How to Build an App That Generates Passive Income
Mobile app revenues are expected to hit roughly 190 billion this year. At this point, if someone says, “There’s an app for that,” they’re probably right. App development could be the key for many aspiring digital nomads to escape their 9 to 5 routine and achieve financial freedom.
The perks of becoming an appreneur (an entrepreneur in the app space) are:
Extremely high demand
It’s difficult to do, so there’s more barrier to entry than someone trying to become a YouTuber
Apps can scale if designed properly
Low maintenance after App Store approval (especially for simple apps)
But perhaps the best perk of all is this — you don’t have to know how to code to develop an app. You just need an idea.
You might wonder, “Well, if there’s an app for everything, where do I start?”
The truth is, maybe you do have an idea already that could be the next Facebook, Instagram, Snapchat, or that rare concept that everyone has overlooked...but in case you don’t, there’s still a way into app world for you…
Yes, a non-coder without a highly original idea can make an app that generates passive income. I know because I was and am that guy. I’m not here to talk about theories. I’m here to tell you what I did as a non-coder to create a passive income stream and hopefully inspire you to do something even better.
I’m a writer by trade. I’ve been blessed to turn a hobby into a living. How that connects to the app world is that I was looking for ways to promote my writing on Instagram a few years ago. I stumbled across a number of big poetry accounts and noticed a huge trend that nearly all of them shared — each of them typed their poetry out on vintage typewriters.
To confirm that this perceived trend was indeed a pattern, I searched Instagram for #typewriter and found that there were roughly 1.6 million mentions. This told me that there was a market demand for something in this space, so I wondered if there were currently apps that served the typewriter function. Mind you, the demand for typewriters, stems from the aesthetic of the fonts with their unevenness and imperfections — not for any sort of functionality.
I immediately went to the Apple App Store and searched for typewriter apps. There were two notable apps that really fit the bill — Hanx Writer and The Amazing Type-Writer, but neither of them were optimized for the Instagram craze.
Hanx Writer was conceived by Tom Hanks, who is a typewriter enthusiast, so it focused on the manual feel of the keyboard itself and was limited by in-app purchases and page layout issues.
The Amazing Type-Writer only included one font and had no way to erase mistakes. So instead of trying to reinvent the wheel, I looked at what was already out there and came up with a plan for how to do it better.
That’s how the My Typewriter app was born. First, users would have multiple options for vintage typewriter fonts (11 total along with a font randomizer). The user would be able to delete mistakes, hear the clinking of a vintage typewriter as they pressed the keyboard, and ultimately, be able to upload their poem or piece of writing directly to all social media platforms or save it to their phone (the “paper” matches Instagram’s dimensions).
I knew this concept could fill a gap in this niche market. There was just one problem — I couldn’t code. The good news is, you don’t have to be able to code to be an app developer.
I did my research and found multiple app development companies with solid reviews. From poor past experiences working with overseas developers, it was important to me that the firm was local, so we could have some face-to-face meetings and develop some level of rapport.
You may do just fine to work with developers overseas. Personally, that’s something I avoid nowadays simply because you have to know how to properly manage the process if you do go that route. The other expectation is that foreign labor will be cheaper, but if it’s done incorrectly, often times (and as I learned the hard way working on StudyHubb) you’ve paid for a broken product in the end.
Anyways, because the app is a fairly simple concept without servers or anything extraneous involved, from conception to being App Store ready, it only took about a month to bring My Typewriter to market.
I knew there was a built-in audience on Instagram, so I started off reaching out to all of the influencers in the writing and poetry markets to promote the app. Many of them agreed, loved it, and continue to use it to this day, so their followings are continually exposed to My Typewriter.
For your app to continue to make you money over time, you need to rank highly in the App Store. Do your market research and do a quick search on App Store Optimization (ASO). It will pay off for the same reasons companies are willing to pay a small fortune for page one Google results.
Okay, so here’s the deal: My Typewriter has generated about $5,000 per year in its first two years of existence for a total of over $10,000 so far.
I do zero paid promotion and spend zero time marketing it at this point, but the app shows no signs of slowing down. I pay no money for servers. I do spend $100 per year on maintenance and $99 for my Apple Developer account.
So let’s review why My Typewriter work so well, how can you build an app that generates passive income, and what you might avoid doing:
Find a low competition niche. Could you see your app reaching the top 3-5 results without having to spend a big amount on ads and other marketing plays to get there?
Add features that outdo the competition. One of the easiest ways to do this is to look at App Store reviews users have left your competitors and add or fix those features on your app.
Have cheap or free marketing tactics ready to go. You can build the best product in the world, but if you have no plan for marketing it, your work will be for naught. I knew Instagram would be a goldmine if I employed an influencer strategy.
Keep your app simple (at least for version one). As a non-coder, there’s a cost for every feature you want to add, so make sure that you start off with the essential features first. Then, if your audience is clamoring for something else, add it on. You could even consider making it an in-app purchase...which brings me to the next point.
Be smart with your revenue model. I based mine off of The Amazing Typewriter, which was priced at $1.99. I figured if I priced mine the same, but offered something significantly better, it would organically take over their place on the app charts — a theory that was correct. However, consider the type of app you’re developing as you decide on your revenue model. For instance, people aren’t generally accustomed to paying for adds on social media apps, so you may expect to go for ads there. If you have a utility app that occupies a specific, proven need (like a typewriter, or an app related to a profession like a measuring app for insurance adjusters), then you can likely get away with charging an upfront fee or a recurring fee.
Consider avoiding for Google Play until your app has proven demand. Google Play is a separate market and type of user than Apple. What this means is that your app could be crushing it on iOS, but may see little traction on Google Play and be received drastically different. While none of this advice is a blanket statement, my experience has been that despite offering Google Play users the same exact app, they don’t enjoy it as much (it looks, performs, and feels the same as the iOS version) and tend to be more critical. On iOS, My Typewriter has 4.2 stars, whereas Google Play is somewhere in the two range last I checked and I make very little money from Google Play. I would still eventually launch it there as well, but for beginners I would generally recommend waiting until you have 5x’d your initial investment for Apple development.
Lastly, rinse and repeat. If you can create 10 things like My Typewriter, you’re making $50,000 of passive income per year. That’s a full-time salary in many professions and perhaps the start of becoming a smartphone app mogul.
