MyFitnessPal · B2C · calorie tracking app
Buy a viral food-scanning app for its knack for pulling in new users
Unknownexit-maportfolio
What they did
MyFitnessPal acquired Cal AI not for its tech but for its top-of-funnel skill (Zach and team are strong distributors), aiming to keep new users coming in and eventually graduate them to MyFitnessPal's fuller feature set. Guest's reading, prompted by the host.
“MyFitnessPal was not buying the tech of Cal AI. I think they were also buying the funnel. Zach and the team are incredibly good distributors, and they understand top of the funnel really, really well in a way that MyFitnessPal doesn't.”
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More from this episode
- Flo: 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
- Runna: Aim the app at first-time runners doing couch to 5K, not all sportsEarned a strong valuation; Strava bought it to reach beginner runners
- Waking Up: Charge $20 a month or $150 a year for a meditation app~25K downloads a month bring in over $1M a month (Sensor Tower estimate)
- Waking Up: 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
- Flo: Run over 100 experiments a monthGuest cites it as part of what made it a top health app; no direct numbers
- Strava: Buy a beginner running app so new runners later move up to your app
- MyFitnessPal: Sell the app again after its growth has already slowedResold for over $100M less than the $475M paid five years earlier
- BlueThrone: Buy apps that already found fans, then add a full team to grow themWorked really well, per the guest; no portfolio numbers given
- BlueThrone: 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