For the past two years I’ve been banging my head against the wall trying to build a good news App, and despite great reviews, I’ve failed.

So I dropped the idea of making an App for Inside.com and focused 100% on a medium that was more interactive — email!

Why did news apps fail

It seems that very few people need a dedicated news App. My team poured their hearts and minds into designing a news App that I think is one of the best ever, but we still didn’t get attention. The reviews were great: extensive press coverage, featured by Apple, and positive feedback from users — but we didn’t break through. It’s not just us either, Circa, Zite, Trov or Pulse. Some of the big companies’ readers still work, like Facebook’s Paper and Yahoo News Digest, which are well-built and reliable but haven’t exploded.

News apps all failed because social networks succeeded.

  • In terms of user experience, people want news filtered through their social networks. Clicking on a news link shared by a friend is easier and more fun than opening it on a separate App.

  • From a design perspective, you’d think people would need an App for every experience they have in their lives: photo sharing, news, shopping, socializing, watching videos, emailing, chatting, and so on. But there’s an all-encompassing social platform, and a lot of those projects are already integrated into it.

The upshot: Social is eating the world. Photos, videos, news and messages are all wrapped up in social networks, and we all know that Facebook and Twitter are hoping to bring e-commerce to their platforms (although they haven’t been successful so far, the idea is already working in Asia).

Apps are a tough business

To build a truly modern App startup at a “reasonable scale,” you need about a dozen people: Each platform has two developers (iOS, Android, Web), a product manager, a designer, a CTO, user growth/marketing, plus a few business managers (CEO, COO). A couple dozen people means you’re spending somewhere between two and three million dollars a year in San Francisco. Using a back-of-the-envelope calculation, I found that a startup in the Bay Area spends $12K a month on an employee who is “all in” and another $10K outside the Bay Area.

A great trick is to start on just one platform and cut that amount in half. There’s no reason to replicate on all platforms before the product hits the market. If I were to start another App company, I would make some adjustments: just do one platform until you grow like crazy.

Lesson learned: Grow your business dramatically on one platform, then launch a second.

How to transform?

A few months ago, I took a close look at everything we were doing. I observed that people would open and open our email alerts, but not our App. Looking at the 180,000 email addresses I’ve accumulated over the past few years, I decided to do Inside.com and try to push them by email. We split the list into two sections: people who are interested in the product; And the top 10 percent of the audience who seem really excited. For the latter, they open half of the emails we send past, and we send briefings twice a day. In the first month of the experiment, we added 800 email addresses to the list. Nearly halfway through the second month, we had added 3,900 email addresses to the list.

Here’s how I read it: Many people like to get their news via social media, and a large percentage expect to receive high-quality summaries of top news, such as presidential briefings.

The crazy thing about this business is that it only takes three people to run it, not 12 at all: a writer, a CEO and a growth/marketing hacker. Three people are enough. Now that the first two positions are filled, I’m looking for growth hackers.

When to transition?

  • If other entrepreneurs doing the same thing die and you’re still alive, one of two things will happen: they can’t do it, you can do it; Or maybe you’re about to die.

  • Looking at the market again, it became clear to me that while we were proud of our product, like other news apps, we weren’t growing.

  • For startups, without growth, they are dying.

It’s that simple.

So, we’re not growing, our competitors are dying — it’s time to retreat!

  • If you’re either growing, you’re dying.

  • If your competitors are dying and you’re not growing, you’re dying too.

  • If your competitors are dying and you’re growing, congratulations — you’ve come out on top!

  • If you’re ready to transition, look at everything you’ve learned and apply it to the most promising part of your failing company (in our case, mailing lists).

  • Don’t try to log on to several platforms at once, succeed on one and then expand to the next.