Source: https://www.youtube.com/watch?v=_HiyjLNe_LA Channel: Starter Story Build Upload date: 20260404
If you want to sell your app for seven figures, here are the seven things you must do. This list was put together by someone who’s been on the other side of the deals. He’s acquired tens of millions of dollars worth of mobile apps and personally talked to close to 2,000 app builders across the last 5 years. And a lot of these builders you’ve probably also seen right here on this channel. I speak to about 10 founders a week. Everything from your beginner to the guy who just hit 10K MR. And I see a lot of guys making mistakes and not quite getting it right. His name is Josh. And what makes him uniquely qualified to give you this list right here is that he doesn’t build apps. He buys them for millions, which means he sees something most founders never get to see. What the other side of the table, the acquirers, actually care about. So, I asked Josh to come on to the channel and share these seven rules every app builder needs to follow if they want to build to sell and not just build for side income. All right, this one is important and let’s get into it. I’m Pat Walls. Welcome to Starter Story Build. All right, Josh, welcome to the channel. Tell me about your experience buying apps. >> For the last 5 years, I’ve been writing million-doll checks for a variety of different mobile businesses. In gaming, I had a budget of up to 150 million to buy mobile games. And now in consumer apps, I’ve deployed over 23 million into exceptional app founders. This means I speak to about 10 founders a week. Everything from your beginner to the guy who just hit 10K MR to the guy who already sold his business. So today I want to talk about the seven rules that end up separating the great founders from the good founders. That's why I'm really excited to have you on here. You talk to a lot of founders. You see apps that gets sold for millions and then you see apps that are making a bunch of money or not making a bunch of money and they never sell for anything. So that's why I'm really excited to have you on to share this. Anybody watching this can walk away with a few things that they can do today and over the next month and over the next year so that they can sell a business and have a lifechanging exit. So let's dive in. What's the first rule? >> Rule number one is value proposition beats category every time. Everyone always asks me when they starting to build their first app, they say, "What category should I build in to hit my first 5K in MR?" And the honest answer is it actually doesn't matter. You can make a ton of money with a PDF scanner app the same way you can make a ton of money with a step counter app. The truth is that your value proposition matters a lot more than the category you're building in. Your value proposition is the pain point you're solving for the user and it's the reason why you probably set out to build in the first place. So, how do you actually do this? The best tip I can give is to launch your app from day one with a premium tier. Don't wait until you have the perfect amount of downloads or you're waiting for product market fit. The question you want to answer as a founder in the beginning as soon as possible is do people see value in paying for my app. If the answer is no, you need to increase the value of your premium tier. Number two, you can lower the price. Or number three, you might have to pivot completely. One mistake I saw a founder make last month in a conversation was he hadn't played with his pricing. And this is something you should be testing cuz this has one of the biggest impacts on your revenue. >> Okay, what's the next rule? >> Go hand solo, guys. It's 2026 and if you're just starting and you're waiting for the perfect co-founder to come along and be your partner, stop. Because to go from zero to 10K or 50K or a million ARR, you don't need the best UI UX designer. You don't need the best product guy and you don't need the best codebase. All you need today is an app that solves a real problem and one proven distribution channel. This channel can be Reddit, can be Tik Tok, it can be Meta, can be Google, it doesn't matter. So, let's simplify all of this. If you're watching this and you're stuck, here's your co-founding team to build a consumer. First of all, screenesign.com to design it, Rock or Claude to build it, Tik Tok to market it, revenue to monetize it. For example, the other day I was talking to a cracked 22-year-old founder who built an app in the religion niche. This guy built the thing on rock. He used Tik Tok to go absolutely viral and the thing went crazy. The thing went parabolic. He was doing 2 millionaire raw within 6 months. And >> that's what I'm seeing too is that these AI tools lower the barrier to entry to get started. You don't need a designer. You don't need a back-end engineer. You don't need a front-end engineer. All you really need is a good idea in a good market as you shared. What's the next rule? >> Rule number three is you got to think beyond the MR because MR will pay your bills and that's super important especially in the early days. But for someone to come along and pay seven figures for your app, they need to understand what's behind the MR. And the answer to that question is the product metrics. How healthy is your consumer app? So, as an app founder, you've got to remember that if someone is going to pay seven figures for your app, it's because they believe they can build on the blocks that you've created. Let's simplify all of this because if you've just started out, you've probably got a few metrics that are coming in through your App Store Connect or your Revenue Cat and you're probably sat there thinking, "All right, these don't look great just yet. How do I fix them?" If retention is your problem, then build gamification. I'm talking streaks. I'm talking daily login rewards. I'm talking social features. That's how you fix that. If your problem is not enough people are buying your product, introduce some seasonal events, think about Halloween and Christmas with one-time offers and expand the number of prices you're selling at. Third one, if you're looking at your resubscriber rate and you're seeing people churn, I got some bad news for you. This one is kind of hard to fake and you just need to put in the work. You need to make sure that your product is actually solving a real problem and that the user feels that the price they paid is worth the value they gained from your app. I love everything that Josh is breaking down right now. How to build apps the right way, especially if you eventually want to sell. But here's the thing that he said that stuck with me. You don't need the best UI, the best code base, or even the best product. You just need an app that solves a problem, and has one proven distribution channel. So, if you're watching this and thinking, "Okay, I'm ready to build something." Well, I have just the thing for you. We created a free boot camp where you will build and ship your first iOS app in just a few days. We will walk you from idea to a real live app on the app store. And the best part, you don't need any previous experience to get started right now. Josh said it himself. Stop waiting and start building. So, if you're ready, just head to the link in the description and start building your first app for free. All right, let's get back to the episode. Rule number four is keep a clean house. Because when a buyer comes and they're going to write a check for 7 8 figures, they expect to receive clean, clear, and organized documentation about your business. And this can include the technicals. This can include your financial performance and your product roadmap. And this is so so important because the buyer is about to take responsibility for your baby, the thing you spent years building. But it means the buck now stops with the buyer. The risk is on the buyer. So don't panic if you don't have all of this now. Luckily, it's pretty easy to fix. And let me tell you how. If you're just starting, document everything. Keep a P&L, which is a profit and loss. Keep track of your tools and infrastructure in a Google doc and keep track of where you're spending your marketing money. Now, if you're already doing a few thousand per month, again, don't stress. Take one morning, go backwards, build a P&L to the best of your ability. It doesn't matter if it's not perfect. The most important thing is to be honest and upfront about that. It's not going to kill the deal, but if you start accurately tracking things now, you're going to thank me later. I recently sold my business and one thing that I wish I did a little bit more of is just yeah more standardized tools to manage certain things like working with contractors, working with payroll, taxes and things like that. So I think that's really important not to reinvent the wheel. I know there's a temptation to vibe code anything that you would potentially spend money on right now, but if you want to sell your business, I wouldn't be vibe coding tools. I'd be using industry standard tools that a buyer is comfortable owning that risk after the deal goes through. So that's a great one. What's the next rule? >> Rule number five, I call marketing miles per gallon. Imagine this. Your app is a car and the distance your car travels is your revenue. Gasoline is your marketing dollars and you want your car to be able to drive as many miles per gallon as possible. I.e. you want to create the most revenue with the least amount of marketing dollars. Why is this important? Well, let me ask you this. If you're doing 5K MR, but you're investing 5K into marketing per month, is that a good business? So try and track your marketing spend and identify the channels that are performing best for you. When you find the channel that works best for you, double down. Like I said before, you just need one that works really well, especially for the early days. So I just bought an app in the education category. And the one thing I really liked about it that dictated the seven figure outcome was the fact that every time he spent his marketing dollars, he returned that money within 7 days. Now that's top tier. A good benchmark for you guys listening out there who are just getting started. Anything sub 60 days in the early days is really, really good. Rule number six is build the relationships early. I've signed multiple seven and eight figure deals, and honestly, the common denominator that gets the deal over the line every single time is relationship. From my perspective as a buyer, would I rather write a check for8 million to a founder I’ve been talking to for 9 months who shared with me their highs, their lows, and kept me updated, or would I rather write a check to someone I met last week? Here’s what I’d recommend. Find a few mobile app buyers and send them this exact message. In fact, take a screenshot of what I’m about to show you. Hey Josh, I’ve been building this app for X months. We’ve grown Y% month over month, but not without some challenges. Right now, I’m having a lot of fun growing it, but I know someday I’ll sell it. I’d love to connect to build a relationship for when that time comes. Copy and paste that message to any app buyer you can find, and you’ll be in good hands. We shared this on the starter story acquisition of HubSpot, but it all started with a sponsorship. They were advertising on our channel and they were one of our biggest partners. They enjoyed working with us, we enjoyed working with them, and it didn’t happen overnight. That relationship was cultivated over the course of years pretty much. So, similar to what you said is just start relationships generally. Talk to people, not necessarily just your customers, but buyers like you or other builders, even competitors. Build these relationships and amazing things will happen. So what’s the next rule? >> The last rule is nobody’s perfect. Every business has a sewer. And this is the name I give to those parts of your business that you kind of want to hide. For an app, it might be bad retention. It might be high churn rates or a nasty co-founder. What I’m trying to say is it’s okay. Like no one expects a perfect business. What I want to stress though is that any buyer who’s going to write a check for your business is going to find these sewers during due diligence in a sale. So honestly, the best piece of advice I can give is to be upfront about the imperfections. It only helps to build the trust, and these imperfections are going to come out in due diligence anyway. At the end of last year, I was deep in due diligence with an app that I absolutely loved. We were about 2 weeks out from signing before the founder asked to jump on a call. On the call, he looked a bit downcast and he basically explained that his relationship with his co-founder was kind of messy and it was going to be kind of difficult to get the deal over the line because of this problem. Now, the fact that he raised this to us and we could work through it together means we actually got the deal over the line instead of something like that blowing the deal up at the end. >> So true. I talk to a lot of founders, obviously that’s what we do here at Starter Story, and I go and talk to a lot of people that built cool stuff. And then usually isn’t said on camera, but sometimes there’s a conversation that goes along like, “Hey, I worked with this guy when we just started out and he believes that he has 50% equity of the business, even though I built everything.” And then there’s this whole legal battle going behind the scenes. If there is an extra rule that I would like to give to founders is that be very careful with giving out equity in your business and co-founder relationships and building a business with someone that you truly trust and have those conversations early. I believe that one’s really important too. So my last question for you is for anyone watching this that is in the process of building something right now. They’re about to build something or maybe they’re making a little bit of money. What would be like the top three tips of things you can do right now to maximize your chances to selling for millions? >> Okay, let’s do a quick fire for this one. Number one, and the product guys are going to kill me for this, you don’t need an original idea. Copy 90% of an app that works. Add 10%, you know, sprinkle in your own innovation. Off you go. Number two, guys, monetize from day one. Prove to yourself that the thing you’re building, people are willing to pay for. It’s so, so important. Otherwise, you’ll find yourself months, years in with no paying customers. And finally, you only need one marketing channel to work. You don’t need to nail Reddit, Tik Tok, Meta, Google, blah blah blah. You don’t need it, especially in the early days. Find one thing, make it work, double down. >> Before this, we just shot with another founder. He had a million-doll app, which was purely Android, purely Google ads. One channel, that’s it. That’s all you need to build a business that changes your life. Thank you for coming on the channel, Josh, and sharing this. I hope to have you back on to talk more about how to sell your business. It’s a very current event over here at Starter Story, so it’s awesome. And thank you for coming on, >> dude. Thank you so much for having me. It’s been great.