an introduction to mobile app development and investing

MOBILE APPS

Charlie Morris, iOS developer

An introduction to development and investment options

HELLO!

‣ iOS developer at Mind Fund Studio

‣Previously worked in Venture Capital at AAIC Ventures

‣Originally a suit wearing management consultant in London (for 5 years)

CHARLIE MORRIS

AGENDA

‣Brief overview of the mobile app market

‣Understanding your app development options

‣ Investment tactics: How to get started with app valuation and investing in mobile apps in Hong Kong

THE MOBILE APP MARKET

MOBILE APP DEVELOPMENT AND INVESTMENT

...IS MASSIVE AND

GROWING

MOBILE APP MARKET


Source: Statista 2015

SMARTPHONE SALES ARE ASTRONOMIC


ANDROID DOMINATES DEVICES



MORE ANDROID APPS ARE DOWNLOADED THAN IOS


Source: AppAnnie Note Over 100bn cumulative iOS downloads


BUT IN TERMS OF REVENUE...

Source: AppAnnie

‣Paid app

‣ In app purchases (often associated with "Freemium")

‣Subscription model

‣Advertising - Direct advertising (banner / full page) - Indirect (sponsored content)

4 MONETIZATION METHODS


ONLY 9% OF IOSDOWNLOADS ARE PAID...



...TOTALING

$34,990,000,000



IN APP PURCHASES ARE KEY


Source: AppTopia Note: More case studies at http://www.bluecloudsolutions.com/blog/13-top-grossing-apps-revenue/#

http://www.bluecloudsolutions.com/blog/13-top-grossing-apps-revenue/#

Games is the largest genre on the Apple app store



IT IS A HUGELY COMPETITIVE MARKET


Source: LukeW Ideation and Design

DEVELOPMENT OPTIONS


1. What platform should you develop for?

2. How should you develop for your chosen platform(s)?

3. Should you build it yourself or get help?

3 KEY DEVELOPMENT QUESTIONS



1. WHAT PLATFORM?

‣ iOS ‣Android ‣Windows ‣Blackberry ‣FireFox OS ‣Sailfish ‣Tizen ‣Ubuntu ‣Others...


APP PLATFORMS


‣Smartphone ‣Operating system ‣Marketplace (App Store, Google Play, etc) ‣Payment infrastructure ‣Additional Services (iCloud, Game Center, etc) ‣Marketing tools ‣Developer tools ‣ Integration with other devices (IOT, wearables, iBeacon, etc)

ECOSYSTEM CONSIDERATIONS

‣C level executives are more likely to own an iPhone

‣Finland has a higher propensity of Windows Mobile

‣Africa and Latin America have a deeper penetration of Blackberry

MARKET CONSIDERATIONS

What does your target market look like?


WHAT ABOUT HONG KONG?


‣Mobile: 24% - iOS 74% - Android 2% - Other

‣Tablet: 82% - iOS 17% - Android 1% - Other

Source: ComScore

2. HOW TO DEVELOP?


APP TERMINOLOGY


WEB APP NATIVE APP HYBRID APP

‣Mobile-optimized webpages that look like an app

‣Accessed through the phone browser

‣Not on any app store

Built in native code for a specific operating system

Downloaded from an app store

Can use all device features

‣Built in web languages for use on multiple operating systems

‣Downloaded from app stores

‣Can use all device features (kind of)

WEB APPS


‣Refers to websites that behave like applications

‣Advantages: - No need to install app - Easy to share and organically spread - Instantly updated on the server-side

‣Disadvantages - Not on the app store... is it even a "real" app? - Device capabilities - push notifications, GPS, camera, etc - are unavailable

Note: iOS 1 had no app store; this is all we could do then!


NATIVE APPS‣Apps built using the toolset that Apple or Google

provide

‣Advantages - Able to use all of the device’s capabilities - High performance

‣Disadvantages - Need to start all over to build app on the other platform

‣ IDE (integrated development environment): Xcode

‣Languages: Objective C / Swift

‣Testing: Simulator / device, Testflight

HOW DO YOU BUILD IOS NATIVE APPS?


DEMO

HOW DO YOU BUILD ANDROID NATIVE APPS?


‣ IDE: Android Studio

‣Languages: Java

‣Testing: Simulator / device

‣Camera ‣GPS ‣Accelerometer ‣Microphone / Speaker ‣Local storage ‣Vendor APIs ‣Touch Gestures


TECHNICAL BENEFITS OF NATIVE


BIG PROBLEM WITH NATIVE...

TWO CODE BASES


HYBRID DEVELOPMENT

‣Hybrid development combines the best (or worst) of both the native and HTML5 worlds

‣ It is a web app, primarily built using HTML5 and JavaScript, that is then wrapped inside a thin native container that provides access to native platform features

‣PhoneGap is the original and popular container for creating hybrid mobile apps

WHAT IS HYBRID DEVELOPMENT?


HOW DO YOU BUILD HYBRID APPS?‣ IDE: Text editor of choice / terminal

‣Languages: Javascript

‣Testing: Chrome / device (depending on framework)


DEMO

‣The beautiful, open source front-end SDK for developing hybrid apps

‣Creator makes it easy to rapidly build Ionic mobile apps, with a drag-and-drop interface and real code exporting

‣Can be tested on the Ionic app in iOS and Android

IONIC - CURRENT BOSS OF HYBRID


‣Any sort of online component requires a backend service (API)

‣This backend could be custom built: Node.js, Ruby on Rails, PHP, Python, ASP.NET

‣Or you might be able to use a Backend as a Service provider: Parse, Firebase

‣Or perhaps all you need is integration with an existing service provider: Facebook, Twitter, Dropbox


BRIEF WORD ABOUT THE BACKEND

http://ASP.NET


3. BUILD YOURSELF OR GET HELP?

WIREFRAMING FIDELITYLOW MEDIUM HIGH

www.balsamiq.com www.sketchapp.comPen and paper


http://www.balsamiq.com

http://www.sketchapp.com

‣Shoutem ‣Mobile Roadie ‣Mag+ ‣Adobe DPS ‣Como ‣GoodBarber ‣AppPresser ‣AppYourself

AN INCREASING NUMBER OF WYSIWYG PLATFORMS


‣AppMachine ‣Mobincube ‣BIZNESSAPPS ‣MobAppCreator ‣AppMakr ‣Apps-Builder ‣AppyPie ‣ IBuildApp

‣BuildFire ‣Appery.io ‣Gamesalad ‣MobiCart ‣ app.cat ‣AppNotch ‣EachScape ‣Zoho Creator

‣Online courses: - Codecademy - Treehouse - CodeSchool - BitFountain - Ray Wenderlich (iOS)

‣Real life classes: - General Assembly (*wink*):

DIVING INTO PROGRAMMING


‣Agencies in HK: - Mind Fund Studio (*wink*) - Altitude Labs - 42 Labs

‣Freelancers: - Locally (check out co-working spaces) - Globally (Crew, Upwork, Freelancer, etc)

BUYING DEVELOPMENT SKILL


Reliable

Expensive

Unreliable

Cheap

INVESTMENT TACTICS


WHAT TO LOOK FOR?


‣ If pure software: - Exert extreme caution - easy to replicate - Look for technical sophistication and prowess - Look for exceptional marketing skills

‣Hardware meets software is a local strength - Insight robotics, DJI, Snaptee

‣Hardware meets software meets logistics meets crack marketing... the dream

‣Co-working spaces: Blueprint, Cocoon, Garage Society, Paperclip, GoodLab, Cyberport, Metta, etc

‣Universities: HKUST, HKU, etc

‣Crowdfunding websites: Investible.vc, EastFounder, etc

‣Accelerator programs: Nest, DBS, Cyberport, Blueprint, etc

‣Events: Rise, FinTechHK, Startup Weekend, Hackathons, etc

WHERE TO LOOK?


‣Technical audit: - How can you gauge degree of sophistication? - Who can you trust to evaluate the technology?

‣Developer commitment: - High demand for developers and low supply - Very fluid industry

CHALLENGES


‣Analysis of revenue traction over time and overall profitability of the business model:

- User growth is hugely speculative - App usage is similarly speculative

‣Tangible assets?

‣Previous rounds?

VALUATION


‣Tranches investment offer; offering a tiered incremental investment stream based on the owner executing to milestones correctly

‣Backing experienced (ideally successful) founders

‣Obtaining character references

DE-RISKING


THE MALE OR FEMALE APPROACH?


INVEST AND PRAY


Q&A


E: [email protected]: @CHTMORRISW: CHTMORRIS.COM

THANK YOU!

CHARLIE MORRIS

an introduction to mobile app development and investing

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