Prepare to Join the App Millionaires Club | Martin Macmillan
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Delivered at Casual Connect Asia 2016 Popular reports suggest you need a high app store chart position to guarantee your game gets the visibility it needs to succeed. However, Pollen VC's research has found that outside the Top 25 app store rankings, an increasing number of games are generating more than a million dollars in revenue a year. Martin Macmillan will discuss how they do it and how you should prepare for launch to ensure that your game is a success.
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Prepare to Join the App Millionaires Club | Martin Macmillan
- 1. PREPARE TO JOIN THE APP MILLIONAIRES CLUB CASUAL CONNECT SINGAPORE 2016 MARTIN MACMILLAN, CEO
- 2. Prepare to Join the App Millionaires Club 2 WHO ARE WE? Pollen VC is a FinTech company which is disrupting payments in the app economy with a new data driven lending model We offer app and game developers access to an ecosystem of services which enable them to accelerate growth We offer a new type of flexible and non-dilutive financing for developers Offices in London, SF, Amsterdam and Helsinki
- 3. 3 WHAT DO WE DO? Early access to funds Funding marketing spend Unbiased Guidance - Pollen360 We give app developers early access to revenues they’ve earned from the app stores, so they can rapidly reinvest in the resources they need to grow their business faster Prepare to Join the App Millionaires Club
- 4. 4 THE OPPORTUNITY: PLATFORMS ONLY PAY OUT REVENUE UP TO 60+ DAYS AFTER YOU’VE EARNED IT. LAUNCH You’re earning money from day 1 This is your money trapped in the payment system Platforms release your cash… Prepare to Join the App Millionaires Club
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- 10. 10 Everyone knows the stories about a few apps that go viral with no promotion. For the 99.9% of all other apps launched, it’s necessary to spend to acquire users. THE REALITY IS THAT YOU NEED TO SUPPORT YOUR APP WITH PAID UA Prepare to Join the App Millionaires Club
- 11. 11 THE USER ACQUISITION CONUNDRUM $2$1 Prepare to Join the App Millionaires Club
- 12. 12 THE USER ACQUISITION CONUNDRUM 50c$1 Prepare to Join the App Millionaires Club
- 13. 13 THE USER ACQUISITION CONUNDRUM Unless you have worked out an ROI positive way to spend money on paid UA, no amount of VC or external investment will get you the result you need. FACT Prepare to Join the App Millionaires Club
- 14. Prepare to Join the App Millionaires Club 14 LAUNCH SCALE OPTIMISE MAJOR CASH FLOW EVENTS
- 15. Prepare to Join the App Millionaires Club 15 THE IMPACT OF CASH ON UA • $1.50 LTV [365 day max] • $1.00 CPI • 5,000 Installs/Day Assumptions:
- 16. Prepare to Join the App Millionaires Club 16 LTV PROFILE $0.00 $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.60 1 11 21 31 41 51 61 71 81 91 101 111 121 131 141 151 161 171 181 191 201 211 221 231 241 251 261 271 281 291 301 311 321 331 341 351 361 Days from Launch Example LTV Curve
- 17. Prepare to Join the App Millionaires Club 17 PLATFORM REVENUE PAYMENTS Payments $0 $40,000 $80,000 $120,000 $160,000 $200,000 Week After Launch 0 4 8 12 16 20 24 28 32 36 40 44 48 52
- 18. Prepare to Join the App Millionaires Club 18 NET CASH POSITION NetCashPosition -$400,000 -$320,000 -$240,000 -$160,000 -$80,000 $0 $80,000 $160,000 Weeks After Launch 0 4 8 12 16 20 24 28 32 36 40 44 48 52 Net Cash Position first becomes Positive First App Store payment hits bank account Spending $5,000/ day on ads
- 19. Prepare to Join the App Millionaires Club 19 USING UNPAID REVENUE NetCashPosition -$400,000 -$320,000 -$240,000 -$160,000 -$80,000 $0 $80,000 $160,000 $240,000 $320,000 $400,000 Weeks After Launch 0 4 8 12 16 20 24 28 32 36 40 44 48 52 Net Position Net Position w Revenue Recycling Recycling revenue allows you to stay cash flow positive with a fraction of the starting budget. Or leverage up and do much more UA with the same budget.
- 20. Prepare to Join the App Millionaires Club 20 HOW TO FINANCE GROWTH VENTURE FUNDING Product Team Acquisitions DEBT FUNDING Marketing/Paid User Acquisition Financing projected cash flow
- 21. 21 HOW DO DEVELOPERS BENEFIT? Do more with your money at an earlier stage Keep control of your business Remove ad network credit hassles Unbiased training to maximise your return on UA Prepare to Join the App Millionaires Club
- 22. CASE STUDY: PIXONIC Top 100 Grossing Game on iOS Founder: Philipp Gladkov Offices: Berlin, Moscow Company Size: 55 Backed By: Kite Ventures, TA Associates Known For: Walking War Robots (iOS + Android) Prepare to Join the App Millionaires Club
- 23. Prepare to Join the App Millionaires Club 23 “Working with Pollen made it possible to increase the revenue of our game Walking War Robots sixfold and to double the size of our team. I think that Pollen offers a great opportunity to game studios that require a boost in development.” - Philipp Gladkov, CEO, Pixonic Launch Budget: $100,000 Reinvestment Rate: 40-85% weekly REINVESTING REVENUE IN GROWTH • Reinvested revenue 30-67 days earlier • With an identical cash position, with Pollen Walking War Robots Revenue to 3x more over 10 months $0 $8,000 $16,000 $24,000 $32,000 $40,000 1 2 3 4 5 6 7 8 9 10 With Pollen Without Pollen *indexed figures
- 24. Prepare to Join the App Millionaires Club 2424 Reinvest directly into advertising Acquire more users faster Draw down earnings on a daily basis A NEW WAY…