The best place is if you go to developer meetups. So all around Australia there’s weekly to monthly meetups where you can go and talk to other coders and developers and they all work for other developers and companies, and that’s the best place to find out what’s happening in the development space and all around Australia. So last week I spoke at one of these events and afterwards you’re chatting to a lot of the developers and basically you can hear what’s happening in the industry and you can tell when things are picking up or slowing down. That’s probably the best place to go as there are reports and things you can get but I think they’re probably a bit lax, they’re old information. If you want the most up-to-date information in the industry you’ve got to be in amongst it in other companies.
For us, our biggest thing is making sure that we stick to payment terms, which gets increasingly difficult when you’re working with bigger clients. But making sure that our payment terms are really solid; you know, 60% upfront or 50% before delivery and that’s really important for us; and the cashflow, making sure that’s happening. At least you can predict what’s happening month after month so that you end up with enough money to be able to pay your staff. So you can time for and plan for when money’s going to be tight and plan for the expenses you’re going to have and making sure you can pay all your staff.
I’ve made plenty of mistakes. I think for us, in the business that we’re in, opportunities come up all the time, so people come up to us every single day saying, “let’s build an app together, we’ve got this great idea, how about we go 50-50, you guys put in half and we’ll put in half and build up this app”. I think the biggest mistake we made was getting involved in these joint ventures because you put yourself in a position where you’re going into a venture with somebody you don’t know much about. You’re going straight into business together, there’s no diligence and nothing that happens beforehand. So you go into business together and it just doesn’t work. We’ve gone into a few little joint ventures over the years and they’ve all failed. They haven’t worked for a bunch of reasons. So investing time and money in those things has been a big failure for us.
We’ve built the product and what does everyone else do? Someone’s had this idea and that’s fantastic, but there’s much more to it than an idea, you’ve got to have marketing, you’ve got to have execution, you need strategy, you need a business development team. What happens is we end up doing development for free or for half price and then we’re investing directly into it, and then it gets built and nothing happens. Nobody’s promoting it or selling it. It’s been a learning process we’ve had to go through a couple of times.
Because apps are becoming more mainstream it’s not just the big guys now, it’s small businesses as well. We’re seeing a big influx of development services coming from India and offshore, which come with phenomenally cheap prices, you can get an app built for $5,000 or something. In the end, the people who get those apps done overseas end up coming to us, saying “can you please fix it?” So we’re seeing a lot of that happening, we’re getting a lot of calls about fixing apps done overseas.
In Australia it costs $40,000 plus. That’s to have a team with a design team, a code team and a testing team. Whereas if you go offshore you’ve got one developer who doesn’t care what it looks like, doesn’t care how it works, they just pump out apps. So you get your app and it’s just no good, there’s never been an app which has been developed overseas which has been featured. You’ve got to do a high quality app to get featured. We’re also seeing a lot of corporates getting their own developers. So instead of coming to B2Cloud they have their own development team which is not another app developer, but it’s another competitor for us.
We’re finding it’s moving away from entertainment-style apps, like “here’s a flashlight for my iPhone” or “here’s a thing that does fart noises”. We’re moving away from that now and the apps that are being built actually help consumers and users. We built one for Run Property which helps if you’re a property owner and you’ve got a property to rent. Historically if you rent a property to a real estate agent you’ll probably hear from them once a year and they’ll tell you that they’ve done all these inspections but you don’t hear from them otherwise. We built an iPhone app that links directly into Run’s system and you can see as soon as rent gets paid, you get a little notification on your phone saying your rent’s been paid. If rent is late, you get a little notification on your phone saying the rent is late. So it’s an amazing speed in which you can start getting information. That’s really a useful thing. We see more of that happening and less of the fart apps.
Cara Waters is a former SmartCompany editor. Previously, Cara was a senior reporter for the Financial Times’ website and worked for The Sunday Times in London.
