It often happens that a team with a potentially strong project for mobile platforms has good metrics and prospects, but there is no money for traffic. There are several ways to get them – Aprenita told us more about one of them.
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Mobile projects don’t pay off quickly. Even after a successful launch, funds are required for development, especially in conditions of constantly rising traffic prices. It is also important to take into account that money from users does not appear immediately on the developer’s account – it can take up to six months for the platform to transfer funds honestly earned by the developer.
Therefore, even relatively successful teams often have to look for additional sources of funding, especially if they want to scale their business. It is good when business angels appear on the horizon: private investors or representatives of funds who will understand, believe and help. But angels are picky — investments receive, on average, from 1 to 5% of all projects, and solutions are not implemented immediately. Plus, the angelic “blessing” is not disinterested: the investor’s interest in most cases means a share in your business.
If the “angelic” services are unavailable or unsuitable, the developer can apply to the bank for a loan. At first glance, this option seems easier than finding an investment. However, the banking environment is conservative. This system was created for traditional business models. Substantiating the potential profitability of a mobile project for an auditor based on the unloading of mobile analytics is not a task for the faint of heart.
The founders of the Aprenita project, a credit organization created specifically for mobile developers, thought about whether there are alternatives.
Aprenita and her idea
The company was founded in New York by Mark Loranger and Sergey Kovalenko.
Their idea was to take into account the advantages of the two interaction models described above. That is, on the one hand, to be a bank without paperwork, and on the other, to give money only after evaluating the success of projects.
Plus, at the same time, it was fundamentally important not to require collateral and personal surety; not to hold long negotiations, pitches and presentations and not to conclude “agreements of intent”. In general, automate everything.
So they came to create a service whose main service is the provision of fast targeted loans for application developers, a service that, in its manner of operation, more resembles an analytical platform. That is, to get a loan, you need to submit an application, link your account to the service in one or another analytics and, in fact, that’s it. If the loan is approved, the developer receives an offer two days later.
According to the founders of the project, fast and convenient lending is the incentive for development that the mobile industry currently lacks: “Even a successful developer faces obstacles that slow him down – the duration of the return on investment, unforeseen expenses… If we consider money as fuel for business, then Aprenita is a mobile gas station: refueled and confidently went ahead in fifth gear.”
In addition, the company is engaged in “factoring” — i.e. acts as a financial intermediary between the market and the developer. The fact is that the interval between the transaction from the user and the receipt of real revenue to the account can be up to six months. Aprenita helps to speed up the process and make a profit in 2-3 days after the close of the week.
Now the service is designed for applications that profit from users: through internal purchases, subscriptions or paid installations. However, in the near future it is planned to cover those products that are monetized due to traffic — i.e., the display of advertising. To do this, the company is already establishing cooperation with major advertising networks.
To date, Aprenita supports Flurry, Google Mobile, Localytics and Tapjoy.
How does Aprenita evaluate projects?
Of course, every credit institution, before giving money to a business, evaluates its financial potential. But in the case of Aprenita, extracts from tax authorities or accounting statements are not needed. Credit history is also irrelevant. Instead, data from application analytics is taken into account. There is a complex mathematical model behind the decision-making. The system takes into account the indicators of MAU, DAU, ratings, the number of real installations, reviews and, of course, revenue for the last period. Based on the collected information, a forecast is made and the optimal loan offer is calculated.
It is this format of work that the creators consider the most suitable for such a dynamic industry as mobile: “The mobile industry is young, peculiar, and the market is not yet prepared for it: there are not enough suitable tools, including financial ones. Aprenita was created to solve such problems. We want to create a new generation of mobile banking, to become a universal platform for the acceleration of mobile projects.”
Working with Aprenita, a developer can receive a loan offer within two days. At the same time, everything happens online, so if you and your studio prefer to work in Goa or in any other sunny corner of the planet, this is not a problem.
About the pitfalls
Are there any pitfalls here? Well, if you have just launched a mobile application, sincerely believe in its potential, but have not yet demonstrated good metrics, perhaps Aprenita will not suit you.
According to the founders of the project, “the target audience of the project is medium—sized businesses: applications that have already proven their viability and need some momentum for further development. On the other hand, there are no unambiguous situations. After all, the line between a startup and a working business can be very thin.”
To date, venture capital investments remain the main source of financing for mobile applications. It is worth paying tribute to the “business angels” – they managed to launch a lot of worthy projects into the big flight. However, a successful launch is not enough — you need to constantly solve problems in “open space”, and these tasks require a different approach. Of course, the appearance of new financial instruments and new development impulses on the market is a plus. After all, as we know, a multi-stage rocket can reach a higher speed than each of the stages individually.
“Aprenita does not compete with venture funds. — Sergey noted. — We have our own niche. In a sense, we are only treading the path and understand that a new product always causes discussion. We are ready and want to receive feedback to get better. If App2Top readers have any questions, I am ready to answer them (just below in the comments, or via fb/ by mail).”