Why Did I Invest In A Free App?
I’m not a charity, money don’t come easy (as the song says) and apparently the kids have to be fed, so why did I invest in a free app? It’s a good question. The answer, of course, is not simple. Well, actually it is quite simple, but I’ve been told that I have a thousand words to fill, so before I get to “why a free app”, let me explain “why Haystack”.
My Haystack journey began with a catch up for coffee with my friend Brian. Each of us had recently left good jobs with good employers to pursue our own ventures, so it was natural that we should catch up and trade stories. We also hadn’t seen each other for a while, so there was a lot of football to be discussed and general rubbish to be talked. What I didn’t expect was to leave that catch up having agreed to be a lifetime sponsor of a charity that Brian’s family had founded, be an almost investor in Haystack and having paid for the coffee; and I think he may also have had a donut or two.
I say an almost investor because Brian’s initial pitch was less than convincing. He explained a little about Haystack, offered no due diligence and told me that only around one in ten of these type of ventures succeeded. All I really had to go on was Brian’s obvious excitement (but then again Brian gets excited waiting for his eggs to boil) and his offer to arrange a meeting with the Haystack CEO, Ran. Ran and his two brothers had created the Haystack concept and had spent the previous two years developing it, and he was a good friend of Brian’s, so a meeting was arranged and I went home to iron a shirt and polish my shoes.
A few weeks later I met with Brian, Ran and two other potential investors. I knew both potential investors through Brian, and had enjoyed a beer or two with them in the past. They were successful in their own fields but had a bit of humility about them, each had a sense of humour and, most importantly, a positive attitude. The only person in the room I didn’t know was Ran. My decision to invest would come down to my perception of Ran as a person and the presentation he was about to give. He didn’t disappoint. By the end of the presentation and follow up question and answer session I knew I was going to invest. I took an instant liking to Ran as a person and I was convinced he and the others at the table were the type of people who’d bring solutions rather than problems to any venture. I was confident that when disagreements surfaced, as is inevitable with any new venture, the personalities around the table would be able work these through, banish ego and, once a decision was reached, all pull in the same direction; and we all had skills and experience that could help Haystack succeed. On top of all this good feeling, Ran’s presentation had impressed.
Ran’s presentation was professional, covering the journey that he and his brothers had been on to date, analysing their successes and set-backs, and setting out their vision for Haystack and its future development. He detailed the development plan, the app would be continuously improved, the marketing plan, the competition, the timetable through to launch, the likely hurdles and how these could be overcome, how much he was seeking from the new investors, how this money would be spent, future investment requirements and how and where this would be raised, the experiences of other tech start-ups, the failures as well as the successes, and to get back to the point, the revenue model.
Yes, ladies and gentleman, Haystack is a free app but one with a revenue model, and importantly, a revenue model that does not involve selling or giving away the data collected to a third party or flooding the app with annoying advertising. Ran’s view was simple, we had to earn and keep the trust of Haystack’s users and to do so meant that their information would never be sold or disclosed by Haystack. All investors agreed with this proposition and it was fundamental to my decision to invest; better still the revenue model itself can only succeed if this trust is earned and retained.
So what is the revenue model? As I said about 800 words or so ago, it’s pretty simple: Haystack will always offer a quality free version of the app, but additional premium services will be available soon and a corporate version is being developed. To be able to earn fees from the premium and corporate versions it will be essential to keep the trust of our users by ensuring that their information is never sold or disclosed.
So, a year after my decision to invest, where is Haystack? How far have we come? Well, we launched in Australia; then launched in the UK, the USA and Canada; we’ve recruited a small and dedicated team of young graduates from Queensland University of Technology (QUT); moved from our initial office in an ice cream factory to the Coterie Creative Space on the QUT campus at Kelvin Grove; and have people from some of the biggest organisations in the world using the Haystack app, with our user base now growing on average at around 10% a week. Yes, a week! Haystack is continually being improved, while development of the premium and corporate versions is well advanced. We are still in the game, with a growing chance of being that one in ten.
So, if you haven’t done so, download the app and have a play with it. If you’re using it, thanks for helping Haystack on its journey. Lastly, get onto the Apple store or the Google playstore and write a review. We think the app is superb, but that’s not the point – it’s what you think that counts.