoft MSFT -0.12% Executive and Chief Executive Officer of the Mobile Marketing Association. Wehrs’ strategic relationships is set to accelerate Appster’s brand awareness amongst the who’s who of Silicon Valley.
For a tech start-up in the Bay Area, Appster estimates it can cost upwards of $1 Million in money and equity to hire a tech team. “We want to do everything we can to reduce that amount to half or more,” said Humphrey. For businesses looking to launch a mobile product or a company looking to outsource, the cost savings is a compelling proposition.
Beyond just making mobile apps, Appster is passionate about lifting stellar ideas off the ground. To reflect this, Appster starts by consulting with entrepreneurs to refine their idea to create a minimum viable product and test for product-market fit. Following that, while still in beta, Appster Growth Labs is geared towards ramping up user acquisition.
Despite being only six months into setting up a San Francisco office, the company is already profitable in the U.S. The team is only one salesperson but soon expanding to three, with a mix of product managers and facilitators.
According to Humphrey, there is huge demand for Appster, “We had to turn off adverting in December because we were overwhelmed with demand.” For startups competing for programmers, Appster’s advantage is its ability to ramp up an experienced team overnight, for a good price without giving away any equity. Appster is beginning to make in-roads with venture capitalists to serve well-funded start-ups that need to move fast.
By many measures, Appster is already successful in Australia. After only three years, it has clocked AU$10 Million in annual revenue. By 2018, Appster aims to hit AU$100 Million in annual revenue and have 1,000 employees called ‘Appsterfarians’. Humphrey said he would be disappointed if they didn’t exceed that.
But by moving to Silicon Valley, Appster is looking to compete in the big leagues where people just as young and ambitious are plenty. Entrepreneurs are more sophisticated and the projects more diverse and challenging. In the U.S., there tends to be more medical and hardware integrated projects spinning up.
One example of an early U.S. project is for an app called ResQMedical. It’s a system that tracks staff in hospitals to keep a log of their hours spent in the hospital it also provides them with a communication system that is HIPAA compliant.
Appster has been growing quickly. In the last quarter of 2014, Appster hired fifty staff, an increase of 40% across Melbourne, India and the U.S., to take the total headcount to 150. To support its rapid growth, it launched Appster University, a program to take the best programming graduates in India. The grads, called ‘Fresher’s’ are paired with Senior Developers and assigned to tribes to work on real Appster projects. At the conclusion of the program, a selection of ‘Fresher’s’ will be offered a full time position with Appster.
Although Appster has never taken outside funding, it is not ruling out the option of raising capital this year to fuel expansion. With solid traction and zero debt, Appster is in a strong position to take investor money without diluting a lot of equity.
“It’s been a blessing in disguise that we weren’t so aggressive to raise funding in the early days, but instead focus on execution humming so we could remain profitable every single month. We’re always focused on the bottom line rather than worry about if we’re going to spend money on some cool startup perks for new employees,” said Humphrey.