Burner · B2C · second phone number app
Try a freemium version of an app where every free user costs money
Didn't scale without lots of capital; stayed a premium, paid-first app
Failedpricingmarket-selection
What they did
With VC money they tested making Burner freemium, alongside studying ad-supported competitors. Because every phone number costs money, giving numbers away to a million users and hoping 1% convert months later only works with a lot of capital. They saw a 'mile wide, inch deep' path and chose to stay revenue-driven and premium.
What happened
Could not see how freemium would become valuable; stayed premium, growth settled below VC-scale.
- Stage
- growth
- Effort
- Part of the experiments run on a ~$2M VC round
In their words
Sub Club by RevenueCat · Pivots, Funding, and Building Apps That Last – Greg Cohn, Burner“After a period of time, we were starting to run low on that cash and we had tried a lot of experiments, including trying to make a freemium business out of Burner.”
“So, you can't just give it away to a million people and hope 1% of them convert after some number of months.”
Related topics
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More from this episode
- Burner: Test a throwaway phone number by posting it in real Craigslist adsFlood of calls and 10-100x the response of the old app; confirmed a real problem
- Burner: Demo the unreleased app to people at SXSW and collect a waitlistNew York Times interview and a panel slot; $50K revenue on launch day
- Burner: Charge $1.99 upfront and price credit packs to cover phone costsAbout $50K revenue on launch day
- Burner: Drop the $1.99 download price once there is money to cover free users
- Ad Hoc Labs: Skip the next VC round and run the app at breakeven insteadBreakeven or profitable for 6-8 years, grew past $10M a year
- Burner: Add a monthly and annual plan with unlimited texts, calls and photosBiggest single jump in revenue in company history; subscriptions now 90%+ of revenue
- Burner: Phase out one-off credits so everyone goes through a subscriptionFairly high churn from short-term users; founder now thinks credits might have fit them better
- Burner: Capture people already searching for a second phone number instead of running brand adsSeveral million downloads a year of high-intent users; press-driven users didn't convert
- Burner: Add caller lookup for unknown numbers to the premium planVery popular and a driver of premium upsells; founder didn't expect it to win
- Burner: Offer 8 plans so short-term and long-term users pick what fits
- Burner: Let people choose on the paywall whether to take a free trialVery positive A/B test result; no numbers given
- Burner: When someone deletes their number, offer them a new oneRetains some users into a second number; 20-30% of new subs are returning users
- Burner: Add a white-label VPN inside the main app's premium planDrove a lot of premium-tier growth, but cost more to build than it should have
- Firewall: Launch separate robocall-blocking and business-number appsNeither got real traction; one was killed by an Apple feature
- Burner: Use paywall tools so the product team can launch tests without engineersFrom 1-2 paywall tests a month to several times that; about 1 in 4-5 wins
- Burner: Judge paywall tests by projected customer lifetime value from day-8 and day-30 data
- Ad Hoc Labs: Buy small apps that fit your users' needs and sell them inside your main app