Runna · B2C · running training app
Aim the app at first-time runners doing couch to 5K, not all sports
Earned a strong valuation; Strava bought it to reach beginner runners
What they did
What happened
In their words
Josh Peleg - $172M of App Building Advice in 50 Minutes
Josh Peleg… really boost the valuation. So if we take an example, if we take let's say Flo, for example. Right now, we all know Flo to be one of the top health apps. But a few years ago, it wouldn't be able to define itself as one of the top health apps. So what did it do? It narrowed down the category of health into women's health, or or menstrual cycle tracking, and it put itself in a position where it could comfortably define itself as the number one app
Josh Pelegin the women's health niche. So they were taking a larger niche of health, and they were narrowing it down to women's health. At that point, with their, you know, 70 million-plus monthly active users, they could become the first women's health unicorn and raise their 200 million-plus from from General Atlantic at the 1 billion-plus valuation, because not only were their metrics amazing, and and their funnels were amazing, and their testing was amazing, but they could define their category narrowly enough to very confidently, without a doubt, define themselves as number one in that category. And, you know, we could take another example here. Runna. Runna didn't try to be the number one sports app in the world.
Josh PelegIt tried to be the number one running tracking app, right? The number one couch to 5K app in the world. And that's what it did successfully, and that's what got it a great valuation in order to be acquired by by Strava.
Joseph ChoiIt's not just health tracking. It's specifically women's health. And I think in the very beginning, they didn't even call it women's health. They probably just called it like period tracker. And then for Runna, it's like not just fitness. It's like specifically running, and then I think they even it's like 5K to marathon training. It's even narrower. But my I guess my question here is how narrow do you actually have to be? Can you be like would …
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More from this episode
- Pitch the app as #1 in women's health instead of competing in all of healthBecame the first women's health unicorn: $200M+ raised at a $1B+ valuation
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- Build the app around a trusted podcaster, and put his voice in the first sessionTiny download numbers earn $200K-$1M+ a month; creator-dependence makes the app harder to sell
- Run over 100 experiments a monthGuest cites it as part of what made it a top health app; no direct numbers
- Buy a beginner running app so new runners later move up to your app
- Buy a viral food-scanning app for its knack for pulling in new users
- Sell the app again after its growth has already slowedResold for over $100M less than the $475M paid five years earlier
- Buy apps that already found fans, then add a full team to grow themWorked really well, per the guest; no portfolio numbers given
- Buy apps that get lots of downloads but lose users, then fix the productA couple of such deals brought outsized returns for founder and buyer, per the guest
- If you charge under $10 a month, test $20 on 10-20% of users
- Use weekly plans for apps people need for a short time, like datingWorks well in dating and follower-tracking apps; fine for cash flow, weaker for an exit
- Pick a buyer type, study its last 5 deals, and start talking a year earlyGuest's favorite deals came from founders he'd messaged with for ~12 months
- Once a TikTok works, spin up 20 to 100 more videos on the same ideaBuyers value a repeatable viral machine over one-off hits; no numbers given
Tags: category-definition, beginners