Can you sell an app idea and what is one worth?

App Idea VS Execution

Putting a monetary value on your app idea is difficult. Even the greatest concepts can fail if executed poorly. Similarly a mediocre idea can be successful if executed exceptionally well.

I read an interesting article by blogger Derek Sivers recently where he describes an idea as a multiplier for the execution. Here is a chart put together by Derek:

AWFUL IDEA = -1
WEAK IDEA = 1
SO-SO IDEA = 5
GOOD IDEA = 10
GREAT IDEA = 15
BRILLIANT IDEA = 20
——– ———
NO EXECUTION = $1
WEAK EXECUTION = $1000
SO-SO EXECUTION = $10,000
GOOD EXECUTION = $100,000
GREAT EXECUTION = $1,000,000
BRILLIANT EXECUTION = $10,000,000

So, as an example, if you have a great idea (15x) and weak execution ($1,000) your app would be worth 15x$1,000=$15,000. A great idea with brilliant execution is worth 15x$10,000,000=$150,000,000 according to Derek’s chart.

While I don’t necessarily agree with Derek’s figures, he raises a very good point. The real value in an idea is only realised when the idea is executed, which means the real value is in the execution. This I agree with completely.

A few factors I would add into Derek’s equation include timing, marketing and luck. Even a great idea, executed well, still needs to happen at the right time, it stills needs to be promoted and a bit of good luck always helps too. Read more about the factors in an app startup’s success here.

So what kind of value can you put on a well-executed app?

According to Sensor Tower, a reputable App Store optimization and reporting tool, these are the estimated values of some popular apps you may have heard of:

  • Clash of Clans – $1.8 Billion
  • My Fitness Pal (Calorie tracker) – $575 Million
  • Instagram – $3 Billion
  • Uber – $133 Million
  • Flightboard – $850,000
  • Crossy Road – $68 Million
  • Gumtree Australia – $2.2 Million
  • Ookla Speed Test – $73 Million
  • Evernote – $103 Million
  • Snapchat – $432 million
  • Flipboard – $27 Million

It is worth noting that Sensor Tower reports an estimated value of just $7 million for Angry Birds and $133 million for Uber which I think is probably a quite a bit off the mark, so these figures may not be completely reliable either.

The examples above are obviously some of the most successful apps available and there are many many more apps on the App Store and Google Play Store that don’t make any profit at all. Still, its good to know what kind of values are possible when you get the app idea and execution right.

Can you sell an app idea?

As we’ve established, the idea is only as valuable as the execution, so the concept is of little value by itself. In the right hands though, that app idea could go on to be worth millions.  

If you are looking for an app developer that specialises in exceptional execution to work with you on your app idea, you are in the right place. Contact DreamWalk today to book a free consultation with our app experts.

– By Joe Russell – DreamWalk GM

Category: App Developer