RMRB 1389 – Building an Application Business Making $272K per Year in the News & Education Niche

In this episode, Lauren talks to the seller of an application and subscription business created in December 2023 in the news & education and hobbies niches. Listen in to find out how the business makes an average of $272,586.00 per year in net profit, why the seller has decided to sell, the lessons learned from running the business, and much more.

Visit https://empireflippers.com/listing/97290 to learn more about this business.

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Transcript

Forget gurus. Forget anyone claiming to be an online business expert without going through the challenges of entrepreneurship themselves. The Real Money Real Business podcast is here to prove the best insights in online business come from your fellow online business builders. We dig into the stories of entrepreneurs selling their businesses on the Empire Flippers marketplace so that you can learn how they made their businesses profitable, how they overcame obstacles, and what lessons they learned in their online journeys. If you want to take your…

Hey everyone, welcome to another episode of the Real Money Real Business podcast. We record these interviews so that potential buyers can learn more about the business and the seller to help them make an informed buying decision.

If you would like to learn more about this business, including details like what type of business it is, how much revenue and profit it makes, and all of the assets included with the business, simply visit empireflippers.com/marketplace and search for this business’s listing number, which you can find in the video thumbnail and in the description. Or, if you’re watching this on YouTube, you can click the link in the description to go straight to the listing.

So, without further ado, let’s get into this interview.

First up, let’s learn a little bit about you. Can you tell us about your background in building and running online businesses?

I have a software engineering background and a computer science degree, but my journey with mobile apps started even before university, when I was fascinated by this new technology. Mobile apps hadn’t been around for that long back then, in 2016 or 2017. At one point, I tried to make some money out of the hobby, and it turned out quite well for me over the years.

I then learned what it takes to rank apps in the Google Play Store and the Apple App Store, and what it takes to grow an app beyond simple App Store optimization. So, it all became more and more professional. I published several apps over the years, and I started this app in particular towards the end of 2023. I have to say, it has been the most profitable niche I’ve been in so far. It has profited a lot from recent news coverage, but I won’t go too much into detail on that. I think it’ll be available to the buyer once the listing is unlocked.

Why are you selling the business now instead of keeping it and growing it further?

This summer, I started becoming a pilot, so I began with my PPL, my private pilot license. Now that I have that, I want to explore the aviation space a little bit more, so I signed up for an ATPL course, which is the license you do if you want to become an airline pilot. This will take a little more of my time than I anticipated.

I’ve been thinking of keeping the business for a while, but I think this would be an ideal point for me to make the switch completely to a new industry. I’ve been in the app space for almost a decade now, and I’d say I’ve grown a little tired of apps in general. This new career in the aviation space excites me much more than continuing to work on the same app for more years to come.

Can you describe the amount and the type of work that you do on this business to maintain it?

Personally, I haven’t invested as much time in the business as it deserves, I would say, to make it grow properly. Every month, I update the spreadsheets for accounting purposes and just check if revenue is still intact. Maybe once or twice per year, I check the Google Ads campaign to see if the ROI is still good.

Since there are settings in the campaigns themselves that limit the campaign’s profitability, there is not a lot of risk involved in the Google Ads campaign. For example, the campaigns would run at a defined ROAS, or return on ad spend, of, let’s say, 300%. So, it’s very unlikely they’ll go below that. If that happens, then the ad spend will just become less and less, eventually reaching zero.

Other than that, there have been a few updates over the years, but this was more because I wanted to push out more features. I would recommend publishing at least one update per month. This is a good ranking signal for the algorithms on Google Play and the Apple App Store. Other than that, there’s really not much work required to maintain such an app.

If you were to keep this business, what are some of the ways you would try to grow it?

If I had the time to continue this business, I would likely try to explore the web app presence further. A couple of months back, I added multiple features to the web app part of the software. So far, only the mobile apps have been generating profit, but the need is definitely there for desktop users as well. With that web app in place, people can now discover our software through Google searches. There’s been some traffic, but there’s definitely much more potential if someone with the right skill set has a look at it and tries to grow it.

Other than that, I would say exploring new markets when it comes to Google Ads could be interesting, or maybe even trying out other ad platforms like Meta Ads or video ads. I haven’t tried those.

Right. And what would you say are the biggest risks with this business that buyers should be aware of?

The main risk I can think of is updates to the ranking algorithms of the Google Play Store and Apple App Store that could affect new subscribers coming to the app. The good part is that there is already a large base of current subscribers, and our current rankings in the Google Play Store and the Apple App Store have been consistent for almost three years. It’s definitely a risk, but I wouldn’t say it’s a huge risk compared to other online businesses.

How much support are you willing to offer the buyer who acquires this business?

I’m quite flexible when it comes to the support I’m willing to offer buyers after an acquisition, especially in the first few months. I’m willing to work as a developer on the project. I can develop new features and work on existing ones, all on an hourly basis, and help with the transitioning phase to a potential long-term solution.

Are you open to negotiating something like an earnout agreement?

Yes, I’d be willing to accept an earnout payment structure if the terms are right, of course, and reflect the business potential.

Okay. Final question. If you had to put yourself in the shoes of a buyer, why is your business worth buying?

I think the best argument for acquiring this business is the steady growth of the subscriber base. Ever since this business started, the number of subscribers has just been growing, and we can see that each year’s profit has been higher than the one before. It’s also quite above average when we look at the yearly renewal rate. It’s over 40%, which is a very good benchmark for mobile apps.

All right, everyone. Thanks for listening. To learn more and see if this business is still for sale, head over to empireflippers.com/marketplace and search for this business’s listing number, which you can find in the video thumbnail and description. Or, if you’re watching this on YouTube, click the link in the description to go straight to the listing. Once you’ve unlocked this listing, you’ll find everything you need to know about this business.

Thanks for joining us. See you next time.