How We've Grown a Profitable Cryptocurrency Education App

Hello! What's your background, and what are you working on?

Hello from Vancouver BC, Canada! Tom here from Altcoin Fantasy (ACF) — we are a cryptocurrency simulation trading platform that helps people learn more about cryptocurrency trading without losing their life savings. Players start with $100k USD virtual cash, and at the end of the contest (usually one week), the people with the most net worth will actually win real cryptocurrency, such as Bitcoin, Ethereum, Litecoin, etc.

I’ve been a developer for about nine years. I started my career working for smaller startups and eventually made my way towards bigger companies such as Dell and Electronic Arts (EA), but I’ve always wanted to have my own business. In 2014, I decided to take the plunge and began working on a marketplace app with a friend. We had enough initial traction to get into the 500 Startups accelerator (batch 8), and moved down to San Francisco for six months while we went through their seed program. Though we eventually had to close down the company, we met a bunch of wonderful folks along the way, and working on the startup gave me invaluable knowledge and experiences that have greatly shaped the way I approach startups and business in general.

A few years ago, I attended a bunch of hackathons with a team of four and we won a $20k USD grand prize. Since it was “free” money I decided to buy a bunch of video cards and started assembling mining rigs. At one point, our garage literally resembled the scene from season one of Silicon Valley where they are trying to manage the overabundance of servers being housed in their garage to support their fledgeling startup. Since then, I found myself constantly educating my friends about the crypto space, which compelled me to start ACF.

The platform is completely free, we make our money from sponsorships and private group contests. We started the year with about 300 users, and have grown to about 4,500 as of the beginning of March.

What my garage looked like at one point.

What motivated you to get started with Altcoin Fantasy?

I saw that there was a great deal of volatility going on in the crypto markets, and people were not making rational decisions or doing proper research when buying crypto coins. They would hear from their friend about a friend that supposedly got in early and instantly became very rich. Of course, the fear of missing out drove them to invest blindly, with no understanding of blockchain technology or how crypto or initial coin offerings worked. I felt strongly that this was not the right approach to investing, especially in an area that was extremely volatile and ran more hot and cold than Katy Perry. That's why we created ACF — to educate users about the different coins and basic marketplace principles, so that if they did want to invest and trade, they could do so with more information at their disposal. They could also experiment with trading risk-free while having some fun at the same time.

I started this part-time after work and on the weekends while consulting for another company. Fortunately I had kept a few coins from the initial mining operation and was able to use that to fund awards and prizes as I was building the prototype for ACF. The first contest had about 10 players and three of them won prizes. Around this time, I met my co-founder, Jerry, who worked at TD AmeriTrade previously and was super excited about the idea since he was also interested in the crypto space.

While you never truly know if you have the right idea, based on our growth and the feedback we’ve been receiving from our users, we feel like we’ve hit on something great. Many of our users are raving fans and incredibly supportive of the platform, often playing up to 12 hours a day. We ended up recruiting one of the users as a community manager because she was so passionate about ACF that we felt like we just had to bring her on board. When your users spend more time playing your platform than with their significant other, you know you’re onto something!

What went into building the initial product?

Luckily for me, I've attended many hackathons over the past five years, so I'm at a point where I’m able to create products on the fly from the experience I’ve gained through rapid prototyping. I built the ACF prototype in about six weeks, working on it part-time. At first, the goal was simply to build a simulation trading platform and let people participate in weekly free contests. Not everything worked in the initial release. I had dead links, but I would keep track of what people clicked on to determine what to build next.

The product has matured a lot since then, especially after bringing a crypto fan like Jerry onboard. We recently launched our native iOS and Android apps, and are working on building more educational features for our users. In terms of the technology involved, we used a Rails backend and React native to power our mobile apps. Fortunately, I held on to some of the Ether coins I’d mined — which went from $6 to $1000 since I first acquired them — and put them towards funding the project.

How have you attracted users and grown Altcoin Fantasy?

Unlike a lot of the products on Indie Hackers, we didn't have an official launch — it was very much a work in progress and I wanted to get the initial prototype out before investing a lot of time into it. We started the year with about 300 users and about 500 virtual trades. By the end of March we had about 6500 users, with 70k virtual trades in the system.

As part of our initial growth strategy, we researched Bitcoin games on the app stores. Naturally, I wanted to target Bitcoin game players since our initial product was a game revolving around crypto coins. So for version 0 of our Android app, we literally just wrapped an embedded web browser that pointed to our web app (our web app is mobile responsive), deployed that to the app store, and threw together ads targeting those users. We were able to buy clicks for less than 8 cents with a 25% conversion rate, and saw some great initial returns from those campaigns.

Here's a look at version 0 of our Android app (just a web browser wrapper):

We then experimented with placing video ads on crypto related Youtube Channels, paying 1 cent per view with a 10% conversion rate. I'd say we converted half of our 4,500 users from those ad campaigns. However, we can't afford ongoing paid campaigns because the gameplay is free and contests and sponsorships don’t generate enough revenue, so we’re implementing a system for users to refer their friends and hoping that will drive growth. When people refer their friends, they get ACF Points that they can use to enter specific contests or participate in special raffles. We are also working on SEO by doing guest blogs on Bitcoin and crypto trading related sites, but that will take a while to build up authority.

Some advice on growth — contrary to what most say, well placed ads can drive great user growth for cheap. You might think you know AdWords, but chances are you probably don't know everything about it, especially given the new features Google is constantly adding. To "hack" this, I requested an AdWords specialist review my ads and give some feedback (AdWords offers this as a free service, which is awesome). What was supposed to be a 15 minute chat turned into a two hour learning session because I wouldn't let the guy go. Every entrepreneur should take advantage of this! In the end, we had an AdWords campaign built around a custom intent audience, which goes beyond pre-defined audiences categories and reaches people as they’re making a purchase decision by targeting them as they’re actively researching a related product or service. Using fantasy sports players as our custom intent audience, we placed ads in specific Bitcoin apps. We paid relatively little for it, and It really drove relevant users to our platform.

Our growth over the last 3 months.

What's your business model, and how have you grown your revenue?

The contests are always free to play, as we want to get people into crypto trading in a fun and engaging way without losing real money. We have been paying contest winners out of our own pockets, but we've began building partnerships with different alt coins and crypto related companies in order to get them to sponsor our weekly contests. We charge these companies an administration fee of $500 and up for hosting the weekly contests, and brands looking to market provide prizes of $200-300.

We’ve also hosted private contests for special interest groups, and will be whitelabeling our product for conferences. We plan to start with conferences in the blockchain and crypto space before branching out to other areas. Similar to our partnerships, we’ll charge a fee to administer and host these private contests, which are a fun and engaging tool for conference attendees. We are also looking to host private contests for companies and their employees, initially targeting tech companies as we think they’ll have the most interest.

So far, we've secured two partnerships and have a dozen more in the pipeline, and we are generating about $800/month in revenue at the moment. Obviously this is not enough to cover any personnel expenses, so at this point Jerry and I are not taking salaries. However, because we’re basically only paying hosting fees and a couple of SaaS subscriptions for marketing, we have very low margins.

What are your goals for the future?

Our goal is to educate 100k players within the next six months. It's a lofty, but we believe we’re providing a value service to people — especially the folks that don't have experience in cryptocurrencies, but want to dabble in it risk-free.

The roadblock that lies ahead is obviously the fluctuation in the price of cryptocurrencies. If cryptocurrencies tank, then marketers and brands will be cautious as a result. However, that's not something we can control, so we'll just have to focus on the things that we can control. Moreover, as we continue to learn about our users, we can help brands create more targeted marketing campaigns.

We're continuing improving our product to add more educational features.

What are the biggest challenges you've faced and obstacles you've overcome? If you had to start over, what would you do differently?

The biggest challenge that we've faced is learning to make the mental switch between different aspects of the business that need to be handled day-to-day. Both Jerry and I are engineers, and having to switch contexts from product development to marketing, for example, requires a bit of mental gymnastics that can leave us feeling like we’re not operating at full capacity. We try to tackle the hard engineer problems during the first part of the day and then work on business development later on, usually right after lunch since it provides a good mental break.

The other challenge we face, which I'm sure we share with every other indie hacker, is trying to derive answers from a sea of unknowns. I think that in order to find product-market fit, one needs to have a framework in place that enables them to quickly find answers to questions as they arise. That means you need to keep a pulse on relevant data and make sure you understand what’s truly valuable in driving things forward, and not waste time on things that ultimately add no value to your users or to your business.

Finally, the transition from a developer to a salesperson was a little hard to adjust to at first, but after reading a few books, such as To Sell Is Human: The Surprising Truth About Moving Others and The Art of the Sale: Learning from the Masters About the Business of Life, I was able to frame my conversations around helping the other party rather than selling them on something. With ACF, this is especially true because we’re not selling anything to our users — in fact, we’re giving them free crypto!

Have you found anything particularly helpful or advantageous?

Leverage your personal network to bootstrap growth and partnerships.

As hackers, working in silos rarely means you'll get it right the first time. It was important was having a support network and people to bounce ideas off of. Equally as important is talking to your users. We thought we had a grasp on the demographics of our users (young, background in business), but when we dug in we found users of all ages, backgrounds, and professions that had heard of Bitcoin from their friends and families.

What's your advice for indie hackers who are just starting out?

My advice to indie hackers starting out is to always be learning. Had I not researched how blockchain works or been interested in building mining rigs, I might not have gotten into the space.

Make sure that you’re always keeping up with what’s new, because using the right tools and technology from the beginning can be the difference between optimizing your runway and dying. Technology advances at a very fast pace. Without my experience building native apps, we wouldn't have gotten the quick prototypes out.

Where can we go to learn more?

Want to learn more about cryptocurrency and maybe even try your hand at winning free crypto? You can learn more at AltcoinFantasy.com.

If you have friends and family who are interested in getting into crypto, tell them to try Altcoin Fantasy before they risk losing all their hard earned money! Or if you think your company can benefit from having a little friendly contest in the office, let us know and we can set it up for you!

Fellow indie hackers, what are your thoughts on crypto? Do you think it’s here to stay?