By:-Frederic Lardieg,Ventures Team at Octopus Investments
2013 was a bumper time for mobile apps. It was the year we saw a 17 year-old school boy sell his news summarising app to Yahoo! for £19 million, while conversely Snapchat, which hurtled onto the scene attracting over five million daily users, reportedly rejected a multi-billion dollar offer from Facebook. Within the same 12 months, the UK government launched the Future Fifty Programme to identify the fastest growing UK companies, and listed apps including Hailo, SwiftKey and Shazam.
Yet while mobile apps have undoubtedly caught our attention this year, there is nonetheless no one particular app that stands out as the embodiment of the mobile era. We had Amazon for the e-commerce era in the 1990s, Facebook for the social media era in the mid 2000s – so who will be the multi-billion dollar ‘poster child’ for mobile apps?
I pondered over this very question as I attended LeWeb 2013 in Paris – an annual conference that sees the biggest names in tech come together to discuss the future of the industry. My belief in the potential of mobile apps was certainly confirmed – I was blown away by Uber’s CEO Travis Kalanick. His passenger pick-up app was valued earlier this year at $3.4 billion – incredible for an app founded just four years ago.
There was also a good deal of excitement around digital health apps at LeWeb. FitBit and JawBone are two successful examples in this space. They rely on wearable devices to track activity including distance walked and number of steps, which can then be monitored through the user’s smartphone. Currently such apps are mainly the reserve of ‘fitness freaks’ and ‘tech geeks’, but wellbeing apps have the potential to revolutionise the health industry – a diabetic for example could benefit from the convenience of monitoring glucose levels through his or her smartphone. For the true potential of digital health to be realised, mobile phones will require additional sensors. But with smartphone technology evolving at breakneck speed, it’s just a matter of time before wellbeing apps explode into the mainstream.
Apps that boost communication are also a hit with users. One of the key reasons Snapchat has grown so rapidly is the immediacy of the images, which reflects human communication more realistically than traditional social media sites. Moreover, in the wake of NSA revelations this year, the transient nature of the pictures appeals to a privacy-conscious general public. Snapchat is just the tip of the iceberg – in 2014 we can expect to see a number of apps rising up, relying on the concept of ephemeral content.
The app that really stood out to me at LeWeb is ready to take off right now. Notegraphy is an app that beautifies text before it gets shared across social networks – in a sense it’s the Instagram of text. Launched less than two months ago, the app already has over 175,000 users. With Notegraphy’s simple and intuitive user interface, plus its use of design to enhance communication, I can see this app really soaring.
While I was astounded by the innovation of today’s growing mobile app scene during the LeWeb conference, it struck me that many of the ideas that we currently see flourishing as mobile apps were invented 10 or 15 years ago. However, without the sophisticated feature-rich smartphone market that we have today, these ideas failed to reach their full potential.
Back in 2000, I worked for a London-based start-up called Digital Rum, which had developed a fully-featured mobile commerce platform that allowed people to compare prices and buy goods straight from their phones. At the time, few had any idea how to use the mobile internet and it was too expensive for most consumers anyway. Similarly, without any apps, or an app store for that matter, reaching consumers was a real challenge.
Now as we look to the year ahead, it’s a very different story, with global smartphone penetration reaching 1.4 billion this year. The time is ripe for mobile innovation – it’ll be exciting to watch who breaks through to become the icon of the app industry.
Fred Lardieg is a mobile investment specialist – having worked for Sony and Vodafone in the past, he now focuses on identifying the next great mobile opportunity for Octopus to invest in. Octopus’ portfolio includes the likes of YPlan, SwiftKey and most recently Kabbee.