My Apps Make $4.5M/Year With $0 Marketing

0:00My Shopify app, Kaching Bundles, is currently making me $4.5 million a year, and we spend almost zero dollars on marketing. How does this guy make over $4 million a year without spending thousands of dollars on marketing? Well, the answer is something you probably wouldn't expect. All of our growth is coming either from or Eric started his journey as a designer making just $2 an hour. Then he stumbled onto an opportunity that would change his life forever. I think there's still a lot of opportunity building in platforms and I'm personally researching. I spent over an hour talking to Aricos about all his different Shopify apps and how anybody

0:38can start building these things from scratch. And good news, he shared everything, including how to find platform specific ideas to build, how to run an async team with 90% margin, and the unique marketing strategy that helped him grow to $4.5 million a year in just two years. All right, let's get into it. I'm Pat Walls and this is Starter Story. Welcome, Ericos. Welcome to the channel. Tell me about who you are and

1:07what business that you built. Hi, guys. So, my name is Ericas. I'm from Lithuania, originally currently living in Paris. And I'm a designer turned entrepreneur building Shopify apps together with my co-founder. And we're currently at 4.5 million annual recurring revenue. What's really cool about our business is that we're 90% profitable. Okay. If you could give me a little bit of a breakdown of apps that you built. So, currently we have uh five apps in total. Our first app in the discount category was Kaching Bundles and we scaled it to around 400k monthly recurring revenue currently. Uh then we

1:48launched Kaching post purchase upsell. After that, we launched Kaching pop-up upsell and right now few weeks ago we launched Kaching uh card drawer upsell. All of these apps are in the discount category serving customers that want to increase their average order value within Shopify. Since our launch in 2022 August, we already made more than 400 million in additional revenue for all of

2:13the merchants that are using our apps. That's awesome. In building these businesses, what have you learned? What is the big opportunity on building apps on platforms? The thing I noticed about the app developers is that there's like solo developers, indie hackers, and I thought that they lack great user experience. All of their apps are kind of technical and a bit complex for for regular users. And the other type of apps was VCbacked or like huge corporations. The user experience were uh was great. But the problem about them

2:47was that they actually move pretty slow. If if there's a feature lacking, it would take probably months or or maybe even a year to launch something new. So that's how I kind of knew that there is an opportunity for me to be in that ecosystem and to try to beat all of those solid developers. I wasn't sure that I will be able to compete with high bigger companies backed up by VCs and so on. like a year or two years after doing Shopify apps, I realized that it's

3:16possible to compete with them as well. Okay, let's go a bit into your backstory here. What did you do before entrepreneurship and what got you into building stuff? Yeah, so right after finishing my school, I joined a local web design agency and I started working for $2 per hour. Since day one, I was always thinking, how can I 10x my earnings? And uh I quickly I realized that if I want to earn more I have to work like for myself. I I I have to start freelancing. So that's what I did in 2016 or 2015 I guess. 3 to 4 years later while I was still freelancing I

3:54was building products on the side. I had a client a startup who needed a landing page. So what I was doing I was just browsing the internet and looking for inspiration. And that's how I stumbled upon Shopify partners page. I bookmarked it and later on when I looked into it, I saw uh a section which said that top 25% Shopify app developers are making almost 300k a year. And in my eyes, it was like, oh my god, it's it's huge because what I was making with my freelance work was was much less. Having all of the experience in Shopify, I knew how how those apps were and that's how I

4:35realized that I have to build something myself in the ecosystem. Cool. Okay. The Shopify app opportunity. How did you find this idea? And generally, how do you think about finding ideas? When I was thinking of what do I want to build in the Shopify app marketplace, I I already had three main criteria. So, first one was it has to be pretty easy to build. I have to build it in like couple of months, no more than that. The

5:02second criteria was pretty broad market. I wanted to build something that could be useful for any Shopify store because it would be a lot easier to market it and I could use all of my clients that use Shopify and so on. The first criteria was I needed low competition. So that's my main my main setup how how I differentiate good ideas versus bad ideas. Nice. So on the topic of uh good ideas and bad ideas, let's talk about validation. How do you know when your idea is validated and what has that looked like for your apps before? Before building it, I tried to validate it with

5:41basically talking to users. You know, I joined various Discord communities of drop shippers. I joined e-commerce Facebook groups. I posted various Facebook posts in in those groups. And one of the posts where I I had a screenshot of my not yet published app. It was just a design and it kind of blew up. There was more than 100 likes and a lot of comments asking you know where can I don't download this app because they thought that it's already live. So that was my first validation that this product is needed and and yeah it it could be successful. If you can build a landing page or something to try get uh

6:22get the emails of your customers, that's great. If you can even charge for it, maybe make a pre-order or something, that's that's even better because you already know that people will pay money for it. All right, I got to stop you real quick and zoom out. Ericos built an insane business, 4 million a year on top of the Shopify app store without spending any money on ads. And that's maybe the secret, building on top of a marketplace. You don't need a big audience. You don't need to spend money on ads. And there's a built-in customer base just waiting for you to solve their problems. The only problem with that is

6:56that Shopify's developer ecosystem is, I'll admit, pretty mature. In other words, that means there's a good amount of competition on the platform. So, that begs the question, what's the next Shopify? What's the under the radar marketplace where I think developers should be building right now? Well, one place I think is interesting is the monday.com marketplace. We partnered with them on this video because they're putting real energy behind expanding the marketplace, investing in the platform, supporting developers, and actively looking for more builders to help meet their growing customer demand. Now is the time to get in early and make your mark while it's still easier to stand

7:35out. They've got over 245,000 customers across over 200 industries and 90% of their enterprise customers use monday.com apps. enterprise. That's the big bucks. What's also cool is they have good APIs, clean docs, solid SDKs, and a team dedicated to helping you grow and make money. If this tickles your fancy, well, with monday.com, we put together this free download breaking down a bunch of stats about the opportunity here, who their users are, and what kind of problems they really need solved. And here's a pro tip. take some of that info and plug it into your favorite LLM and I bet it will give you some really cool

8:15ideas for what to build. If you want to download, just click the first link in the description, fill out the quick form, and sign up for your developer account. It's all 100% free to get started. I'm stoked that we got to partner with monday.com in this video because Aeros is an example of what

8:31happens when you build on a marketplace. All right, let's get back to the interview. You're a designer, not a developer. How do you go about actually building these products? What's your process to go from zero to one with a new idea? Yeah. So, when I'm when I'm designing things, the first thing I look into is competitors. If there's already competitors in space, uh that's a good thing because you can dig into deeper and and see how they do like see their user experience. just go through it and I'm taking notes what I really like

9:04about it and what I dislike about it. And after that I I have a clear image of how my app could look like so that I could fairly say that it's objectively better than my competitors. And to make uh my chance for success higher, I have to find a co-founder. I think finding a co-founder is is pretty much similar to doing sales because you have to sell someone an idea that you can make a successful business and you just need their help. That's what I was trying to do. You know, I went into a local developer group in Facebook. I made a huge post. I and I mentioned that, you

9:45know, first of all, I have Shopify experience. Second, I'm a great designer with years of experience. So I can provide a great user experience which will increase our chance for success. Third, I have all of those clients already using Shopify which we can sell our Shopify app to. And with all of those things, you know, I think I'm increasing my chance for for finding a right fit. And and that's basically h how I found my co-founder. Let's go to the next section here. I want to talk about marketing. Uh, how do you go from Shopify app to real users and real paying customers? When you are just a

10:22new app, you have zero users, you have nothing. You're right at the bottom of the app store listings. So, I knew that we need to onboard as many users as we can manually. So, yeah, I just I just went to all of the communities. I just went to all of my clients, all of my friends that are using Shopify and asked them to install our app and try it for themselves. I made the app free and this way you can get more installs and of course more installs then convert to to more reviews and of course it drives more revenue then and it helps you know

10:57to improve your product further because you get all of this feedback. Okay, I want to dive into some of the dirty details about this reviews thing because I think that this is it's simple. It sounds simple, but it's actually genius. So, let's go a little bit deeper into the customer support and review strategy

11:16that really did change your business. Yeah. So, once we said that it's crucial for us to get those five-star reviews, we optimized all of our processes towards it. So first of all our product within our product you straight away we just ask

11:39for then we have all of these uh monthly emails. So every month we're sending a monthly email in which we uh show how much revenue this app brought to you and in that email we also ask for review. I think around 95% of our reviews for for our apps come from customer support. Our customer support is is topnotch. All of our customer support agents are really technical. So they can dig into your code and and fix things. And yeah, we

12:10provide 24/7 customer support right now. Nice. And now that you have a team, you realize still how important this is. And I realize that you have like a little bit of a system that where you gamified reviews. Can you talk more about that? So, recently I introduced a gamified bonus system to our customer support team and right now we're tracking who gets uh more reviews. We have the monthly leaderboard and uh we we have all of these different raffles and actually my favorite B bonus is uh a persuader of the month and what we do is we basically calculate the conversion rate of how many uh times you ask for a

12:50review and how many reviews you get and I think it really helps uh those agents bring more reviews and of course incentivizes them because they get bonuses for for each review. Cool. Okay. Okay. Well, let's dive a little bit into monetization, pricing, and conversion. How did you make the first dollar with cashing apps? And how did you get those first users? When we got our initial reviews, when we started ranking for for specific keywords, uh that's when we introduced our monetization, we introduced a subscription model. Uh later on, we introduced some tiers. So, like the more you use our product, the the the higher price you pay. Nice. And

13:32is there a kind of a strategy that you think about now? Every time you go to launch a new app, I always launch it for free because it reduces friction of installs and as soon as I start getting organic installs, I grandfather all of the users that already using uh our app so that they wouldn't need to pay and I monetize only the new users. And yeah, we always uh offer free trial. That that also helps. And we offer full refunds, no question asked because I think the risk of getting onestar review is is is just is just too big. That that was awesome. Uh next question is let's talk

14:11about tech stack. Uh what kind of tools or languages do you use to build and run this business? Yeah. So languages wise I I will not tell much because I'm I'm not technical but uh in our organization we primarily use Slack for for our communication. Then for our customer support we use intercom. Then we use uh features.vote for gathering feature uh suggestions. So every user can go to that board and suggest a feature or just upvote for other features that they think that we need to implement. Another tool that we're using is linear. Uh so we we use it internally for our task management. Last but not least, we use

14:50Mantle. You have everything Shopify related there. You you can set up affiliate partnerships. Uh you you can see all of the metrics uh all of the funnels uh customer management and so on. Since day one, our uh profitability was around 90%. expenses wise, we we always try to stay very very lean and and I hope we will stay lean in the

15:13future as well. Cool. That's amazing. Let's move on to the next question. More the lifestyle side of things. Can you give me what the day in the life looks like for you, a Shopify app developer making millions of dollars per year. Uh what does your typical day look like? Yeah, so I get up whenever I get up. I I don't set any alarms. Uh, I check my emails uh while still in bed. I I scroll some Twitter like probably everyone else in the world. When I have my to-do list, I always try to diff differentiate like quick wins, something that I can do in like up to 30 minutes. And all of the

15:50other stuff is is is the harder stuff that that I focus on later on. I I love the lifestyle. I I love what I do. And I don't feel like working. I I feel like I'm doing something. I'm really passionate about which which really helps because I'm you know I'm not counting time at all. That's awesome. Last question that we always ask uh all

16:10founders on the starter story channel. What advice would you give to someone looking to start their own business and start their own thing online? So I think that at start two people are are enough. You just have a designer who does all all of the product stuff. you have a tech guy and and you're good to go because you will be doing all of the customer support yourself to know that uh what your clients are struggling with. And yeah, once you start getting more tickets and once you start growing and and and scaling your product, then you can start hiring customer support and then you can start, you know,

16:47scaling scaling your team. And uh yeah, another ad- advice I I could give is probably to hang around other people that are building because uh you know community is is really is really helping because you you get to know people you can learn from their mistakes and uh yeah maybe you can even you know find a co-founder in those communities and and so on. That's it. Thank you uh Ericos for coming on the channel. Sharing your business that makes millions 90% profit margin is amazing and I can't wait to see you hit 10 million and take it further. So thanks for coming on. Thanks for having me. Ericos is the perfect

17:24example about how a designer and a builder can turn a simple idea into thousands of dollars. But that came with knowing the right information. For him it was about Shopify and finding the right problem to solve. Well, imagine there was a place that gave you this. Problems to solve, blueprints for building, and the marketing strategies that turn simple ideas into million-dollar online businesses. That's what we have at Starter Story, a library of over 4,000 case studies and business idea breakdowns where you can access this all data backed by real entrepreneurs. So, if you're serious about building a profitable side project like Aricos, head to the link in the

17:59description and we will give you 52 micro SASS ideas for free just like Aricos so you can get started on your journey. Much love and I'll see you in the next one. Peace.