The first marketplace has emerged for transferring the intellectual property behind mobile apps -- source code, customer base, and all rights.
How much is your app worth? How much should you charge someone else to take it over and run with it? Chances are you would have no idea how to approach a question like that. How do you value your own work on the app, and what's the sunk cost for marketing it? You're unlikely to know with any certainty what its future revenue might be. And if you knew enough about its market niche and competition to put a price on the rights for the app, chances are you would be doing a better job with sales and marketing than you have been doing.
These are the kinds of questions that markets are good at answering. Last April Apptopia opened its doors in Cambridge, Massachusetts, and since that time the service has brokered $300,000 worth of app acquisitions, over 120 deals, according to Inc.com.
The site currently lists 478 apps for sale, at prices ranging from $5 million (there is only one of those) down to $1,000 (nearly 100 apps).
Apptopia acts as a trusted middleman and escrow agent for buying and selling apps. Buyers are more likely to believe download, usage, and revenue stats posted by a neutral broker like Apptopia than they would be to trust numbers from the developer. Apptopia pulls these stats daily from the developers' accounts in the app stores.
The company has built up expertise in figuring out how much apps are worth. Perhaps to offload some of the manual work involved, the company is about to launch a sister site, called MyAppValue, that will offer a free and self-service way for developers to get at least an initial idea how much their apps could fetch. (The site is currently collecting email addresses of interested developers.) When it is live, MyAppValue will generate a detailed report based on data in the developer's app store and analytics accounts -- which are accessed in read-only fashion, according to Inc.com.
I spoke with the company's marketing strategist, Chelsea Tharp, to get a better idea of what goes into the initial valuation of an app. MyAppValue has access to the entire history of an app's performance in its store -- downloads / sales, active users, revenue from in-app purchases, etc., and how these numbers have changed over time. The app's category has a large effect on its prospects and therefore selling price: utilities and business apps have a different level of popularity and appeal than music apps or games. "We make ourselves completely available to developers," Tharp told me, in order to arrive at the best possible price range to offer an app for sale.
The Apptopia site supports sellers making a bid for an app. I asked Tharp whether data from auction sales was getting fed back into the pricing model. Not yet, apparently. The sales volume is probably too small so far to make such an exercise meaningful.
In other areas where online secondary markets have developed, a single winner seems to have emerged. For buying and selling domain names one thinks of Sedo, for Websites Flippa, for tickets StubHub. It seems likely that other marketplaces for mobile apps will be launched, but Apptopia certainly has the advantage of the first mover.