Mosaic Group · B2C · app portfolio company
Only buy or build apps that could reach tens of millions without outspending giants
Built one of the leading app portfolios; sold to Bending Spoons
Workedmarket-selectionportfolioexit-ma
What they did
Screen each app or category on three lenses: (1) size: the product must plausibly reach tens of millions of dollars in revenue, avoiding a long tail of zombie apps doing a few hundred thousand each; (2) competition: a 'Goldilocks' market where you can take real share, e.g. RoboKiller was the leading independent spam blocker with carriers not invested and no big adjacent entrants; skip VPNs (everyone spends heavily on paid, so unit economics fail) and personal finance/budgeting (banks bid on the same keywords with far higher LTV); (3) existing demand vs. new category: existing demand allows ASO and performance marketing to pay back right away, while a new category means running at a loss to build demand.
What happened
Guest says Mosaic built one of the leading portfolios in the space and had a great exit to Bending Spoons.
- Stage
- Scale (M&A / portfolio strategy)
In their words
Sub Club by RevenueCat · Why Most Apps Hit a Revenue Ceiling (and How to Plan for It) — Patrick Falzon, The App Shop“a big market is great only if you can take a substantial share of that market, or a specific share of that market. If it is so competitive that you can't actually garner market share, it's not actually valuable to you.”
“VPN is a massive category, but there's also already a lot of people making a lot of money there. So, if you want to enter that category, you have to be prepared to spend a lot of money on user acquisition to be able to garner market share”
“the bank is is going to have a much, much higher LTV than you are ever going to have on your budgeting app. And so, like you will always lose that battle cuz they'll always be willing to pay more for that customer than you.”
Related topics
Get tactics like this every Monday
New tactics from the week's founder interviews, each linked to where it was said.
More from this episode
- Mosaic Group: Build several $30M apps instead of pushing one app past its ceilingGuest's answer to the $10-30M ceiling; three $30M apps can beat one $90M app
- Mosaic Group: Launch a new app for a new use case instead of piling features into oneGuest says slim apps segment users better and can earn more; no numbers
- RoboKiller: After the base subscription, offer data broker removal as a paid add-onReally successful; a good way to raise revenue per user (no numbers)
- Mosaic Group: Estimate lifetime value as a range of weighted guesses, then narrow it monthlyLets new products act on LTV before years of data exist; no numbers
- Mosaic Group: Count only 2-4 years of revenue per user and require fast payback early onConservative at worst; high LTV:CAC shows how much more spend cash could unlock
- Mosaic Group: Before rolling out a price test winner, check it still wins if retention drops 10-50%Annual-heavy price calls sometimes proved wrong a year later; this guards against it
- Mosaic Group: Raise prices about 10%; retention usually drops only a couple of percentNet LTV wins most of the time across the portfolio, if conversion holds
- Mosaic Group: Use early subscription cancellations to predict who will churnDidn't work: few cancel early; most cancel near the renewal reminder
- RoboKiller: Track whether each user is getting the core value, and step in when you fail themA wrongly handled call was highly correlated with churn, triggering fixes
- RoboKiller: Tell users how many millions of spam calls you blocked for everyone this month
- RoboKiller: Publish your own spam call data so reporters and regulators cite youRepeated WSJ, FT and cable news mentions; a brand halo that drove many organic installs
- Mosaic Group: Move ad designers to a different app every couple of monthsMore varied creatives, so winning styles became clear; no numbers
- Launch one ad channel at a time and change one bid per monthGuest's post-ATT method; new channels almost always underperform early forecasts
- Apalon: Switch apps from one-time paid downloads to in-app subscriptionsPhenomenal growth after the switch (no numbers)