How I acquired a mobile app on Flippa (and grew it from $700 MRR to $5.4K MRR)

This week I interviewed Norbert, the owner of AutoForward SMS, an Android app which allows you to automatically forward SMS messages to an email address and/or POST the SMS to an URL.

Norbert acquired the app on Flippa and managed to grow it from $700/MRR to $5400/MRR. Here's his story:

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

Hi, my name is Norbert, I’m a software engineer from Austria, living in the US for a couple of years now.

I started with cloud/online businesses in 2016 when a friend of mine (@rbluethl) and I built a SaaS in the ad tech industry. It allowed its users to host their ads globally with a couple of tweaks that increased conversion rates. It was back then when I caught the cloud/online bug and I’ve been hooked ever since.

Things changed in 2018 after moving to the US. I needed a regular job (for visa purposes) and so I started working 9-to-5 in the tech industry again.

Fast Forward to 2021: After 10 years working as a full-stack software engineer, I started to realize that I needed a (drastic) change.

Not only didn’t software not interest me as much as in the early years, but I also realized that it would never allow me to be free (in a geographic & financial sense). Corporate culture also always felt like a burden, making me unnecessarily slow preventing too much progress.

I wanted to get away from pure coding back into something like SaaS direction where I could still use my tech background but also learn about marketing and sales. I also wanted to be in a field where the payoff can be 10X/100X/1000x of what I put in.

Around December last year (2020), I finally started putting my plan into action. I needed multiple income streams and so I went out to a bunch of platforms and started searching for feasible projects to buy on sites like Flippa, MotionInvest and EmpireFlippers.

I found and bought this listing from Flippa. I’ve since managed to grow it from 500subs / $700 MRR to $5.4k MRR and about 900 subscribers (within 6 months).

Flippa has thousands of listings. Why did you choose this one particularly?

I chose this listing because out off all the options it had a reasonable valuation and was in a price range that made sense for me. It was small enough to not hurt badly if I fail but also big enough so that any future return would make a difference.

I could also foresee it grow to replace my 9to5 job income relatively quickly. (which it did). From a personal perspective, I also really liked the seller (Australian) - She was nice and absolutely open about her motivation to sell, opportunities for growth and where the pain points were.

Also, the income was stable (even slightly ticking upwards) - which is uncommon on Flippa. Many ppl sell of their projects when they are in free-fall.

What went into improving AutoForward SMS once you acquired it?

I faced some technical challenges right away. The old tech stack was severely outdated - I had to make sure that the service would keep running amidst API deprecations and other old-as-hell software problems.

The early days were mostly about keeping the app alive and not so much about improving it.

The first real change to the app was the pricing structure. Some of the app’s key features were for free and didn’t generate any income at all. I made sure that everything that provides value for our customers would also generate income for us. Needless to say; some of my clients didn’t like that much.

The second big revenue driver was the introduction of high-volume plans for corporate users that used our app for their business. Corporate customers don’t mind paying for a service that solves a real problem. Right now, corporate subscriptions make about 75% of the revenue.

How did AutoForward SMS attract users before you acquiring it?

The previous owner didn’t do any marketing at all. Your only chance of encountering AutoForward SMS was if you knew exactly what you had to search for. The only publicly visible information was the website. Users could find us via Google exclusively. There were no paid ads, no link-building, no social presence.

I was intrigued by the fact that a product with 0 outreach had around 500 paid subscribers. This, to me, showed tremendous potential.

How have you attracted users since buying AutoForward SMS?

We didn’t do much either yet. We spent time building a solid foundation (technically speaking) and only now start to market our product. Emails, newsletters, guest posts, affiliate programs, ... the list goes on and on.

The first milestone in terms of our marketing effort was the release of a brand-new website.

So far, SEO has driven all the traffic to our website (which is our only point of sale). What really helped us grow was a change in the pricing model and charge earlier, removing free features and adding high-volume plans.

Marketing, however, is our weakest spot! I’m nevertheless very excited to get going. We are also looking for someone with growth experience to join our team!

What's your tech stack?

The old app’s stack was comprised of a Kotlin app, PHP (Laravel 4.0) for the backend and, Stripe as a payment gateway. It was all running on a single server in Australia that took care of the load.

The new stack is cloud-native, runs entirely on serverless functions and is a real joy to work with. The app is developed using Flutter 2, with all the rest being handled by Firebase. The admin UI is Vue 3/Tailwind 2 web app. Stripe, which we knew and loved already, stayed on board.

For deployment and builds we went with GitHub workflows/actions.

What are your goals for the future?

We want to scale the app and make it as big as possible. For 2022, the target is to have 2000 paying customers and $15k MRR. There is no hard limit on how big we want this to be – the market will tell us when we’ve reached our ceiling.

From a personal perspective, I want to gain more XP in the SaaS/startup world so I can play in the next bigger league. We need to improve in terms of marketing, sales, but also networking. The progress we make with AutoForward SMS will enable us to do that.

Where can we go to learn more?

You can get in touch with me on LinkedIn and on Twitter. If you want to give AutoForward SMS a try, this is the website. Thank you!

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