Let's talk about how and where you can sell your app, if you don't want to, or you are not able to continue working on it.
Mobile apps, just like any other business, can be bought or sold. But why the developers want to sell an app? Well, the reasons could be different. Some developers have troubles with their app marketing, others just want to get started with something new.
Where to sell? The first option is self-serve marketplaces, where every developer can submit an app. Also, you can try to sell an app to companies that specialize in buying specific kinds of apps, as games, utilities, etc.,
In addition, Apple recently allowed app transfers for developers that participate in the Small Business Program.
Apps with in-app subscriptions and/or ad monetization are easier to sell than paid apps. These apps are mostly from Utilities and Entertainment categories: wallpapers, widgets, customizers, cleaners, VPNs and so on. Complex apps, like video editors, are sold much less frequently.
Marketing is the toughest part in the app business, especially in the SKAdNetwork era.
The decision to sell an app is not that easy. Sometimes you may think that you will start earning very soon with this super cool feature or that super addictive creative. But weeks go by, and growth is not showing up on the horizon. You start a new campaign, it even may show great ROI, but a few days later it goes down.
Familiar situation? What are the options?
Well, this is not the only case when you should sell your app. Sometimes a great time is when your app shows great revenue and is on the peak of its profit. In this case, you may have a great deal, because it's unclear how long this success will last.
Evaluating an app is always an estimate. It depends on some factors: revenue for the last few months, churn, retention and app age. The formula is roughly the following:
Sell Price = Average monthly net profit X multiplicator
The multiplicator is typically between 12 and 36. Let's say, your app for the last 6 months earned about $3,000 per month. And your app is 1 year old. Then you can count on a $36,000 deal.
As mentioned before, if subscriber retention is good and churn is low, then you may sell at a higher price.
In Apphud you can view cohort analysis for subscriptions with necessary filters as well as subscription churn chart.
Subscriptions Churn chart can show you how fast your subscribers cancel their subscriptions within a selected time interval (day, week or month).
In case you sell an iOS app, there are some app transfer criteria. In particular:
If you were using Sign In with Apple, consider updating your app and removing it. Or you can negotiate with the buyer and sell him the whole developer account.
If all check marks are green in your app's transfer page in App Store Connect, then you are OK with the transfer.
What else should you consider before a sign-off? Clean your code, remove personal or other compromising data, etc.
If you are selling an Android app, there are no specific limitations on the app transfer. Last but not least, if the app has a 15% service fee tier, the app's earnings for this year will be also transferred for reduced fee calculation.
The most popular self-service marketplace – Flippa. It's the largest marketplace, with more than $400M in sales. However, Flippa takes a huge 10% fee for their services, which is not the only fee being added. Escrow, which Flippa works with, takes an additional small disbursement fee, about $20.
There are a few more marketplaces worth mentioning:
In addition to self-serve platforms, there are also companies that buy out apps:
We had a chance to talk with Alon Waller, CEO of BlueThrone. Here is an excerpt from our interview with him.
Hello, Ren! Nice to meet you. Well, long story short. Most developers are not good at marketing, or at doing the boring, consistent stuff that makes a extraordinary app grow beyond it’s initial hockey-stick stage. Developers love to develope. To create. To go from o to 1, not from 1 to 100. We are a team of professional marketers and growth experts that buy extraordinary apps, push them beyond the glass ceiling and earn from them. Our passion is the 1 to 100. We have been doing this for 5 years already, and helped more than 100 developers to score an exit on their assets.
It depends on the revenue, complexity and niche. I would say 70%+ of the apps we buy are extraordinary utility apps, and the rest are simple games and entertainment apps.
We all know the critical metrics for an app. Downloads, conversion, retention, churn, rankings and more. We look for apps which are extraordinary on 1-2 of these metrics. That’s how we know there’s something special in the app that the market love, and from there- we can push the app into new heights.
After the developer prepares and sends us all necessary screenshots and other info, it takes a few days to assess the app and determine if the app has further growth potential. If the decision is positive, it takes an additional 1-2 weeks to finalize the deal. However, it may take additional time in case of transferring backend code with deploying to a new hosting, etc.
We have professional backend developers, who will help to transfer backend code, deploy to a new infrastructure and deal with ever challenges arise in the process.
It’s monthly revenue, of course, and MAU. I would better share with you a link: https://freeappvaluation.bluethrone.io/
This is our free app valuation tool, very easy to use.
Yeah, I’ve heard about Apphud and used it, for sure. We bought many apps with Apphud SDK integrated! Charts with advanced filters as well as convenient dashboard – that’s what I love most about you guys.
Thank you too, Ren.
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