Sub Club by RevenueCat · 2025-11-12
Why AI Probably Won’t Kill Your App (But Ignoring It Will) — Eric Crowley, GP Bullhound
David Barnard and Jacob Eiting (RevenueCat) talk with Eric Crowley, GP Bullhound banker who leads its consumer subscription practice, about his annual report. Topics: subscription fatigue being overplayed, why Strava bought Runna (TAM expansion to non-athletes plus a bundle tier), AI as headwind (Google/SEO traffic fracturing) and tailwind (faster testing, moats via hardware and community), every client building web funnels to recover 15-20% margin, category opportunities (Strava for pets, screen time), and the Bending Spoons acquire-and-cut model.
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Numbers mentioned
| Subject | Metric | Value | Quote |
|---|---|---|---|
| marketConsumer spending as share of the (US) economy | share | 70% approximate | “If you just think about the math, consumers are 70% of the economy.” |
| aggregateSubscriptions held per consumer | count Crowley's projection for subscriptions per person in 2-3 years (vs ~10 today, 0-2 in 2018) | 15–20 subscriptionsper consumer projection | “I don't think you're going to have 100, but I won't be shocked to see everyone having something between 15 to 20 in the next two to three years” |
| aggregateSEO traffic of businesses Crowley knows (clients and friends) | growth rate Year-over-year SEO traffic drop attributed to AI search | +-40–-30%/year approximate | “I've had clients, I've had buddies that are running businesses, where their SEO is dropping 30, 40% year over year.” |
| benchmarkProfit margin recovered by moving app purchases to web funnels | margin Margin regained by bypassing app store fees; host notes it is not the full 30% since mature subs already pay 15% | +15–20% approximate | “People that are building apps of scale, getting 15 to 20% of your profit margin back is a big deal.” |
| benchmarkRevenue threshold above which apps should be doing web payments | revenue Eiting: apps past ~$1M/month (maybe less) should be doing some off-App Store payments | USD 1M/month approximate | “But yeah, basically anybody past a million dollars a month, maybe even less than that, probably should be or is doing some amount of this.” |
| marketApple App Store commission on subscriptions after year two, and Google Play on subscriptions | commission rate Store fee drops from 30% to 15% in subscription year two on Apple; Google charges 15% on subscriptions from year one | 15% | “a lot of these more mature consumer subscription businesses are already at 15% because Apple drops it to 15% at year two.” |
| Flo Health | growth rate Flo had doubled in size by the time of GP Bullhound's deal, despite fears Apple's cycle tracking would crush it | double the size approximate | “When we did the Flo Health deal, everyone was concerned that Apple was going to come out and just crush Flo. Not even close. Flo was double the size when we did that deal.” |
| Bending Spoons | valuation | USD 11,000M approximate | “the elephant in the room would be Bending Spoons, which just raised an $11 billion valuation running this playbook.” |
| Bending Spoons | share Share of an acquired company's employees let go within the first month | 97% approximate | “they will buy an app or a subscription business and they will fire 97% of those employees within the first month.” |
| Bending Spoons | team size Core team that absorbs each acquired business | 600 people approximate | “They're taking the same 600 people and just adding business on top of that and running it.” |
| Evernote | team size Evernote employees Crowley believes Bending Spoons kept, from hundreds before the acquisition | 2 people estimate | “I think they employed two people from Evernote, if I remember correctly. It might even be less than that now. That was a business that had hundreds of people before the acquisition.” |
| Evernote | app rating App Store rating after the Bending Spoons takeover and layoffs | 4.4 stars | “Evernote is still at 4.4 stars in the App Store, so they must not be doing all wrong.” |
| AOL | rank Email clients worldwide (rough) | 8 estimate | “I mean, it's still the number eighth email client in the world, something like that.” |
| Opal | price | USD 120–130/year estimate | “I do think it's fascinating how Opal charges, I think, what, 120, $130 a year” |
| Ladder | price Monthly plan; host stays on it despite the ~$130 annual plan being cheaper | USD 30/month approximate | “I've still been paying 30 bucks a month myself and 30 bucks a month for my wife on Ladder fitness” |
| Ladder | price Annual plan | USD 130/year approximate | “it just feels like such a big drop of $130, but it's going to save me a ton of money.” |
| benchmarkA 'great' independent consumer app business that coexists with big-platform competition | revenue Paired with ~$3M/year cash to the owner | USD 10M/year illustrative | “you can easily build a great business that does 10 million in revenue and pays you 3 million in cash a year” |