| Readwise URL | https://read.readwise.io/read/01kt2ktpp9spdzwvm8t4bs80hk |
|---|---|
| Readwise ID | 01kt2ktpp9spdzwvm8t4bs80hk |
| Date | 2024-12-29 |
| Author | youtube.com |
| Category | video |
\n\nSource: https://www.youtube.com/watch?v=5u9u8yzPEpA
I taught myself to code with ChatGPT,and my apps have made over 10million with three iPhone apps afterlearning how to code less than two yearsago? Well, two letters: AI. Now, with theadvent of ChatGPT and thepopularization of AI, there are so manydifferent problems that you can solve,either in different ways or at a decreasedcost in order to solve it. I spent overan hour talking to Blake to figure outthe truth behind how we actually builtthese million-dollar AI apps and howother builders can take advantage of the
same opportunity. He shares it all,including his process for findingmillion-dollar AI ideas and validatingthem, his blueprint for building an appfrom scratch as a complete beginner, andthe marketing strategy that is makinghim millions. TikTok and Instagram arevery solvable right now. You can figureout the various influencer strategies tofunnel millions of people to yourproduct. Now let’s get into the details.I’m Pat Walls, and this is Starter.[Music]Story. Welcome, man! It’s nice to have you.
Tell us about who you are and what youBuilt, yeah, absolutely. My name is BlakeAnderson. In one year, I taught myself howto code with AI. The first app that Ibuilt was called Riz GPT. It’s at 2 and 2million in annual revenue. The second appthat I built was called Umax. Once again,I came up with the idea, designed, and builtthe application and led the majority ofthe marketing. In the past year, we’vedone almost $5 million in revenue. Then,the third app that I co-founded wascalled CI. This one I also came up withthe idea for, though I did not build theactual application. I helped with thedesigns, but I have two amazingco-founders that lead operations on that.
CI was launched about 6 months agoand is now doing over a million dollarsin revenue per month. Okay, so you builtnot one, but three successful AI appsthat are doing almost $20 million peryear. Tell me about this opportunity inapps right now. Okay, this is a greatquestion. There are two primary reasonsthat apps are so lucrative right now. Thefirst is the advent of Chat GPT and thepopularization of AI. There are so manydifferent problems that you can solveeither in different ways or at adecreased cost in order to solve it.
With Riz GPT, it would have beenvirtually impossible to build an AIdating assistant without the use of LLMs.Number two is novel distributiontechniques. TikTok and Instagram arevery solvable right now; you can figureout the various influencer strategies,the user-generated content strategies,and organic account growth strategies tofunnel millions of people to yourproducts. I don’t think that thealgorithms were as optimized for newaccounts to be able to generatemillions of views a few years ago, butnow that they’re all in a bloodbathcompetition with one another, they have
to incentivize new creators, and sothey’ll push more views to new accountsthan they did previously. All right, soessentially, apps have become way easierto build and market recently, which iswhy they’re a great business to startfor anyone that’s watching this rightnow. But let’s go back; I want you toactually share the story of how you gotstarted with this whole thing. I’vealways been fascinated byentrepreneurship; I’ve always hustled throughoutchildhood, figuring out new ways to makemoney—mowing lawns, raking leaves.
Shoveling drive waves then in highschool, I was still hustling. I builtan Ethereum mining machine back in 2016or 2017, scaled Instagram meme pages. Butto be honest, I drank way too muchalcohol, did too many drugs, really justprioritized partying and living arelatively degenerate lifestyle. Aftercollege, so senior year, I’m graduating.All of my friends have great jobs in NewYork City making six figures, and I hadnothing. You know, I had moved back home.Family isn’t doing well financially; thehouse is going up on the market. My olderbrother is giving me loans for groceries.I was like, “Okay, I got to figuresomething out.” I do not want to get afull-time job, and I set a goal formyself. Right as I graduated college, Iwas like, "Over the course of the next 12months, I will figure out a way to make50,000 over thenext year. I suppose this is where yourfirst app, Riz GBT, comes into play, right?
How do you get started with it? Yeah, wehad friends that would send inFraternity group chats, or whatever groupchats with guys, saying, “What shouldI say to this girl?” We figured thatwe could build an app to help peoplerespond to girls. I taught myself to codewith ChatGPT in the month of Mayand June 2023, and then we launched in Julyof 2023. The first version of the app wasso bad. I built this myself; we didn’thave notifications, we didn’t havereviews. The design was a mess, the paywall was terrible, and the first fewpromos went out, but it didn’t really doanything. A few downloads; we were making afew bucks. Then, I found these twounderground, kind of undiscoveredcreators. I paid them each 100 total, and overnight, 5 to 10 millionviews total, 45,000 downloads in thatfirst big day, 200,000 downloads on thatweek, 500,000 downloads in the month.
We were at 80k MRR from the jump; that’spretty much all profit. We ended upscaling it to a little bit over 250k MRR,and then it kind of dropped down andplateaued to like 150 to 200k MRRconsistently, and that’s where it’s at.Now, Blake is proof that you don’t needthe perfect app or website to startmaking thousands of dollars off an idea.
All you need is an MVP and a smartmarketing strategy, but you also need tomake sure that you’re working on a solididea. That’s why I created the StarterStory Academy, a place that helps youfind an idea, validate the idea with realfeedback, and shows you how to execute onthat idea so you can get those firstusers. So, if you’re curious aboutbuilding a software product like Blakeand hundreds of other founders just likehim, head to the first link in thedescription to check out the academy now.
Back to the video. All right, Blake, yourstory is insane! Mobile apps totallychange your life. Yeah, now let’s talkabout how our viewers could do somethingsimilar. Everything starts with an idea.Right? What do you think are some of themobile app ideas that could be turnedinto millions of dollars right now? Yeah,number one, I think that there are a lotof fragmented tools. It’s like AILinkedIn image generator or AIresume analysis, but I think that there’smassive opportunity to build a career AIstyle platform where you roll up allthese tools into one platform and brandit as, if you’re a student and youwant to get a job, this is the platform.
To help you do so, you could buildthat in a mobile app as well as a webapp. Next up, language learning: the ChatGBT advanced voice mode. It’s prettyincredible! It’s like actually a personaltutor. Duolingo is making 400 million per year. You capture1% of that market and you have a $4million annual application on your hands.
That’s crazy! Honestly, to me it seemslike you’re the type of person thatnever runs out of ideas, no matter howmany things you build. So, let’s talkabout that. What are your methods forfinding winning ideas? I’ve used honestlydifferent methods of finding the ideafor each app that I’ve worked on. WithRiz GPT, it was a very clear problem that Ihad observed with people that I know:people don’t know what to say on datingapps! And you build an app to solve it.
Umax, on the other hand, was identified alittle bit more opportunistically. Whenpeople want to become more attractive,they’re willing to spend money on it.They were spending money on skin care,hair care, Gua Sha, the whole nine yards.But there didn’t exist any software tosolve the problem that people wereHaving found a niche that’sheavily monetized with physical products,that’s a good indicator that the nicheconverts. It’s also a good indicator thatyou can probably build a software orapplication to solve a problem within it.
I think that there’s still a lot of roomfor an all-in-one AI glow-up application.Umax was kind of like the firstiteration, but if someone were to putreal-time investment into building asuper valuable application thatreally helps people improve, I think thatthere are still millions and millionson the table. All right, man, thankyou for sharing that. Now that we havenot only the exact ideas that could bebuilt right now, but also your methodsfor coming up with more winning ideas, doyou have a specific process forvalidating these ideas? My validationprocess primarily looks like a deep diveinto the niche on social media. Sowhat I’ll do is I’ll create an accountsay, Cal, and then purely consumenutrition, dieting, and caloriecounting, weightlifting content,essentially becoming the target marketor target demographic, and then thinkingabout what it is that I want.
Just build that, okay, gotcha. Puttingyourself in your customers’ shoes is howyou know they’ll buy. Now let’s talkabout actually building the app. What’samazing to me is how you’re able tolearn design, coding, and distribution insuch a short amount of time and makemillions with those skills. If you wereto restart from scratch today, havingnothing but the idea in mind, how wouldyou build it? If I were to restart andbuild apps today, here are the tools thatI would use. Number one for design, Figma.Learning how to use Figma will be one ofthe greatest unlocks in ensuring thatthe application that you put into themarket is actually us.
Now, what I would recommend for anybodydesigning to do is to use references. I’mgrabbing different apps that havesimilar functionality and design to whatI’m looking to build and then using thatto inform my design process.Right? Even if you yourself don’t intendto be a designer, you need to be able towork in Figma to work with designers,whether you hire them off Upwork or workwith someone internally. Number two, whenit comes to building, what I wouldrecommend is that you build in React.
Native with the EXP Expo framework, usingCursor as your IDE. Then finally, when itcomes to marketing, the two primarymethods that I would recommend areinfluencer marketing and doing internalUGC. So influencer marketing is when youfind somebody that already has aplatform or an audience, and you pay themto promote your product. Internal UGC iswhere you, or someone that you hire,creates content based around yourapplication and then posts that toaccounts branded around your application.And if you are creating content yourself,in the early days, you’re going to wantto use CapCut to do so. You can do acombination of slideshows and facelessvideo content, or content where you’respeaking directly to the camera. The mostimportant note here when it comes to
marketing is constant iteration. Beruthless about how you iterate; try outdifferent strategies, and as soon as youfind something that is able to produceprofitable returns for the company basedon the time and/or money investment, youdouble down, and double down, and doubledown on that. I want to double click intomarketing because I see a lot offounders struggling to get eyeballs onTheir products—what are the mistakesthat you see people making most when itcomes to figuring out marketing? Yeah, Ithink that where a lot of people getlost in marketing is they think, “Okay, Iwill just DM influencers and expect aresponse within 24 hours.” They’ll DM 10influencers, and they get no responses.
They go, “Oh, this is so hard,” and I’m like,“No, you’re just not gettingcreative with it.” Riz GPT, the Creator,is making the most profitable content.Most of them were like 18, 19 years old;they’re just doing it for fun. And so,getting in contact with him was reallydifficult. I would find that one of themhad a Discord link hidden in theirInstagram bio or something, and I wouldjoin that Discord. I would send amessage every 10 minutes until theperson responded. There were guys that Iwas DMing their mom saying, “Hey, get me acontact with your son. I want to pay himmoney.” Alright, now let’s talk about howto make money. Once you have those, itballs, how should people watching thisright now actually monetize their app?
The primary monetization model for mostapps is subscription. Everybody that Iknow that makes a lot of money on apps,When I use subscriptions, generally I try to gowith lower price points for a couple ofreasons. One, I want as many people aspossible to be able to use myapplications. People are more likely totell their friends about it and getgenerally more positive user sentimenton social media. But then it also is moresustainable for long-term growth. Youknow a lot of apps charge significantlyhigher price points, which leads me tothe most important point: youshould use Super Wall. Super Wall enablesyou to split test different offerings, such asdifferent price points, whether it’sweekly, yearly, or monthly, at differentpoints in the app. Being able to testthese different offerings and differentplacements within the app can take youfrom making X per user that downloads to1.5 or 2X.
Awesome. Okay, so far we’ve only talkedabout the positives of building apps, butsurely there are some pitfalls, right?What are the main expenses you have ofrunning AI mobile apps and how canpeople minimize them to stay profitable?Yeah, so Apple charges 15%, but forwhatever reason, it’s really closer to20% of revenue up to your first million.
Dollar in earnings beyond that, Applecharges 30%, but really close to like 33%.One thing that people significantlyoverestimate is the cost of AI inthe back end. Unless you’re doing imagegeneration or using advanced voice mode,AI costs are sub 3%. The bulk of theexpenses are usually attributable tomarketing and staff. If you’re doing thatcontent creation yourself, you can do iton your own. But one of the reasons thatinternal UGC is great is that youusually see somewhere around 50 to80% profit margins.
People doing influencer marketing usually seesomewhere in the range of 25 to 70%,and then people doing paid ads generally seelike 0 to 30%. So in-houseorganic content might be the way to goif you don’t want to spend all yourprofits on marketing.
On that same topic, are you comfortable sharing yourprofit margins? So after influencermarketing, after Apple’s cut, after serverprocessing, that sort of thing, Riz GPT, Idon’t think I can talk aboutunfortunately because it’s run by my otherco-founders. Umax does a little bit over$100,000 profit a month consistently.
Used to do more. K, I does a few.
Hundred thousand in profit a month. Okay,another sensitive question, sorry aboutit, but I’m just curious: what made youleave the Riz GPT team? I left because oneof my co-founders and I were constantlygoing head-to-head about who’s atthe helm of the company. Essentially, whatI said to him was, “Okay, we can’twork together anymore. Either you run thecompany and I keep my equity, or I runthe company and you keep your equity.” Hewanted to continue running it, which Iwas like, "Great, I’m going to go work onnew projects."All right, thanks for being transparentabout that. Now I’m going to go a biteasier on you. Let’s talk abouttechnology. What’s the tech stack?
Honestly, my stack looks like Figma,Cursor, CapCut, and Mercury for banking.That’s actually pretty big. Mercury isthe best platform for startup banking inthe US. Upwork for occasional contractedwork. One Upwork method I would recommendfor anyone considering hiring off ofthere is to hire like five to 10 guys to do anhour or two of work, and then stick withthe best guy. That tends to work verywell. Coding languages: React Native andNode.js. Yeah, pretty straightforward.
Nothing special. All right, man, let’s talkabout some personal stuff. What are youup to these days? I’ve always been sopassionate about self-improvement, aboutdoing everything one can in order toimprove their health, to become moresuccessful, and find more purpose intheir life. And so, that’s why I set offto build what I’m currently working on,which is Apex, which I describe as anall-in-one self-improvement ecosystemwhere we’re starting to create content,build a free community, build free mobileapps to help people, and sell low-marginhigh-quality physical products. It’ssomething that I’m very excited for andpassionate about, and I wake up everymorning just so amped to work on it.It’s going well; we started this a littlebit over a month and a half ago. Hell,yeah, man, that’s exciting. I think it’sawesome to wake up every dayand work on something that you’reactually passionate about.
Another question I want to ask you is: What’s thebiggest lesson that you’ve learned inyour entire journey? Arguably, the biggestone is creating a sense of urgency. Ifound that my most productive andsuccessful periods have come whenThere’s a lot of risk and a lot of urgency to get done quickly. So whenI was building Riz GPT, it was like I wasat home making zero while my parents’ houseis on the market. Meanwhile, all of myfriends are making these great six-figuresalaries, living the life aftercollege, and I felt like I had a fireunder my ass to get something done andto begin succeeding. When I was buildingUMX, I had obviously just split from myprevious team and I felt like I hadsomething to prove. I was on my brother’s
couch, I spent Thanksgiving alone, I hadsome sliced turkey while I was coding,and now with Apex, everyone looks at meand they’re like, "Dude, you did sowell in the app space and now you’rebuilding what? Like, you’re making content,you’re trying to be an influencer."I feel that, like I feel the pressure andit fires me up. If you feel like youhave that— for lack of a better word—you have that dog in you, create a senseof urgency. 100% agreed. Now, the lastquestion that I want to ask you—we askall founders that we interview onStarter Story—what would you say toentrepreneurs who are just getting started?
Yeah, I think one of the things that hasWhat helped me most succeed is trying toabstract myself away from what you hearon social media and what others aretelling you to do. You have to be able tothink on your own and think from firstprinciples, as opposed to constantly justdoing what others say. There’s a Navalquote that a friend recently reminded meof: if you want to make the wrongdecision, ask everybody. Love it, man!
Blake, I appreciate you coming on StarterStory and sharing all of this value. Ican’t wait to see what you build next.I’ll be watching. Take care, man. Cool.Appreciate you, brother. Okay, recappingthis episode: what I think made Blake sosuccessful is how hard he went oncontent marketing. I’ve done a lot ofresearch on businesses, and nearly everyreally successful bootstrapped VCapp like this purely got traction fromcontent. I think the most successful VCfounders or people building iPhone appstruly understand that product isnot as important as distribution, asdistribution and attention wins the game.
If you want to win in VC, especially ifyour app is not niche — it’s like acalorie tracking app like this — then youmust be ready and excited for theIn the content game, you must already be thinking about what TikToks you’regoing to try, all the channels you cantry, and even validating your idea in thefirst place through content onlinebefore you even build something. This iswhy I created the Starter Story Academy.
Not only to have you focus on buildingan idea, but most importantly, figure outhow to get attention on that idea, how toget your first customers, and how to getfeedback from the customers so you canbuild a better product that willresonate with thousands, if not millionsof users. If you’re serious about takingthe first step, then definitely check outthe Starter Story Academy. Just head tothe first link in the description if youwant to learn more. Much love, and I’llsee you guys in the next one. Peace![Music]