How to Build an App Empire: Can You Create The Next Instagram?


Chad Mureta runs his seven-figure app business from his iPhone. (Photo: Jorge Quinteros).

I first met Chad Mureta in Napa Valley in 2011.

Two years prior, he had been in a horrible car accident. He’d lost control of his truck in at attempt to avoid a deer, hit a median, and flipped four times, nearly destroying his dominant arm in the wreckage.

While in the hospital for a lengthy recovery, a friend gave him an article about the app market. Shortly thereafter, Chad began designing and developing apps. His results?

“In just over two years, I’ve created and sold three app companies that have generated millions in revenue. Two months after launching my first company, one of my apps averaged $30,000 a month in profit. In December of 2010, the company’s monthly income had reached $120,000. In all, I’ve developed more than 40 apps and have had more than 35 million app downloads across the globe. Over 90 percent of my apps were successful and made money.”

After finishing rehab, Chad was able to leave his real estate company, where he’d been working 70 hours a week, to run his app business from his iPhone… in less than 5 hours per week.

“Apps” are the new, new thing, thanks to major successes like Draw Something (bought by Zynga for $210 million) and Instagram (bought by Facebook for $1 billion), among others. But for all the hype and promise, few people actually know how to create something that gets traction.

In this post, Chad will discuss his step-by-step formula for rapid app development and sales optimization. It covers real-world case studies and the details you usually don’t see: early prototype sketches, screenshots, how to code if you don’t know how to code, and much more.

Last but not least, don’t miss the competition at the end. If you’ve ever thought “I should make an app that…,” this one is for you…

Enter Chad Mureta

When you are on your deathbed, will you be able to say you lived a fulfilled life?

I nearly couldn’t.

I started my app business from a hospital bed, wondering if I even wanted to live. I had barely survived a terrible car accident that shattered my left arm. I had gone through two groundbreaking operations, and spent 18 months in painful rehabilitation.

With limited insurance, I had racked up $100,000 in medical bills. Even though I survived, I had no clue how to get out of the deep hole I felt trapped in. I was moved to a physical rehabilitation center and worked on reconstructing my body, my mind, and ultimately my life. While I was there, I read two books that made a huge impact: Unlimited Power strengthened my thought processes, and The 4-Hour Workweek inspired me to pursue lifestyle freedom.

During that time, a good friend gave me an article about “appreneurs” and told me I should consider getting into the business. I learned that most appreneurs were one- or two-person teams with low costs, and the successful ones were bringing in millions in profits. Still in my hospital bed, in a state of semi-coherence from the pain medication, I began drawing up ideas for apps.

Three weeks after my final surgery, desperate, broke, and grasping at straws, I borrowed $1,800 from my stepdad and jumped into the app business. Fortunately, taking that leap was the best decision I’ve ever made…

These days, my life is about doing what I love while earning easy income. I run my business from my iPhone, working in a virtual world while earning real dollars. I am part of a growing community of “appreneurs,” entrepreneurs who make money from applications that are used on iPhones, iPads, iPods, Droids, and Blackberries. As of this writing, the world’s youngest appreneur is nine years old, and the oldest is 80!

Appreneurs earn money while creating lifestyles of great freedom. Two of my appreneur friends spend several months of the year doing nonprofit work in Vietnam, while their businesses are generating seven-figure incomes. Another is taking his kids to see the Seven Wonders of the World, creating priceless memories with his family. Still another friend goes backpacking throughout Europe with his wife for most of the year. As for me, I’ve hiked in the Australian Outback, trekked with Aborigines across the desert, climbed in the Rocky Mountains, got certified in solo skydiving, heli-skied in Canada, walked on fire, and most important of all, learned not to take life so seriously.

No matter what your dream lifestyle is, you can have it as an appreneur.

The Opportunity for Appreneurs

There are currently more than 4.6 billion cell phones being used worldwide, enough for two-thirds of the people on Earth. The app market is literally the fastest growing industry in history, with no signs of slowing down. Now is the perfect time to jump into the mobile game.

What happened during the early days of the Internet, with the creation of websites like Google and eBay, is exactly what’s happening today with apps and mobile technology. The only difference is that we have experienced the rise of the Internet and are conditioned to react more quickly to the app revolution. This means that the app world is running light years ahead of the Internet, when it was at the same development stage. Developing apps is your chance to jump ahead of the masses and not be left behind, saying years from now, “I wish I had…”

Common Objections

“I’m not a tech person. I have no experience in this market.”
I was in the same spot, and I still don’t know how to write code. But I found successful people to learn from, emulated their models, and hired programmers and designers who could execute my ideas. If you can draw your idea on a piece of paper, you can successfully build an app.

“The app market has too much competition. I don’t stand a chance.”
This industry is just getting started– it’s less than four years old! What makes the app business unique is that the big players are on the same playing field as everyone else. They have the same questions and challenges as you and I will have.

“I don’t have the money.”
You don’t need a lot of money to start. It costs anywhere from $500 to $5,000 to develop simple apps. As soon as you launch your app (depending on your sales), you could see money hit your bank account within two months.

“It’s difficult… I don’t understand it… I’m not smart enough.”
Just like everything you’ve learned in life, you have to start somewhere. Fortunately, running an app business is far easier than almost every other type of business. Apple and Google handle all of the distribution, so you can spend your time creating apps and marketing them. And you don’t have to come up with new, innovative ideas. If you can improve on existing app ideas, you can make money.

Many people are joining the app gold rush with a get-rich-quick mentality and unrealistic expectations. Maintaining an optimistic perspective is important, but so is understanding that you will have to put in work. My goal in this post is to help you think like a business owner, and show you the map I’ve used to find “the gold.” This is not a one-time app lottery, and you can’t treat it as such. If you think of this endeavor as a long-term business, it will grow and become a sustainable source of income.

Still interested? Then let’s get started!

Step 1: Get a Feel for the Market

As with any business, your success will be directly related to your understanding of the marketplace. The App Store is the marketplace of the app business, so in order to understand the market, we have to study the App Store. This seems rather obvious, but you wouldn’t believe how many developers I meet that don’t understand this concept. They don’t watch the market, follow the most successful apps, or try to figure out why those apps are successful.

In order to become a great app supplier, you must first become an app addict. That means spending at least 2-4 weeks researching the market while downloading and playing with tons of apps (give yourself an app budget of $100 to start). This training period is an investment in your expertise, which will become the lifeblood of your success. The more hours you rack up playing around and studying successful apps, the better you’ll be able to understand their common traits and what users desire.

So, how do you keep pace with the market? The best way is to study Apple’s cheat sheet constantly. The App Store displays the top paid, top free, and top-grossing apps (the apps that make the most money, including free apps), almost in real-time. Apple provides the same lists in the individual app categories.

These charts are golden because they tell us volumes about the market. The best part is this information is freely accessible to anyone, at any moment (unlike the market info for basically every other industry).

Review these charts frequently, and keep a notebook of potential trends you spot. Doing this repeatedly will educate you on successful app design, marketing, and various pricing models. The research you’re doing is simple, costs nothing, and it’s actually fun!

Here are some questions to ask while you’re researching successful apps in the market:

  1. Why is this app successful?
  2. What is its rank and has it been consistent?
  3. Why do people want this app? (Look at the reviews.)
  4. Has this app made the customer a raving fan?
  5. Does this app provoke an impulse buy?
  6. Does this app meet any of my needs?
  7. Did I become a raving fan after trying it?
  8. Will the customer use it again?
  9. How are they marketing to their customers? (Check out the screen shots, icon design, and descriptions.)
  10. What is the competitive advantage of this app?
  11. What does this app cost? Are there in-app purchases? Advertisements?

Most developers will build an app and expect tons of people to find and download it right away. That rarely happens. You have to figure out what people are interested in and the kinds of apps they’re downloading first, then you build your app based on that insight.

Once you’ve put in the necessary 2-4 weeks of research and feel you have a decent grasp on the market, it will be time to look back on the trends you discovered and explore some ideas for potential apps you can develop.

Step 2: Align Your Ideas with Successful Apps

How do you know if the market wants your app? Again, you’ll need to look at the Top Apps chart. Are apps like the one you want to create listed there? If yes, you’ve got a potential winner. If not, keep looking. It’s that simple.

Don’t hate; Emulate! When you follow in the footsteps of successful apps, you will have a better chance of succeeding because these apps have proven demand and an existing user base. This takes the guesswork out of creating great app ideas.

I can’t stress the importance of emulating existing apps enough. It’s easy for people to fall in love with their own idea, even if the market doesn’t show an appetite for it. But this is one of the costliest errors you can make.

Unfortunately, developers make this mistake all the time. They focus on generating original ideas and spend a lot of time and effort creating those apps. When it doesn’t work out, they go to the next untested idea, instead of learning from the market. Often times, they repeat this cycle until they run out of money and dismiss the app game. This doesn’t have to be your experience.

A personal example of how to successfully emulate competitors is my Emoji app. First, I took a close look at what the market offered and downloaded all the major emoticon apps. I liked what I saw, but noticed that there was a lack of variety and limited functionality.

Screenshots from a competing Emoji app. The app (left) is opened once to provide the user with instructions on how to enable the Emoji keyboard (right).

I wondered how I could improve upon these existing apps, given that the Emoji keyboard had a limited number of emoticons that couldn’t be increased. I was also curious how profitable these apps could be if they were only being used once.

I kept brainstorming until it hit me. I couldn’t add more emoticons to the Emoji keyboard, but I could include unlimited emoticons within my app that people could send as images via text message or email.

I created an app that not only enabled the Emoji keyboard, but also contained an additional 450 emoticons within the app itself, which could be shared via SMS, e-mail, Facebook, and so on. The app was used constantly since users had to return to the app to send an emoticon.

Screenshots of my Emoji app.

The Emoji app was developed in two weeks. It followed the freemium model, meaning free with an in-app purchase option. The app hit the number one spot in the App Store’s productivity category and the number 12 spot in the top free overall category within six days, raking in nearly $500 per day. Bingo.

Whenever you decide to look into emulating an app, ask yourself these six questions:

  1. Why are people purchasing this?
  2. Can I do something to emulate this idea and take it to another level?
  3. What other ideas would this app’s demographic like?
  4. How many other similar apps are in the market? (Visit to find out.)
  5. How successful and consistent have they been?
  6. How does their marketing and pricing model work?

Step 3: Design Your App’s Experience

You’ve studied the market, you see an opportunity, and you have an idea that could be profitable. Great! Now it’s time to turn those thoughts into something tangible.

To convey your idea properly, you can simply draw it on a piece of paper. Maybe it will look like a 3-year old’s artwork, but it will still convey what you’re trying to do. Some people like putting this together in digital form, using Photoshop or Draft. Whatever you’re most comfortable with, and whatever will give the programmers the details they need, is the way to go.

For your viewing pleasure, here are the rudimentary drawings (a.k.a. wireframes) for my first app, Finger Print Security Pro. As you can see, it doesn’t have to be pretty!

And here’s how the app’s final design turned out:

To make the design process easier, I look at certain apps in the App Store and reference them to show my programmers what I’m looking for. For example, I’ll say, “Download the XYZ app. I want the ABC functionality to work like theirs. Take a look at the screenshots from this other app, and change this.” I take certain components of apps that I’d like to emulate, and give them to the programmer so that we are as clear as possible.

Highlight menu vs. Facebook menu
Notice any similarities? Highlight’s menu (left) emulated the style of Facebook’s menu (right).

The clearer you are, the fewer misunderstandings and problems you will have once it’s time to hand off your drawings to a programmer. The idea is to convey what the app will look like, where everything will be placed, and what happens if certain buttons are selected. This helps the programmer know what you want and will be a useful blueprint when designing your app. Do not be vague or ambiguous. You should know what every part of your app will do. If you don’t, you need to develop your idea more thoroughly.

You have to consider your design to be final before you can begin the coding phase. Inevitably, you will have ideas for additional features once you start testing the initial versions of your app. But if you decide to make major changes after a substantial amount of work has been done, it can frustrate your programmer. It’s like telling the builder who just installed your fireplace that you want it on the other side of the living room. The news will not go over well. Most people don’t realize this is what they are demanding of their programmer when they ask for big changes. That’s why it’s important for you to take your time and carefully plan every aspect of the app before you submit it for coding.

Step 4: Register as a Developer

You now have your idea drawn out. Before you go any further, you need to sign up as a developer with the platform for which you’re looking to create apps.

Don’t be intimidated by the word “developer.” It doesn’t mean you have to be the programmer. It’s simply the name used for somebody who publishes apps. All you have to do is set up a “developer account” so you can offer your apps for sale in one of the app stores.

Here are the links for each platform and a brief overview of their requirements.

Apple iOS *— Registration requirements include a fee of $99 per year and accepting the terms of service.

Android— Registration requirements include a fee of $25 per year and accepting the terms of service.

BlackBerry— Registration requirements include a $200 fee for every 10 apps you publish. You must have a BlackBerry World App Vendor Agreement in place with RIM (the creator of BlackBerry) to distribute apps.

* For your first app, I strongly suggest developing for Apple iOS, rather than Android or Blackberry. Simply put, Apple users are much more likely to spend money on apps. You will increase your odds of making a profit simply by developing for the iOS platform.

Also, don’t forget to go over the App Store review guidelines. Apple enforces these rules during the review process, and if you don’t follow them, your app will be rejected. For instance, you might remember seeing a plethora of fart or flashlight apps on the App Store awhile back. As a result, Apple has decided to no longer accept those types of apps. Knowing these rules can save you a lot of time and effort. If you see any of your ideas conflicting with the guidelines, reject them and move on to the next one.

Step 5: Find Prospective Programmers

Coding your own app, especially if you’re teaching yourself at the same time, will take too long. The likelihood of you getting stuck and giving up is very high. It will also be unsustainable over the long run when you want to create several apps at the same time and consistently update your existing apps. After all, the goal is to get your time back and escape the long hours of the rat race. Therefore, programmers will be the foundation of your business. They will allow you to create apps quickly and scale your efforts.

Hiring your first programmer will be a lengthy process. You’ll need to: post the job, filter applicants, interview qualified candidates, have them sign your NDA, explain your idea, then give them a micro-test… all before coding begins! But while this process takes time, it is time well spent. Making great hires will help you avoid unnecessary delays, costs, and frustration in the future. You’ll always be looking to add new talent to your team, so learning how to quickly and effectively assess programmers is an important skill to develop.

Let’s get started. The first part of this step is to post your job to a hiring site.

Top Hiring Resources

These websites allow programmers to bid on jobs that you post. As you can imagine, the competition creates a bidding frenzy that gives you a good chance of getting quality work at a low price.

Here are a few of my favorite outsourcing sites:

oDesk— Its work diary feature tracks the hours your programmer is working for you and takes screenshots of the programmer’s desktop at certain time intervals.

Freelancer— This site has the most programmers listed. They claim that twice as many programmers will respond to your ad, and I found this to be mostly true.

Guru and Elance. Both of these sites have huge lists of programmers.


Below is a template of a job posting, followed by an explanation for each of its components:

Click the image to enlarge.

Enter the skill requirements—What programming languages do they know? For iPhone apps, the skills I list are: iPhone, Objective C, Cocoa, and C Programming.

Give a basic description of your project—Keep it simple and skill-specific. Tell the applicants that you will discuss details during the selection process. Do NOT reveal the specifics of your idea or marketing plan. Use general descriptions, and request info on how many revisions (a.k.a. iterations) their quote includes.

Post your ad only for a few days—This way programmers have a sense of urgency to quickly bid on your job.

Filter applicants—I always filter applicants using these criteria:

– They have a rating of four or five stars.
– They have at least 100 hours of work logged.
– Their English is good.

Compose individual messages to all suitable applicants, inviting them to a Skype call for further screening. Most of these programmers will overseas, which can present issues with communication and time zone differences. Therefore, a Skype interview is an absolute must before you can continue. Disqualify anyone who is not willing to jump on a Skype call.

The Interview: Essential Questions to Ask Programmers

Don’t give away any of your ideas during this initial conversation. Whenever the topic comes up, say you’ll be more than happy to discuss everything after they sign the NDA (if you want a copy of the NDA template I use, see the bottom of this post). Here are the questions you should ask each applicant before committing to anything:

– How long have you been developing apps?

– How many apps have you worked on? Can I see them?

– Do you have a website? What is it?

– Do you have references I can talk to?

– What’s your schedule like? How soon can you start?

– What time zone do you work in? What are your hours?

– What’s frustrating for you when working with clients?

– Are you working with a team? What are their skills?

– Can you create graphics, or do you have somebody who can?

– Can I see examples of the graphics work?

– What happens if you become sick during a project?

– What if you hit a technical hurdle during the project? Do you have other team members or a network of programmers who can help you?

– How do you ensure that you don’t compete with your clients?

– Can you provide flat-fee quotes?

– What’s your payment schedule? How do you prefer payment?

– Can you create milestones tied to payments?

– Do you publish your own apps on the App Store?

– How do you submit an app to the App Store? (Can they verbally walk you through the process, or do they make you feel brain challenged?)

Finally, mention that you like to start things off with a few simple tests (creating/delivering your app’s icon and a “Hello, World!” app) before coding begins. You need to tell them this upfront so they aren’t surprised after they have provided their quote. Most programmers are happy to get these tests done without a charge, but some will want a small fee. In either case, be clear with this requirement and have them include it in the quote.

During the interview, pay attention to how well they are able to explain themselves. Are they articulate? Do they use too much techno babble? Do they speak your native language fluently? Do they seem confident with their answers? How is their tone and demeanor? If you have any issues or worries, you may want to move on to somebody else. But if you can communicate with them easily and your gut is telling you “Yes,” you’ll want to proceed to the next step.

In either case, thank them for their time and mention that you will follow up with an NDA agreement if you decide to move forward.

Step 6: Sign NDA, Share your Idea, and Hire Your Programmer

You must protect your ideas, source code, and any other intellectual property. These are the assets that will build your business, so you need to have each potential programmer sign an NDA before you hire them. Yes, it’s rare to have an idea stolen, but it does happen (read the bottom of this post if you want a copy of the NDA that I use).

As you’re going through this process, you will be getting feedback on your programmers’ responsiveness. For instance, if it’s taking too long for them to sign the NDA, it might indicate how slowly the development process will move. Buyer beware!

Once the NDA has been signed by both parties, you can share your idea and designs with your programmer. At this stage, it’s critical to ensure they have the skills to complete your app. You do not have any wiggle room here, especially on your first app. Either they know how to make it or they don’t. You want to hear things like, “I know exactly how to do that” or “I’ve done similar apps, so it will not be a problem.” You don’t want to hear things like, “I should be able to do that, but I have to research a few things” or “I’m not sure but I can probably figure it out.” If you hear those words, switch to an app idea they are confident about or run for the hills.

After you’ve found the best programmer for the job, you can commit to hiring them. Establish milestones and timelines during the quoting process (break up the app into several parts), and decide on a schedule for check-ins that you’re both comfortable with (ask them directly how they like to be managed). You will need to periodically review their work, from start to finish. Most applications go through multiple iterations during design and development, and I won’t release partial payments until I’m fully satisfied with each milestone.

Step 7: Begin Coding

Rather than jumping haphazardly into a full-fledged project, I prefer to gradually ramp up my programmer’s workload by starting with a couple smaller tasks. You need to assess their graphics capabilities, implementation speed, and overall work dynamic (e.g. communication, time zone, etc.). If you’re underwhelmed with their skills, you need to get out quickly. Remember: Hire slow, fire fast. It will pay off over the long run.

Here’s my three-step process during the coding phase:

1. Icon—Ask the programmer to create and deliver the icon of your app. You will probably have several ideas for icons, so pass them on and ask for a finished 512 x 512 iTunes Artwork version of the icon.

2. Hello, World!—Ask the programmer for a “Hello, World!” app. It’s a simple app that opens up and shows a page that displays “Hello, World!”, and it will take them 10 minutes to create. The idea here is not to test their programming skills, but to determine how they will deliver apps to you for testing. This app should include the icon they created, so you can see how it will look on your phone.

3. App Delivery—When the programmers are ready to show you a test version of your app, they have to create something called an “ad hoc” (a version of your app that can be delivered to and run on your iPhone, without the use of the App Store). This ad hoc version of your app needs to be installed on your phone before you can test it. The initial installation was a bit cumbersome in the past, but a new service called TestFlight has simplified the process. I ask all programmers to use this service even if they have not used it before. They will be able to figure it out, and you’ll be able to install your test apps with a few touches on your phone.

The first version of your app is finished and delivered, and you’re now staring at it on your phone/tablet. Give yourself a pat on the back — you’ve made serious progress! But don’t get too caught up with yourself, because now it’s time to begin the testing phase.

Step 8: Test Your App

If you were having a house built, you’d want to make sure everything was in working order before you signed off. You would check major things like the roof and plumbing, all the way down to minor things, like crown molding and paint. You need to do the same thing with your app.

To start, your app must perform as expected. Pull out your initial design document and go through every feature. Never assume that something works because it worked last time you tested the app. Test each feature every time, especially before the final release.

Most importantly, don’t be the only tester. Your app makes sense to you, but it might not to others. You need to get everyone you know, from your 12-year-old nephew to your 75-year-old grandmother, to test your app.

The time you spend on testing is crucial because you will see how consumers use your product, what features are intuitive, what they don’t understand, and their patterns. They will have questions that won’t occur to you because you designed the app and everything about it is obvious to you.

Hand the app to them and say, “Hey check this out.” Don’t mention that it’s your app, what it’s supposed to do, or how it works. Give as little information as possible and watch as they try to understand and navigate through your app. This experience will be similar to the one your real user will have, because you won’t be there to explain things to them either.

Watch them testing your app and ask yourself these questions:

– Are they confused?

– Are they stuck?

– Are they complaining?

– Are they using the app the way you intended?

– Did they find a mistake or a bug?

– Are they having fun?

– Are they making suggestions for improvements? If yes, which ones?

Get them to talk about their experience with your app. They will be more honest if they don’t know the app is yours. Don’t get offended if you hear something you don’t like; their feedback is priceless. Assess each response to see if there’s a problem with your app, then ask yourself these questions:

– Would other users have the same issues? If yes, how can I fix them?

– Should I move things around?

– Should I change colors to improve visibility?

– Would adding some instructions help?

– Should I improve navigation?

Testing and debugging will take several iterations, like the design and development stages. This is all part of the process. Don’t forget to use TestFlight to save lots of time with the mechanics of installing test versions of your app.

Just remember: If you keep tweaking things and adding features, you might unnecessarily increase costs and production time. You need to get the app on the market quickly and in a basic form to test the concept. Only redesign during this phase if you feel you have a good justification for it. Otherwise, add the idea to your update list and move forward with development (I keep an update list for each app and refer back to it when the time is right).

Step 9: Post your App to the Market

At this point, you’ve had all of your friends and family test your app, taken the best feedback into account, and wrapped up any final changes with your programmer. Congratulations – it’s time for you to send the app to the App Store for review!

It’s a good idea to have your programmers show you how to submit your first few apps. Do not give out your developer account login information to your programmer or anybody else. The best way to have them show you how to submit your app, without having to giveaway your login, is to do a screen-share over Skype or GoToMeeting and have them walk you through the process. As your business grows, you might want to delegate this task to someone on your team.

Below is a screencast on how to upload an app to the App Store. As you’ll see, it’s a fairly confusing and tedious process. Best to leave this task to your programmers:

The amount of time Apple will take to review and approve/reject your app will depend on whether you’re submitting on behalf of yourself or a company. If you’re an individual, it will usually take 3-7 days. If you’re a company, it will likely take 7-10 days.

The real fun begins once your app is approved and available for download…

Step 10: Marketing Your App

The App Store is filled with thousands of great apps, but most developers are not skilled when it comes to marketing. Meanwhile, many poorly designed apps rank highly because their developers have figured out the marketing game. How do they do it?

You really need to focus on a few key areas to effectively market your apps, which will allow customers to discover and download them. Understanding how an app’s basic elements are marketing opportunities is essential to being successful in the app business. Your job is to create a seamless flow from the icon all the way to the download button. Let’s take a closer look at these components, which you can adjust at any time from your developer account:

The first thing users will see when they are checking out your app is the icon — the small square image with the rounded corners to the left of the app title. It’s also the image that users will see on their phone after they install your app.

The icon is important because it’s how the users will identify your app. It needs to look sharp, capture the app’s essence, attract the users’ attention, and compel them to investigate your app further.

Great app icons are clear, beautiful, and memorable.

Many developers create icons as an afterthought and focus all of their effort on the app itself, but the icon is the first impression you will make on the users. The old expression “You don’t get a second chance to make a first impression” applies here. Make sure you have a quality icon that represents your app and makes the users believe it has value.

Over 80 percent of searches in the App Store are related to an app’s functionality, rather than an app’s name. Therefore, it is critical that you help users find your app when they perform relevant keyword searches in the app store.


Each word in your app’s title serves as a keyword, much like keywords in search engines. You can think of the title as your URL. For instance, if you type “angry” into the App Store search field, the Angry Birds apps will return as a search result.

Having a compelling description for your app is like having a great opening line — people are more willing to learn about you once you’ve piqued their interest. The first chunk of your app’s description needs to be packed with the most relevant information customers should know.

If applicable, use statements like “Top App 2012” or “One of the Most Addictive Games in the App Store.” Follow it up with a call-to-action, such as, “Check out the screenshots and see for yourself.”

Screenshots are great marketing tools because they give users a visual of what they will experience. Think of them as the trailer for your app. Here are a couple examples of effective screenshots:

Nike+ GPS screenshots.

Free Music Download Pro screenshots. Note the use of captions to explain the app’s features.

Many people shopping for apps won’t read the description, but will instead scroll down to the screenshots. The screenshots need to convey the main functionality of the app without showing too many details that may confuse users. If your screenshots are cluttered, it will be as ineffective as a realtor trying to sell a house with messy rooms. The brain gets overwhelmed and buyers have more trouble seeing the product’s true value. Therefore, the screenshots you include should be clean, appealing, and informative.

Unlike your icon and title, keywords are not something the users get to see. When you submit your app to the App Store, you’re allowed to provide keywords relevant to your app. When users search for one of the terms you entered, your app appears in the search results.

For example, if you type in the word “kids” or “game” on the App Store, you will find that Angry Birds is one of the search results. The terms “kids” and “game” are not in the app title. The makers of Angry Birds most likely chose those keywords to associate with their app.

A good example of effective keyword usage is an app I created called Flashlight. Since the name is Flashlight, we came up with keywords, such as “bright,” “help,” “light,” and “camping.”

One time, I added the term “phone” to the keywords of my free prank fingerprint app. This seemingly minor change propelled the app to the number one top overall free category, which moved the company’s income from $1,000 per day to $3,000 per day. This is the power of refining the marketing components for your app. Simple changes can dramatically increase your revenue.

The App Store organizes apps into specific categories to help users find them more easily. In addition to the top overall rankings of all apps, each category has its own top rankings and, therefore, generates a certain amount of visibility based on these charts. Users looking for certain apps often browse through these category charts without looking at the top overall charts. For instance, an app that doesn’t show up in the top 200 overall might still be in the top 10 of a particular category.

When you’re submitting your app for review, make sure to select the most relevant category for your app. On the other hand, many apps can be classified into more than one category. You have to choose one, but you can always change the category during an update.

One of my apps, Alarm Security, wasn’t performing well, and I was trying to bring it back up in the rankings. I initially tried changing the name and keywords, but it didn’t move much. The one thing I hadn’t tried was switching it out of the Entertainment category. The app contained various alarm sounds (like loud screams and gunshots), so I assumed users would use it more as a goof than as a tool. I was wrong.

Once I moved the app into the Utilities category, the number of downloads skyrocketed. After five days, the paid downloads had tripled, and it was only because of a category change.

Just as your app will always need certain refinements due to consumer demand and competition, so will your marketing. For most of my apps, I have changed the icon and screenshots three to five times and the title and description between 5 and 10 times. I change keywords almost every time I update apps. I always switch the categories when it makes sense. Keep an open mind and continue to be inspired by your observations during your market research.

Finally, there’s a simple rule of thumb I follow for making changes: Tweak once per week, then measure. You have to allow ample time to see the effect of any changes you make. Measure your results, then make adjustments based on your data in the following week. Your goal is to increase traffic and revenue, all while improving your users’ experience with the app.

Bonus Marketing Tactics

After you’ve taken care of the basics, your best marketing tool will be offering a free version of your app. It will generate traffic and visibility that you otherwise wouldn’t get.

Free apps create the most traffic because they have the smallest barrier to entry. It takes five seconds to download, and it’s free. Why wouldn’t you push the button? Once the free version of your app gains some traction, you can use it to advertise the paid version of the same app. This is like getting those free food samples at the supermarket. If you like the sample you tasted, you might buy the whole bag and become a long-term customer.

Nag screens (pop-ups that remind users to check out the paid version of the app) have been the most critical marketing tactic for my business. You might worry about annoying users with these ads, and that is a valid concern, but you need to think of nag screens as adding value for your users. If they downloaded your free app and they are using it, a percentage of your users will be interested in buying the paid version of your app. For those who don’t, a quick pop-up message is a small price to pay for using the free version.

You have to accept this and not shy away from this type of marketing. If you’re still on the fence, consider this: When Apple launched its iBooks app, it used a nag screen within the App Store app. If you had an iPhone at the time, you may remember seeing that pop-up inviting you to download iBooks. Well, you were nagged by the one and only Apple.

Basic nag screen (left) vs. Advanced nag screen (right). Advanced nag screens typically have three times higher click-thru rates.

When adding a nag screen, explain to your developer what you are looking for, and reference specific examples of other apps that have nag screens. Be sure you can change the nag screen without submitting a new update to the app store. To do this, tell the developer you want your nag screen to be dynamic. This will allow you to change your marketing message redirect your app’s traffic within seconds. This is an absolute must. Your nag screens will lose a huge part of their effectiveness if you cannot change them on the fly.

How do you assess the effectiveness of your nag screen? All you have to do is keep track of how many times you show a particular nag screen and how many users click “Yes” to check out the app(s) you’re promoting. This is called your click-through rate, and the higher the percentage, the better.

Final Thoughts

This is the first time in history when so many of us have the tools and access to knowledge that can quickly lift us out of the rat race. Your background, gender, race, education, and situation are irrelevant. All you need is the desire and a game plan.

You don’t have to wait till “someday” to fulfill your dreams. You can start right now…

Contest and Bonuses

We’re throwing a contest for any readers who are ready to dive into the app world. Whoever comes up with the best idea for an iPhone app (as decided by me and my team) will have 100% of their development costs covered. That’s right: You won’t need to spend anything to have your app made – all it will cost is your time and effort. This will be a great learning experience for the winner, so if money is all that’s holding you back, we want to help you get started.

Here are the details:

– You have 1-week (ending Monday, April 30, 2012 at 9am EST) to research and design your app idea. Your app should try to fill a void in the market or improve upon apps that are currently available.

– Once you’ve decided upon your idea, post a comment below with a detailed explanation of the app you want to develop. Bonus points if you can show us (with a drawing, video, etc.) how your app will function. More bonus points if you show us the research you did to prove your app’s potential for success.

– You can only submit one (1) idea (one entry per person), so make it good!

– Up to $5,000 USD of your development costs will be covered. 100% of all revenues earned will go to the winner.

– Winner gets a 1-hour phone call with me (Chad) at any point during development or marketing.

For those who are worried that someone is going to steal your idea and make a million dollars with it– you don’t have to enter the contest! Just remember: my success in the app store came from emulating successful apps. In other words, borrowing proven ideas and trying to make them better. If someone else can succeed by taking one of my ideas and improving upon it, that’s only fair game. Don’t let the fear of losing prevent you from trying to win.

Contest deadline has passed; Winner (Alex K.) has been contacted. Thanks, all!

Finally, for those who’d like a copy of my NDA template (along with the checklist I use when hiring a new coder), email a copy of your receipt for App Empire, my comprehensive book on app development and marketing, to bonus (at) The book goes into depth on advanced marketing and monetization techniques, including how to put your business on cruise control (automate).

We look forward to seeing what you guys come up with! Talk to you in the comments :)

Posted on: April 22, 2012.

Watch The Tim Ferriss Experiment, the new #1-rated TV show with "the world's best human guinea pig" (Newsweek), Tim Ferriss. It's Mythbusters meets Jackass. Shot and edited by the Emmy-award winning team behind Anthony Bourdain's No Reservations and Parts Unknown. Here's the trailer.

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Comment Rules: Remember what Fonzie was like? Cool. That’s how we’re gonna be — cool. Critical is fine, but if you’re rude, we’ll delete your stuff. Please do not put your URL in the comment text and please use your PERSONAL name or initials and not your business name, as the latter comes off like spam. Have fun and thanks for adding to the conversation! (Thanks to Brian Oberkirch for the inspiration)

928 comments on “How to Build an App Empire: Can You Create The Next Instagram?

  1. Interesting read. This seems like this is right up Kevin Rose’s alley. Did you happen to consult him in creating this article Tim?


    • Hey Chad, I have some questions.

      If I’m selling an app I created do I
      need to create a company?
      If so, how and why?
      Could It just be me alone?
      How are revenues processed?
      Where does the money go?
      How do I claim it?



      • Hi Mike,

        You don’t need to be a company and can register with Apple as a sole proprietor/individual. Once registered as a developer you tell them your bank details, and after they take their 30% the rest is deposited in your bank account.




      • i had the same question if you get the answer to this please email it to me. i would appreciate it greatly!!!


      • Hey Antonio,

        how long does it take to create an app? For example, let’s say create an app like the “finger print app” of Chad. I couldn’t find any advice how much time is needed for coding. Can you help me?



  2. Tim,

    Thanks for sharing this. I have had about 3-4 different ideas that I thought would make solid apps. All based on, “things I wish I had an app for right now”. This post could not have came at a better time as I am on a mini retirement in Koh Samui and looking for new projects that are fun. I spent about an hour or two figuring out what it took to make apps and got discouraged and confused (this was 2 days ago), once again you have read my mind and swooped into save the day.

    We’ll see if any of my ideas make it through the process.



    • Hey Jordan, I went through a similar phase. Pushed through the initial feeling of overwhelm, found a developer and got a health app developed…phew…

      Now on to marketing and monetization which is a sly beast. I haven’t the slightest clue where to start to monetize my app.

      There are 6.8 billion people on the planet. 5.1 billion of them own a cell phone, but only 4.2 billion own a toothbrush. That’s ridonculous.

      Now I’m off to find ways to effectively market apps…keywords seem to be a big factor.

      Progress = one step followed by another.


  3. Hey Chad, fantastic article. Thanks for providing so much detail. Congrats on your success.

    Quick question: once you launch an app, how do you handle customer support? How much time / effort does support cost your business? Do the customer support needs differ depending on the cost of the app or the type of app?

    Thanks if you’re able to answer this.


    • Hi Corbett,

      Truthfully, the majority of apps won’t require much customer support. For instance, if a customer wants a refund, they need to go through Apple, not you. If a customer is confused about the functionality of the app, you can try to incorporate an explanation (through a demo or instructions) in the next update. Customers usually express their concerns, praise, or complaints in the reviews of your app, not as emails. I try to keep my apps as simple and self-explanatory as possible, and take legitimate feedback in the reviews into account. Of course, if you feel your app absolutely needs support, then you should consider hiring and training an employee to help with customer service.

      – Chad


      • Hey Chad,

        Great post, one of the best i have ever read. Very inspiring, I bought an itunes copy of the book and a hard copy on Amazon to take notes on. Where do I email you the receipt so I can get a copy of the NDA?




      • Would doing my reserch in the android app market be just as good or do I have to purchase an Iphone to effectively develop in the apple app market?


      • Hi Chad

        I’m not sure if your still replying on this site but if you are i’d appreciate a little bit of advice.

        I have an app idea that i’ve just created designs for and that i’m about to get pricing for.

        I’ve just found out that you’ve released a new system.

        I have budget to do one or the other – genuinely which is best to do first?

        I only just found out about this competition so i’m really gutted…




      • hey chad would you like to team up with me in creating an app. I’ve developed the app design just need a partner who knows what their doing.

        Im trying to create a social network on an app.

        if you are interested or would like to team up feel free to give me a call

        cheers mate!!!


      • Hey Chad, hope all is well. I seem to be missing the NDA contract i’m not sure if i’m just late and you took it down or i’m just missing it


  4. I am very wary of comments like “No matter what your dream lifestyle is, you can have it as an appreneur.” Generalized over-promises are a stable for marketers which usually fails to benefit the consumer. (let’s face it) Anything CAN deliver your dream lifestyle. (it’s a good marketing jargon) Does it deliver your dream lifestyle? To only a few. (statistically)
    Besides that point, it is a good opportunity. What do you have to lose? Maybe a email address you have to burn, but other than that why not?
    I do have to point out because you made an app doesn’t mean it will be profitable. You still have to market it until it catches momentum. Thousands of app are out there and not all of them(only a few of them) make a profit. Just because Chad Mureta made money will apps does not mean you will. Just because you are winner of this contest doesn’t mean you will make a profit either. This needs to be said because the impression is that App development will solve all of your problems. I’m 98% sure it won’t.
    You can deal with that, you should enter. Good luck and remember to have fun if you can.


    • Thanks for the comment, David. You are right in saying that only a small percentage of developers will succeed on a huge level in this market, but that’s the way things are in every field / industry. My goal in this post was to show people that — while the competition is abundant in the app store — now is the best time to experiment with developing apps. It’s difficult to strike the perfect balance of getting readers excited and motivated enough to take action, while still managing expectations that simply building an app does NOT guarantee success. My hope is that readers will want and try to build a sustainable lifestyle business, but still recognize that they’ll have to put in hard work.


      • Thank you for your reply, Chad. I hope my previous comment was not too much. This blog as a habit of censoring readers’ opinions(over 6 times already) which are at the same level of criticism as my previous comment. The omitting common sense makes for great marketing(or storytelling) but doesn’t benefit the readers. That being said, I commend you for starting this competition. If a few people can achieve their 4 hour work week with creating Apps, that will be fantastic. Besides apps are really fun. :)
        I won’t be entering, but I wish the best of luck to you, Chad, and anyone that enters.


      • Just to pitch in my $.02, zero businesses guarantee success and most fail. But the combination of low barriers to entry and global reach make this a business idea worth trying. I’ve been banging my head against a wall trying to get myself to take the time to learn the programming myself, and I’ve had a couple of ideas bumping around in my head for a year. I need to remember the lessons in Four Hour Workweek and get others to do the work.

        Thanks for the post Chad – very inspirational. I wish you continued success!


    • David,

      Don’t you think think us, as the readers, should do some type of due-diligence? I don’t think we should be spoon-fed obvious facts like
      “creating an app does not guarantee a fortune”. Anyone that needs that type of disclaimer has no shot whatsoever, because they are so far removed from reality. Tim has a pretty intelligent readership and I don’t think most of us want to be babied with disclaimers.


  5. Good lord, now that’s a guide if I’ve ever seen one! Chad, you are the man. Clearly I haven’t read the whole thing since you just posted, but I still felt the need to say thank you and that I’ve bookmarked this for reading during lunch tomorrow.


  6. Such a timely post. I actually met up with a client earlier today who is having me build her new iOS app. When I got to the coffee shop I found her reading 4 Hour Work Week.


  7. Here’s an idea for an app I’ve had for a while: An audio RSS Feed Reader. Basically, the functionality would be similar to Google Reader, but users will have the option to tap on a sound icon to have an item on their feed read to them. An additional feature could be the ability to create playlist of news items to be read in order, or to read all news items in a category.

    Great for people who want to have the latest news read to them on their commute to work or while on-the-go.


  8. Hi Chad,

    I am an aspiring app developer who has started my own mobile app development company, Rare Digital Designs. I am submitting my latest app idea for this competition. QuoteBoat will be the mobile version of a social network based on sharing & discovering peresonal quotes with your friends. Currently there are a lot of websites for finding famous quotes but none for sharing personal quotes with friends. I have provided a link to a demo video I made displaying the functionality of the app. Let me know if you have any questions and thanks for putting on this competetion!

    Demo video:


    • Great idea, Zain! I’d like to be able to read through a list of quotes from the category I like and post it directly as opposed to typing it though.

      Or the option to hit the microphone button and say it (speech to text).

      Good luck!


      • Thanks for the feedback David. I will look into adding the ability to re-post quotes. Currently there is an option to “Anchor” which allows users to save a list of favorite quotes to their profiles.

        As for the speech to text function I decided not to add it since the iPhone 4s has this ability built in. I will definitely add it to the road map for legacy devices, but now it would take to much time to implement.



  9. Don’t hate; Emulate! Priceless :) I’ve always wanted to create an app, but I didn’t know where to start since I rarely use any and the ones I wanted to use weren’t made yet, which was pointed out as a bad sign, though I guess with the right marketing you can sell anything :)

    My idea was to make an App called What Were You Thinking? So basically, you’d have a color coded body front view and back view for the 5 Chinese elements Fire, Earth, Metal Water, Wood (Red, Yellow, Grey, Blue, Green) All the elements correspond to a particular body part and emotion so if a person has an injury say to his left ankle you could tap that part and an analysis of what the person was thinking. With ankles it’s a major life decision in this case probably in regards to getting married since left relates to feminine said usually mother, sister, wife or gf. Pains in the butt relate to the fire element, so the person might be experiencing sadness or pathologically, depression. I kind of thought the free version would be “How Do You Really Feel?” because that would relate to the emotions of the 5 elements and “What Were You Thinking?” goes into that a bit deeper, because it relies more on the various meridians flowing through the joint.
    I would love to post a picture but an association I belong to owns the one I’d like to use. I probably could sell it back to the community in app form, as long as the administration got their cut :)
    As for marketing whenever I give presentations about body psychology people always ask me about the colored coded chart I have and if they can buy one, which I call Chinese Medicine for Dummies. It’s the most amazing thing on planet imo and I would just like it to be a bit more accessible to people. Once they know what the hell they were thinking and can resolve that issue they can heal much faster because they know where to place the attention.



  10. What a great post! This needs to be re-read a few times. Thanks for writing it Chad and thanks Tim for having him on here.

    Time to brainstorm for an idea.


      • Chad, thanks for sharing all this info and Tim for putting it up.

        Here goes mine: Business Category: Send a Note: “Send a hand written thank you note you don’t have to write yourself”. In today’s text and email world hand writing and sending out an actual signed card will mean more than ever.

        Lets create an app that allows users to send handwritten notes directly via an app. Users will only have to log-in, write the message on the screen, their name, mailing address and hit SEND. Via the online page users will “load” their account with a minimum of $10 which allows them to send out 4 notes ($2.50/note). Apple has a similar app but it’s too expensive and notes are not Hand Written. I can have my assistant hand write the notes until orders are large enough at which point we can easily outsource this task. Total cost per card and postage for us is about $1.50 including my assistance time. Healthy margin!

        PS/The person writing the notes will physically also sign the note on the users behalf. *Sending an actual hand written note in today’s society means much more than ever before.

        PSS/I already have the design mock-ups ready to go!

        Thanks for listening.


      • Hey Benny, I had multiple app companies because I didn’t want to be tied down. I wanted to stay mobile and be able to walk away when the time was right. Having apps in the store requires constant monitoring and tweaking for as long as you have them, and I chose to give them up at certain points so I could focus on other endeavors (and, of course, do some traveling!).


  11. A pretty basic idea. An app that gives you the option to delay a text message and verify who you are sending it to. It’s terrible when you send a text message to someone you didn’t want it to go to and once that text is sent there is no going back.


  12. Fantastic article, very insightful. Tim, it’s so inspiring that you have people who open up and share so much here. Thank you for keeping introducing the beautiful minds.


    • Do you not think there’s a very good reason he’s done this?

      1) free marketing for his book – which Tim and his circle frequently plug each other as a ‘back-scratch’

      2) of course he’s going to bloody use ideas people post on here..! Don’t be so naive.. Ok, one might win.. But there’ll be another 10 ideas he can run with and create with very little Dev cost – I can’t believe people are so naive about how business works.

      If people believe in their app idea, don’t be so stupid as to give it away for free!!!
      What Chad’s covered here is by absolutely NO means comprehensive – on the contrary, it’s a drop in the ocean – creating the app’s the easy part, honestly.. The 90% of your focused effort should be on how the hell you get your app out of the arse of 400,000 others. And this is growing daily.

      Just look around you and ask ‘why is someone in this business willing to give away ‘secrets’ and tell me how to do everything?’

      There’s no such thing as a free lunch guys.


      • Like Mr. Burns, I’m gently tapping my fingers together with an evil grin… There are many interesting ideas here, but these comments aren’t exactly my private gold mine :) As I said, if you want to keep your idea to yourself, don’t share it – go out and do it! A public forum is the most transparent option for a contest, and when everyone shares, it motivates others to start taking action. The other option was to not do any contest at all.

        As with everything that seems “too good to be true,” there will be skeptics. It comes with the territory.

        (And of course I’m marketing my book! Shameless, I know, though offering $5K in development costs isn’t exactly “free.”)


  13. Contest Entry:

    I work part-time as a baseball umpire. We have a nice little clicker that helps us keep track of strikes, balls, and outs. The rest we often have to keep in our heads while making sure ALL baseball rules are being followed. It can be tricky work unless one has years of experience umpiring.

    I was out in the diamond one day and thought how cool it would be to have futuristic sunglasses that would keep the score and inning in my peripheral vision; then i saw this post.

    How about an app that helps referees of various sports? Too often, scores are not kept track of during games unless they are at the collegiate level or above. An app that would help refs keep track of various stats would be simple and useful.

    I would like to develop a simple app that helps me keep track of the innings and score in baseball. It would have to have a simple interface so that I wouldn’t spend too much time in between innings or plays entering in information. I’m sure other sports could benefit if there is no one working the scoreboard.

    Thank you for your time! Good luck to others entering the contest!


  14. Holy monster of awesome post Chad. You are the real deal. Thanks for sharing all this detailed info.

    I recently invested $5000 in a video editing app through, a crowd funding / investing platform and made a quick return of $700 in a few weeks.

    I want to learn Objective-C and build my own apps.


  15. Goodness gracious Timothy this post is terrible! How am I going to explain to my girlfriend now that I cant sleep and its not caffeine induced this time. She is going to think I am cheating on her or something. This post is awesome. I love the how to, the why, you get it.. i love it all.

    I want to retweet this but I dont want to share this with anyone. I want to hold it and caress it and keep it myself. I know your supposed to share, and the Golden Rule, blah blah blah.

    This post is awesome man. Thanks again for sharing this content. I will retweet it, i dont want to be that guy.




    • Christoph, my thoughts exactly! Only for me, it will be my finace that will wonder “why are you still up and on your computer? don’t you work in the morning?” =)
      Thanks Tim, I’m really excited after reading this post! However, now I have to figure out how to get through the rest of my work day so I can go home and start developing!



  16. idea: some people look for airport code when they’re traveling on twitter so they can connect with other people who happens to be at the same airport. For example if I’m on a layover at San Fran then I’ll search twitter for SFO, and if I see a recent twit that includes SFO as well there’s a chance that I can connect with that person and hang out, making waiting time more fun.

    execution: an app that does above but automated. It would have the option to run in the background. Once you open it up it’ll craw and search social sites base on your GPS coordinates, then it’ll show other people that you can connect nearby, it’ll also give you the option to ping/poke/hit/call/chat/say hi/twit to them before you actually walk over.

    scale: it doesn’t have to be limited to airports or things like that. If you’re at the store then you can open it up and find other users nearby. If you’re at a park/fair/other event you can find other people on a map nearby. You can also filter nearby users base on their profile, characteristics, likes/dislikes, culture background, etc.


    • This is weird but this is my exact idea. It is a great Idea. I read this blog on friday and thaught I would submit it. I was reading the other posts and saw this. We have a very similar vision and Idea. Contact me if you want to brain storm together. Good luck man.


    • Hey a:
      There’s a similar app that a gay friend of mine was showing me. The idea is that it shows you (in real time) other users. So one guy might post “I’m at bar X, and I’m drinking margaritas” and then you can connect face-to-face. It’s basically a way to meet people who share similar traits as you.
      Maybe you could incorporate/emulate some functionality. Check out grindr. Some of the language is kinda NSFW though.
      I think your app is a great idea!


  17. Hi Tim/Chad,

    For the contest, can I enter an idea I had and built a website for?
    I have never made an app in my life and could use this as an opportunity to build a mobile app, if I am still eligible for the contest.



  18. Killer article Chad. I swear Tim writes this blog just for me (okay, maybe not) because I was literally JUST on odesk placing an ad for an app programmer when this article went live.

    I’ve got countless app ideas (who doesn’t), but after winning some money in a poker game figured now was the time to commit and hire a programmer. Chad your guide will be invaluable, you’ve taught me a lot of tricks to use when hiring.

    One issue I have faced is estimating how much an app will cost to create. Most workers seem to prefer an hourly rate, which I’m happy to pay, but I need to know if making my app is a 50 hour job or a 200 hour job.

    I have already sketched out a dozen pages with designs for my app (I need to fully understand my own work before asking a programmer to do the same) – I’ll scan them up and enter your contest. Thanks guys!


  19. Truly inspiring… Upon reading the title my first thought was, “Interesting, but there is no way I have enough time in my life to do that.” After reading, I am now thinking, “Holy crap this is the first thing I am doing when I wake up tomorrow!”