Still in Business

Sprout Apps made it’s first dollar on this date last year! The best thing has to be that I’m still making dollars!

If you want to know more about all the things that happened over at Sprout Apps I’ve published (some-what of) a year in review. I tried my best to show how much Sprout Invoices has grown as a product, something that I found is rather hard to do without busting out stats on commits and code base changes. Anyway…Sprout Invoices had 10 major updates, Help Scout Desk had a few, and Sprout Clients was released.

On the business side I learned a lot — so much that I’m only able to cover a couple biggies.

A Monthly Subscription was a horrible idea.

I wrote about the pricing structure and the reasoning before launching…

[I] wanted to create a monthly recurring rate for Sprout Invoices for a few reasons…[I] think people can better relate to a monthly recurring charge…a similar pricing model will be easier to match up against the invoicing services.

…I also had two other business reasons:

  1. Low entry price would bring more customers.
  2. Monthly payments have a naturally higher renewal rate over a longer term.

I’ll let you in on a secret that I’ve only told a few others: both were 💩 ideas in practice. After about eight months I determined that the having this mixed monthly and yearly licenses caused some major issues:

First, it confused customers. While I had thought people would be appreciative of the monthly rate, especially since I wanted to pull the majority of customers from Freshbooks and Harvest, it constantly led to inquiries asking about the basics. It wasn’t a matter of messaging either, with an A/B test of the pricing page in April I found people either couldn’t find the value or felt overwhelmed with the mixed subscription option.

Now, I only offer a yearly license (which renews) and conversions are up, a lot.

Second, I found out with the customer value being so low to start that support was an issue and it would always be an issue. Regardless if the lifetime value was estimated to be $XXX, naturally having the majority of support front-loaded wouldn’t be cost efficient unless customers never cancelled. Never isn’t possible.

Third, the entry price being so high was mitigated by a “hassle free money back guarantee”. This allows prospective customers to give it a shot and hopefully find the value within 30 days.

Money Back Guarantees work!

My sense is that a MBG frees the customer to love the product, and find the value on their own. No one wants to be “stuck” with a product they bought regardless of great value, instead finding the value in something creates loyalty.

I’ve found that refund requests are down from before, reasoning:

  • People are waiting longer to ask for a refund, which allows for…
  • People asking for help. Providing support within those 30 days are unlikely to ask for a refund because…
  • Great support is a feature that customers don’t value until it’s seen.

I’ve had numerous incidents when a customer has asked for a refund only to change their mind after I simply asled “before I process your refund I’d like to know if there is anything I can do to help…”. Goes to show that customers are impatient with the help they need with a product they bought for a reason, and providing great support allows them to see the value in their purchase.

Discounts and E-Mail Marketing For the Win!

I wrote about this a while back, it simply works. Discounts work too, duh.

Discounts that don’t work: ones that discount the initial payment of a monthly subscription to about nothing. That was a terrible idea for just about every reason you can think of; now that you know relying on lifetime value to offset support costs is a dumpster fire of a strategy. Reviews

Asking for reviews to “help the growth of” your product is not only being honest with your customers but surprisingly effective. Not only do our happy customers write reviews but those reviews create paid customers. As you would have guessed the majority of sales come from Sprout Invoices users that downloaded from .org, with our rates so high it helps people decide between a plugin with terrible reviews and mine with great reviews. The strategy to focus on pushing happy customers to review helps combat the long term problem we will have with the competition — those damn “installs” count.


With those changes in late April I was able to turn the ship, as you can tell from the graph below. As you can tell earnings have drastically increased, which can obviously be attributed to removing the monthly subscription 1

Screen Shot 2015-08-12 at 2.28.13 PM

The most important point in this report is the yellow dot for July, only because that was the first month Sprout Apps hit a profit. Meaning, since Sprout Apps has been a full-time job for me for this last year, a “profit” simply means I didn’t have to dip into savings to pay myself for the time, instead I could write myself a full pay check.

Goals, am i right?

This has been a long time coming, it just so happens to be a year of a lot of work — taking twice as long as I would have hoped. Here’s to another year, hopefully with some help to grow faster.

Cheers! 🍻



  1. sales have also increased (it’s hard to tell with this graph since it includes sales from free products).