A successful mobile startup begins with a great idea. But its implementation requires thorough planning that will lead it to success. Surely, not everyone becomes a winner. The mistakes remain the same, and here we have formed a list of the most common reasons why some of the mobile startups eventually fail. Let’s look at the reasons, causes, and ways to avoid them. All these should be considered before even turning to software developers that will bring your idea to life.

1) Premature monetization policy. A mobile startup is a business – first you must decide the way it will bring you profits. How will you make money on the software product after it’s launched? How will you gain revenues later on? Will the application be paid or free? Will there be in-app purchases or some other means of monetizing? Only having bethought every detail of your future mobile software, can you choose from a number of monetization models, choose the one that suits best. If you have a limited budget – the app should bring profits as soon as possible. This means it has to be paid. But for that it must be superior to its counterparts, or feature some unique characteristics that will make it superb in solving certain problems. Or if it’s a social network, it will be a free app, but you must work out how many people you expect to attract, and how you will eventually get profits. Determine the right pricing to keep the product competitive.

2) Undefined target audience. Build an app for a specific audience of users. The better you specify it, the fewer are the chances to make a half-baked product – thus you can see the needs, the goals of the app, the problems it will solve – and thus you will implement the most needed features. Choose the market niche you want to occupy. Narrow the current, and it will get stronger. Think of your mobile customers first, only then think of revenues.

3) Getting outcompeted. Be sure to gather as much information as possible about the competing/similar products – and analyze it. You must have an ace in your sleeve that will make your app better, otherwise there will no need in it. Be cheaper/easier to use, have more features, provide more convenience.

4) Wrong budget planning. If there is a fixed budget for your project, invest the money with maximum efficiency. Choose what’s needed most, if the whole plan doesn’t fit in the budget. You may build an app with minimum necessary features, having left space for further improvements and updates. Your software developer will consult you on that choice.

5) Changes in the middle of the development process. You suddenly have a new idea and you want to bring it into the application. You may have more and more ideas – but any developer will say that changes in agreed features in the middle of development are highly undesirable – some are easily to add and implement, but some are not, if they need the already written code to be altered. This may take time and cause delays. And if you have a strict time limit, you risk to have an unfinished application in the end. Often it is better to launch the app as agreed, and develop a new version with new ideas and features later on.

6) Flawed customer feedback. This must be avoided at all costs. Communication with users shows that you care about their point of view. Feedback allows you to gather opinions, recommendations, thus make your software better with updates. A good and well-supported product lives longer. User reviews and rating on the application store hugely affect the overall picture. pps with an average rating more than 4 stars out of 5, will be high in users’ favor. To react to the feedback, you should have app support at your service, for possible bugfixing and updates.

7) Flawed marketing strategy. There are numerous ways to promote your startup app, and you must do your best to make it known. If you know your target audience, you know how to reach their attention by offering a product that will be worth its cost, functional, yet easy to use. Marketing takes as much time and efforts as development, if not more. Make sure to have promotional power behind your shoulders.

8) Inflexibility. Mobile market is constantly changing, changing right now. Customer requirements change, new trends and mobile devices appear, and more, and more. That’s why you must be quick and resolute to make a decision that will push your startup higher, you must react and adapt efficiently and quickly. Be ready for changes in your plan, if that will be of vital use for your software. These changes may not be that radical. But it’s never bad to be prepared.

These are eight main reasons why mobile app startups fail. Following these notions does not guarantee success – there are many factors that may tip the scales against you. And the percentage of failed startups is high. But that’s business, and moving on, keeping these things in mind, will increase your chances for success on the mobile market.

http://mobidev.biz/blogs/8_reasons_why_mobile_app_startups_fail.html

Google has just bet on a less-hierarchical future for the credit industry.  The search giant bought a $125 million stake from investors in peer-to-peer credit site Lending Club , together with Foundation Capital. The site cuts out banks by matching lenders with borrowers, offering a better spread between interest and savings rates.

Rather than issue more equity, Lending Club invited current investors to sell their shares. The sale valued the company at $1.55 billion, Lending Club said. Google took more than half of the new stake.

Lending Club says it wasn’t looking for new funding. “We want to have Google as a shareholder,” said Lending Club’s founder and CEO Renaud Laplanche. “We didn’t need additional capital.”

Lending Club generated $34 million revenues in 2012 and is forecasting sales of $90 million for 2013. Laplance said the company became cash-flow positive in the third quarter of 2012 and has since been profitable.

read more at http://www.forbes.com/sites/parmyolson/2013/05/02/google-buys-stake-in-lending-club-valuing-peer-to-peer-lender-at-1-6-billion/

If you are one of the many people horrified about the privacy-invading nature of the tracking cookie, her’s some solace: It may not have long to live.

According to Paul Cimino, vice president at ad marketplace Brilig, the tracking cookie has, at most, five years of life left.

“I think it will take five years to kill it. At that point, it’ll be like birds chirping and flowers blooming because we’ll find some kind of value proposition that allows consumers to trust us and opt into personalization. I term it, tailor don’t target,” Cimino told AdExchanger.

While you may not be quite sure what an ad tracking cookie is, you’ve probably seen its effects anytime you’ve noticed, say, the same jeans advertisement popping up on multiple sites. In that situation an ad network placed a tracking cookie in your web browser, which allowed them figure out which sites you went to and how long you stayed there. Then they served you ads.

Yes, it’s a bit scary.

Perhaps surprisingly, Cimino agrees. “At my former company, my peers were the people who created cookies. We didn’t create them for this. It’s a very weak computing mechanism. It’s flawed, invasive, it’s got privacy issues, it’s going to go,” he said.

Let’s just hope whatever mechanism replaces the tracking cookie will care a bit more about your online privacy.

Filed under: Business

via startup news

Three prominent venture capital funds want software developers to know they are on the hunt for apps

via startup news

If the venture capital community’s New Years Resolution was to be more active, it needs to try a little harder.

A report issued by venture capital research firm Pitchbook found that deal flow continued to decline in the first quarter of 2013. With $6.3 billion across 753 deals, it marks the lowest quarterly totals in more than two years.

“At this time last year, the venture capital (VC) industry looked poised for prolonged growth,” the report said. “Deal-making was steadily increasing quarter-over-quarter—reaching all-time highs in both 1Q and 2Q 2012—and fundraising was also on the upswing. Investors let off the gas in mid-2012, however, and have coasted along ever since. To that end, 1Q 2013 marked the third consecutive quarter of declining deal activity.”

Pitchbook also found that exits hit an “abysmal” four-year low. Furthermore, the number of early stage investments shrunk by 8 percent as compared to the first quarter last year, and the number and value of late stage deals declined as well. Angel and seed round investments, however, expanded from 24 percent to 29 percent of total venture capital deals, and late stage financings are growing as a proportion of overall venture capital activity. This data speaks to the much-discussed ‘Series A Crunch,’ because it presents the bottleneck forming between angel and seed rounds, and early stage deals.

PricewaterhouseCoopers and the National Venture Capital Associate had similar findings in the MoneyTree report, based on data from Thomson Reuters. Both reports found that software was a “bright spot,” with deal volume and capital increasing in Q1 2013 by eight percent from the previous quarter.

“It was not unexpected that the levels of venture capital continue to decline as the industry continues to go back to where it was in the early 90s,” said Tracy Lefteroff, global managing partner of venture capital practice at PwC, in an interview. “It was a pleasant surprise to see a software uptick in dollars and deals. This is reflective of the returns environment right now. Money follows returns.”

Lefteroff said this explains why the life sciences and clean technology sectors continue to decline. These sectors are capital-intensive, whereas software and IT are more capital-efficient and often have shorter timelines for a liquidity event. The number of IPOs and mergers and acquisitions for clean tech or life sciences companies remains low. Investors are more reluctant to put their money into these areas, particularly since venture capital is going through a “contraction phase” and firms are struggling to raise new funds.

“If stock earnings and the stock market continue to hold up, we could see some general improvement in amount of venture capitalists being put to work,” Lefteroff said. “If we continue to limp along and have disappointments from a recovery standpoint, it is still going to be a tough environment. This isn’t a collapse in the industry by any means, there is a very significant role for venture capital and will continue to be, it’s just at what dollar level are people going to participate in the amount of funds allocated to these sectors.”

11 of the 17 MoneyTree sectors declined, however Pitchbook found that the median deal sizes have increased or remained steady, and valuations have seen steady growth since 2011 in all stages of the company lifecycle. Some of the more notable seed and angel deals from the first quarter were Virool, BlueData, and Blaze Bioscience. Amongst early stage deals, Pitchbook identified Leap Motion’s $30.8 million Series B and Warby Parker’s $41.5 million as significant. Airwatch, Pinterest, SevOne and Acifio ranked him for late stage deals. MoneyTree also cited LivingSocial, Nest Labs, and AppNexus as making “top deals” last quarter.

Accelerator and seed fund Y Combinator and 500 Startups were the most prolific angel/seed round investors in the first quarter, making 19 and 18 deals respectively. Bessemer Venture Partners, First Round Capital, Kleiner Perkins Caufield & Byers, and New Enterprise Associates made the most early stage deals, and Intel Capital led the field for late stage deals.

Read the MoneyTree press release. 

Photo Credits: Pitchbook and graibeard/Flickr

Filed under: Business, Deals, Entrepreneur

via startup news

via VentureBeat

What do you work on after launching one of the largest social networks in the world? It took some time, but each of the three Twitter founders appear to have come up with their own answers to this question.

Ev Williams stepped down as Twitter’s CEO in late 2010 and scaled back his role at the company in the months that followed. He pursued new projects at The Obvious Corporation, a startup incubator that Twitter’s co-founders launched in the mid-2000s, and which served as the original home of Twitter. A few months later, Biz Stone announced that he too would be stepping away from day-to-day duties at Twitter and joining Williams at Obvious to focus on new projects.

Since then, the two Twitter founders and their team at Obvious have helped launch several startups including Medium and Branch, and have worked with or invested in a number of other promising startups like Neighborland and Findery. The underlying goal all along, according to Williams, was to use Obvious to figure out what he and Stone wanted to work on next.

“We rebooted Obvious in 2011 with a vague plan,” Williams wrote in a blog post this week. “We started investing, incubating, and experimenting to figure out what worked and what we wanted to do at this stage in our careers; we just knew we wanted to work together do stuff that mattered.” Now, nearly two years later, Williams says he and Stone have settled on their next projects.

Williams says that he is now spending “about 98%” of his time working on Medium, the publishing platform that Obvious announced a year ago.

Williams says that he is now spending “about 98%” of his time working on Medium, the publishing platform that Obvious announced a year ago. Just like Twitter before it, Medium has been spun out from Obvious, and is now said to be operating as its own company, with a staff of about 30 people.

Stone, meanwhile, has committed himself to working on a new mobile startup called Jelly, which is also affiliated with Obvious. Details of the project are still vague, but Stone suggested in a blog post earlier in the week that it will be a free app that helps people “do good,” and which will take up most of his time. “Personally, Jelly will command my full attention aside from some advisory roles elsewhere,” he wrote.

Jack Dorsey, Twitter’s third co-founder, remains involved with the social network’s business operations, but most of his focus is outside the company. In October, Dorsey wrote on his personal Tumblr that he only works at Twitter on Tuesday afternoons. He spends the rest of his time running Square, the mobile payments company he co-founded in 2010 and which is now valued at more than $3 billion. As if Square isn’t enough of ambitious follow-up to Twitter, Dorsey has repeatedly expressed an interest in eventually running for mayor of New York City.

Whether these projects become the Next Big Thing like Twitter is unclear, but for each of Twitter’s founders, they represent the next big thing in their careers — and that may be just as important.

Image courtesy of Flickr, Jolie O’Dell’s Website

via Mashable