the funding gap
TRANSCRIPT
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THE FUNDING GAPINTERFACE LONDON - MAY 2015
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Everyone knows the stories about a few apps that just go viral with no promotion. For the 99.9% of all other apps launched, it’s necessary to spend to acquire users…
DEVELOPERS NEED TO SUPPORT APP AND GAME LAUNCHES WITH PAID UA
Pollen VC - Interface 2015
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THE FUNDING GAP…
LAUNCH You’re earning money from day 1
This is your money trapped in the payment system
Apple Releases your cash
Pollen VC - Interface 2015
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TYPICAL LAUNCH SCENARIO
LAUNCH
Fail to get credit with
ad networks
Can’t reinvest to acq more
users
You get paid by Apple
DOWNLOADS REVENUE
Rev
enue
/ D
ownl
oads
Pollen VC - Interface 2015
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Pollen VC - Interface 2015
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HOW DEVS FUND USER ACQUISITION
Venture Capital
Using equity financing from your VC is expensive and dilutive (and they don’t like it…)
Publisher
The developer can’t afford to fund UA on their own so they look for a publisher and give up a rev share.
Credit Card
High growth or long tail developers don’t meet the credit parameters for ad networks, so relegated to pre-paying. Doesn’t work in high growth scenarios.
Err… Not at all…
So many times, the funding gap means that great apps and games never see the limelight as devs cannot afford to promote effectively.
Pollen VC - Interface 2015
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It’s not just the cash, it’s what you can
do with it.
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REINVEST DIRECTLY INTO PROMOTION
ACQUIRE MORE USERS
ACCESS FUNDING BASED ON DAILY SALES
Pollen VC - Interface 2015
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TYPICAL LAUNCH SCENARIO
LAUNCH
Fail to get credit with
ad networks
Can’t reinvest to acq more
users
You get paid by Apple
DOWNLOADS REVENUE
Rev
enue
/ D
ownl
oads
Pollen VC - Interface 2015
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LOWER YOUR EFFECTIVE CPI BY REINVESTING WHEN YOU ARE RIDING HIGH…
Pollen VC - Interface 2015
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MONETISATION
ACQUISITION
Test Refine
Test Refine
Pollen VC - Interface 2015
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MONETISATION ACQUISITION SUCCESS
SUCCESS FORMULA
Pollen VC - Interface 2015
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STEPS TO SUCCESS
Do a small scale test campaign and measure EVERYTHING
Understand your key metrics - LTV, D1/7/14/28 Retention, ARPDAU etc.
Once you understand your metrics, progress to stage 2
1 2 3Trial several networks to test acquisition costs
Understand attribution mechanism and underlying virality
If you can acquire users profitably, progress to stage 3
Plan how you’ll finance your UA campaign early
Don’t get caught short if you find the formula that works
Hit it hard, and double down… $$$
$
Pollen VC - Interface 2015
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YOUR GAME FUNDS ITS OWN UA
Pollen VC - Interface 2015
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TAKEAWAYS
Test & Develop relentlessly before you begin to ramp up your User Acquisition campaign. Don’t launch until you know you can acquire users profitably!
Plan how you will fund User Acquisition growth campaigns. Keep your equity funding in the bank!
Pollen VC - Interface 2015