
How I grew my Shopify micro-SaaS - amrrs
https://www.preetamnath.com/blog/grow-shopify-micro-saas-to-25k-mrr-in-14-months
======
teh_klev
Is it not a bit risky naming your app with "WhatsApp" in the name? Might be
worth a rethink in preparation for that day you get served papers by Facebook
(unfortunately).

[https://whatsappbrand.com/#:~:text=WhatsApp%20doesn't%20perm...](https://whatsappbrand.com/#:~:text=WhatsApp%20doesn't%20permit%20or,without%20explicit%20prior%20written%20approval).

 _" Don't use the WhatsApp Brand Resources as part of a name of a product or
service of a company other than WhatsApp."_

~~~
godzillabrennus
He doesn’t just use the name but he uses their trademarked logo in his
marketing.

I think, he could get nuked by Zuck at any time.

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dpcan
The only reason I would never go this direction with my business is because
you could wake up tomorrow and the features of your app become a standard
feature of Shopify and you’re instantly out of business.

Think flashlight apps for iPhone, health apps, etc.

~~~
akudha
That is true. But note that they are based in Bangalore, 25K USD MRR is a ton
of money (it is a lot of money even in the US). If they maintain this for just
a year or two, they're likely set for life.

Sometimes it works out to just ride the wave :)

~~~
cambalache
25 K/month x 2 years x(1/2 partners) = 150k

150k * 0.66 (extremely optimistic gross to net-income factor) = 100K

You and me have different notions of "set for life"

EDIT: I fudged a factor of 2 in the math, the final number is 200k, my point
still stands.

~~~
encoderer
You are looking at this all wrong.

First, your assumptions on net income are too pessimistic. Small founder-
operated SaaS can be extremely profitable.

Second, and more importantly, you are ignoring concepts of LTV and NPV of
future cash flows.

Assuming 80% SDI and a churn-rate that is < 5% (ideally < 3%) you are looking
at a business worth $700-950k right now. Why? An income stream from a growing
high margin SaaS business is a coveted and valuable thing.

Finally, when you have a business with 300k ARR you begin to unlock more
options for yourself -- small acquisitions (traffic/content/funnel), ads,
product improvements.

The likely path here is that their income will continue to grow and they will
either be taking $200k a year in income or sell for > $2 million in a couple
years, or both.

Having built a small SaaS business to this size myself for many years, i can
totally recommend this path for independence and financial freedom.

~~~
cambalache
> First, your assumptions on net income are too pessimistic. Small founder-
> operated SaaS can be extremely profitable.

Are they? On the contrary. You are telling me that out of 100k of gross sales,
after discounting: Operational costs, insurance, income taxes assuming at the
end if you get 67K is pessimistic? I didt not even budget money for sales and
marketing.

> Second, and more importantly, you are ignoring concepts of LTV and NPV of
> future cash flows.

I am not, that was not even a question on my initial answer. My original
answer was to deny this: Operating a 2-person 25k MRR company during 2 years
will set you for life. My answer is no. You are assuming a lot of other stuff
that was never in the original discussion.

> Assuming 80% SDI and a churn-rate that is < 5% (ideally < 3%) you are
> looking at a business worth $700-950k right now. Why? An income stream from
> a growing high margin SaaS business is a coveted and valuable thing.

Yes, but that is trivially true. If you assume the company will grow the
valuation will reflect that. Everybody knows that. That was not in the
original discussion. This also depends on the business model of the company, a
SaaS company critically depending on a 3rd part ecosystem is significantly
riskier than an independent one.

> Having built a small SaaS business to this size myself for many years, i can
> totally recommend this path for independence and financial freedom.

I agree. But you need more than 200k USD to be set for life.

~~~
encoderer
You are focusing too much on the snapshot and not the trend.

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tradewarsonlyn
I was curious about how they acquired users and found this:

[https://www.preetamnath.com/blog/shopify-micro-saas-
growth](https://www.preetamnath.com/blog/shopify-micro-saas-growth)

~~~
codeisawesome
Thanks - this had even more value than the actual linked post above.

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Hates_
I'm curious to know how the integration with WhatsApp works? Is their business
API now publically available?

~~~
icedchai
Perhaps they just use Twilio, which already supports WhatsApp integration.

~~~
Hates_
The Twilio integration also requires an existing Whatsapp Business Profile
AFAIK.

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wgx
To me the most interesting question I didn’t see answered was: how did you
acquire those users over 14 months?

~~~
tvbuzz
From his partner’s blog:

“Once this was done the next step was to get people to choose our product vs
the competition. In order to do this we did something that some might consider
unethical - we included most of the features that the competitors had and made
the app FREE which forced the competitors to go into losses. You cannot build
a business by being nice.

Making the app free got us a plethora of users to whom we provided exceptional
customer service which lead to them writing 5 star reviews, so even though
they were using the app for free, we derived ROI out of them by gently nudging
them to write reviews which boosted our ranking and eventually got us to the
#1 rank for certain keywords.

This was when something very interesting happened. One of our competitors ran
a DDOS attack on our servers. At this point we were getting 5 reviews a day
and users congratulating us for our good work but the fact that someone tried
to screw us over made it evident that we were on the right track.“

~~~
sireat
Building from free to paid is quite tricky.

There must have been backlash when going from free to paid product.

I assume the previous users were grandfathered in else those 5 stars would
have turned into 1 stars rather quickly.

Also your moat is just as big as the next hungry upstart willing to work for
free for 12-18 months.

~~~
grwthckrmstr
Author here

\- we granfathered all users whenever we would change pricing or introduce new
plans

\- agreed on the point about moat

To be fair, we made a free version of a very basic app in a category in the
App store that was stagnating due to lack of competition. example, someone was
charging for number of clicks on the button.

We simply changed that and charged for something else instead, like premium
button designs, or new features that no competitor offered but users were
asking us for it.

Our app was free for about 1 month before we launched paid plans

~~~
tvbuzz
Congrats on the growth - enjoyed the writing which led me to find your
partners blog as well.

DDOS is always a good sign —- would make a great post as well!

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Spinosaurus
> 14 months ago, my co-founder Sankalp and I set out to build a business..

It sounds like you decided to build a business before coming up with an idea
that could be a business.

In the end, how did you decide what to build?

~~~
grwthckrmstr
Author here!

We analysed the entire app store and narrowed down on 5 ideas. We got lucky
that we picked WhatsApp, that's the honest truth.

Here's our Shopify App Ideas research sheet, if it helps -
[https://docs.google.com/spreadsheets/d/1Hnpcl1VAlPC9MuFvvsl2...](https://docs.google.com/spreadsheets/d/1Hnpcl1VAlPC9MuFvvsl2UsU0yu1iM6aKR-
iK30VtbwA/edit?usp=sharing)

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techaddict009
\- Super simple and clean product \- Congratulations the revenue and other
good figures \- Does whatsapp allow automated messages thing? or i am
understanding it wrongly?

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hideo
Congratulations on launching a successful business! I enjoyed your article a
lot. As someone who knows nothing about Shopify or their extensions it was eye
opening. I loved your focus on making sure you were doing the right thing for
your users and it seems that’s a huge component of your successes!

~~~
grwthckrmstr
Thank you :) It's counterintuitive but a narrow focus leads to larger success
:D

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quotha
Reads like a self help book of the month

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blackrock
> I’m so proud of what we have built here.

> If life is a video game, and there’s 100 levels to it, I feel like we have
> finally crossed level 1.

Nice. Congrats. Most people don’t even get to Level 1.

It is really difficult to get from Level 0 to Level 1. Most people will try,
and they will fail.

And now for you, it’s much easier to get to Level 2, then Level 3, then..
Level 100.

While everyone else will still be stuck on Level 0.

But, realize that Level 0 is wide, and you can still succeed in life on Level
0. By this scale, most people are on Level 0.5 to 0.9, or something of that
nature.

~~~
warent
This seems like a weirdly elitist/limiting way of looking at things. If you're
slightly better off today than you were yesterday, then you're advancing
toward your goal. The progress compounds all the time. There is no "being
stuck at level 0" unless you're making negative progress.

~~~
blackrock
Well, understand that you can still make a good life on Level 0.

You can be a Google Engineer making $200,000 USD per year. Or a doctor earning
$300,000 USD per year. But after taxes, you take home a lot less.

But, this guy got to Level 1. Now, he can focus on getting to Level 2.
Everyone else, is still trying to get to Level 1, if they are even trying.

