The Apps Big Bang: The Expanding Universe of App Development; Tips for Tech Entrepreneurs

by Joycelyn James on July 30, 2013

Apps Big BangEarlier this month, the scientific community celebrated the 43rd anniversary of the first walk on the moon.  When you consider that the average smartphone has more processing power than the computer on the lunar module, it’s easy to see how advanced our technology has become.  Along with those advancements come new ways to interact with technology.  Many of us with smartphones use apps as our go-to source for all kinds of information, from local weather, to streaming music, or – my personal favorite – where to find a premium cup of coffee.  (Yes, there’s an app for that!)

With new mobile devices coming out just months apart, and close to one million apps available for use, it appears that if the 90s gave us the tech boom, the new millennium gave us the Big Bang with app development.  As Lisa Jones Johnson, President and CEO of NextGen Media, put it earlier this month at the 2013 MMTC Access to Capital Conference, we are at a point where we are recreating the digital ecosystem.  During the panel “Spurring Innovation: Tips for Tech Entrepreneurs Who Want to Turn an Idea into a Business,” Johnson and four other tech entrepreneurs shared their wisdom on how to get into the market and build a business.

With all that’s going on in the tech space, there is plenty of room for women and minority entrepreneurs to gain a foothold in the industry, and not be left behind as they were during the emergence of broadcasting in the early 20th century.  A community of diverse app developers who create engaging content is important as a means of incentivizing price-sensitive consumers to adopt wireless broadband.  Plus, diverse developers make using smartphones that much more interesting for those of us who already use these devices on a regular basis.

However, those with the vision for an app don’t always understand the intricacies of design and marketing for a successful app.  “I believe, from a content perspective, the future is ‘how do you manage all of that huge, enormous breadth of content that you find on the internet?’” says Johnson.

Apps Are Where Media and Tech Converge

The entrepreneurs who participated on the panel come from media and engineering backgrounds, but all find themselves successfully navigating the app development market in different ways.  Clayton Banks, President of Ember Media, started his career in network cable, but believes today’s opportunities are in the digital space, whether you work in media or not.  “There is so much opportunity.  It can transform your community.  It can transform your life,” he said.  Currently, Banks does software development including augmented reality software, which can add graphics and sound to the natural world, often through use of a mobile device.

Most apps aren’t as advanced as those Banks develops, making entry into the app development market fairly easy as far as technology is concerned.  As York Eggleston, Chief Executive Officer of Semantic Labs and YE Ventures noted, the majority of apps on the market are not too complicated and can be built or rebuilt within a few months.

Apps Barriers to Entry Are Low, But Not Cheap

Leveraging tech is about using what has already been created, according to Eric Hamilton, Chief Marketing Officer and Co-Founder of Around the Way, a locator app designed to find Black-owned businesses in any given neighborhood.  Hamilton “curates bits” and uses a free application programming interface (API), which he states can lower developers’ cost of entry in the app market.  “We never went after money,” he stated when discussing how he and his two co-developers avoid venture capitalists, which he compared to “vultures” and “vampires.” Hamilton advises new app developers to “keep their day job” until the product is self-sufficient.

Cost of entry is no small issue for early-stage entrepreneurs, and access to capital is one of the major challenges for minority entrepreneurs who, historically, do not have intergenerational wealth or traditional financing to start a business.  Many tech and new media entrepreneurs discover that getting the product developed may not incur significant cost.

Johnson, who recently launched a social media platform called ReportN, stated that the low cost of entry can be a blessing, but may also present a challenge because marketing apps can be costly.  This is the critical issue in the all the digital space because most apps and websites are free and generate money from ads.  A successful marketing plan is necessary to drive users to an app or website.  “Before you spend a lot of time and money creating something, make sure you have your marketing plan in place.  That’s where the rubber meets the road in terms of the digital space,” says Johnson.

Eggleston agreed that app entrepreneurs can incur significant costs, particularly for more complex apps and those designed to work on a larger scale.  “Hard stuff…costs more to build.  Even if you are actually moving these free bits around, the intellect to put them together to move them around costs money.  Experts cost money,” says Eggleston, whose company built 30 mobile apps for others in the last year and a half.  Sometimes, strategic corporate partnerships are needed to obtain financing, particularly where clients want what the app provides, but do not want to build the app.  “If you can figure out a way to save a company money with the efficiency of processes, that is the new trend,” states Hamilton.

While all of the panelists were app creators, they made it clear that the app market is about revenue generation.  “It’s about building businesses around products, not just building products,” said Eggleston.  Bruce Lincoln, Founder and Chief Design Scientist of Urban Cyberspace Company, acknowledged that working with others is necessary because there are no “lone wolf developers,” but made it clear that he owns all of his intellectual property.

Apps and the Attorneys: IP and Privacy

Though apps are not regulated by the government, business practices related to them can be.  As such, some of the panelists recommend that new entrepreneurs consult with an intellectual property attorney early on.  Jackson suggests a copyright audit to discover potential IP violations before launching an app or website, because, “It’s a lot harder to undevelop [the app] after it is done than it is to change it before you launch.”  According to Eggleston, “You can lose a lot with a cheap lawyer.”  Eggleston, whose first set of patents cost about $250,000, says he files for his IP before he starts building a lot of code.  “Even after you get [the patent], it costs you to defend it.”

Entrepreneurs also need to be aware of privacy issues that arise from how an app operates.  Many apps require access to location, contacts, and websites on the consumer’s smartphone.  Johnson provided an example of an entrepreneur who outsourced some of the development of their app which, unbeknownst to the entrepreneur, contained data mining code that was prohibited by guidelines established by the state Attorney General.  Between terms of use, privacy policies, and copyright concerns, Johnson thinks it is worth the cost to find an attorney with experience in the field.

Apps Building Communities, Not Just Businesses

To be clear, these entrepreneurs aren’t all about the bottom line.  Lincoln stated that one way minorities in tech could take advantage of the recent boom is through for-profit social enterprise.  Lincoln believes app development in STEM and entrepreneurial literacy is key.  “We need to apply the new knowledge to our communities,” Lincoln stated.  One method would be to bring tech pilot programs that are used in underserved countries overseas back to the U.S. to benefit underserved communities.  “If you’re able to make something work in Uganda and build an apps lab, why can’t you do that in Harlem or Baltimore?” asked Lincoln.  Paraphrasing Marcus Garvey, Lincoln stated, “We need to produce a premier class of scientists and engineers who are trained in the utilization of the science of capitalism for the betterment of those who have most recently come from bondage.”

You can view the entire panel discussion on spurring innovation in the app market at the Access to Capital page of MMTC’s website.

  • Joycelyn F. James

    Joycelyn F. James, Esq. is a graduate of the Institute for Communications Law Studies at the Catholic University of America Columbus School of Law. She currently serves as the Cathy Hughes Fellow for the Minority Media & Telecommunications Council, where she works on matters that focus on the advancement of minority and women’s entrepreneurship in the nation’s media and telecommunications industries.

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