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Profitable Apps Going Broke? Here's Why

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App Masters11:14Open on YouTube
0:00The #1 thing limiting app growth0:50Why cash flow matters more than you think1:40Real app portfolio numbers3:40The scaling problem most founders face5:55How Adapt Finance works6:50Weekly cash flow example8:40Why this matters for indie app developers10:20Case studies and final thoughts
Chapters show their main points

The bottom line

Cash flow limits the growth of profitable subscription apps, because Apple and Google pay out only after 45 days or more. Getting proceeds weekly lets founders reinvest in winning ads sooner and scale faster.

Key takeaways

  • Apple and Google pay out 45 days or more after you earn the money. 0:52
    • Money earned in January reaches the bank account in March.
    • Spending $10,000 to make $10,000 leaves the cash gone while the revenue is still pending.
  • Founders run out of cash just as their ads start to work. 3:36
    • With a $10,000 budget and $3,000 spent per week, only $1,000 is left by week four.
    • The $9,000 spent returns about $10,800, a 120% ROAS, but that money is still 45 days away.
  • Weekly payouts let founders put the same revenue back into ads right away. 5:54
    • Adapty Finance advances 85% of proceeds within 24 hours for a fee of about 2.5%, and it needs the Adapty SDK to verify revenue.
    • In the example, $11,000 of proceeds returns $9,000, so a $5,000 spend at 175% ROAS brings back close to $9,000.
  • The payout delay hurts indie developers most, so take the cash only once the channel is proven. 8:36
    • The $25,000 earned in April reached the bank in June, after it was already spent.
    • The advance is taken at week four, once the creative and funnel are profitable, not in weeks two or three.

Cash flow is the biggest thing that you should be thinking about, because Apple and Google take about 45 days plus sometimes to actually give you what you've earned.

Steve P. Young

Chapter summaries

0:00 The #1 thing limiting app growth

Scaling an app is a cash problem as much as a marketing problem.

  • Most developers never plan for cash flow as they scale. 0:34
    • The topic is how to scale faster and manage cash flow.
    • Steve P. Young runs the agency appmasters.com.
    • The opening promise is one thing limiting growth that founders may never have considered.
    • Cash flow became the main concern for his own company as it grew.

0:50 Why cash flow matters more than you think

Cash flow becomes the problem once paid ads start working.

  • Paid scaling begins when several ad creatives work at once. 1:40
    • Without ASO, the app must be pushed with ads.
    • One creative works, then a second, then a third.
    • He promises to break down the exact strategy with real numbers.
    • All the creatives are working today, so the next step is spending more.

1:40 Real app portfolio numbers

A bought app with existing revenue shows paid acquisition still works without cash stress.

  • The purchased app is profitable on paid, so cash flow is no worry for it. 2:34
    • Spend runs about $10,000 to $12,000 a month, ramped down to test if sales hold.
    • Proceeds sit about 30% below sales.
    • Week one, starting April 8: about $4,000 made in three days on close to $3,000 spent, so about $500 net.
    • He tracks weekly and uses only one channel.
    • The app launched at the end of 2024. Finding the right keywords and niche is the hard part, but ASO and ASA still work.

3:40 The scaling problem most founders face

A founder with a fresh app spends weeks learning, then hits the cash wall with a proven funnel.

  • The first weeks return little while the ads are tuned. 4:04
    • Week one: $3,000 spent, about $2,000 back.
    • Week two: another $3,000 spent, ROAS turns positive, with $800 in proceeds.
    • The app was built with AI, so the $10,000 goes to ads, not developers.
    • The figures use proceeds instead of sales to keep the math simple.
  • By week four the creative and funnel are proven. 4:46
    • A $3,000 spend brings $5,000, a 167% ROAS.
    • He says these numbers are achievable and not a 200% ROAS fantasy.
    • He knows what customers want, but he has to wait 45 days to spend more.

5:55 How Adapt Finance works

Adapty can advance cash quickly because its SDK lets it see and verify the revenue itself.

  • Verified revenue is what makes the fast payout possible. 6:06
    • The app must run the Adapty SDK.
    • Adapty sees the numbers directly, so no paperwork is needed.
    • "If they can verify those revenues, they can get you that cash really quickly."
    • Without the SDK, the service can't be used at all. This is repeated as the one condition.

6:50 Weekly cash flow example

Cash that comes back every week lets the ad budget grow week after week.

  • The advance gives week four a bigger budget than the founder started with. 7:03
    • The budget is back to $10,000.
    • Half of it goes to Meta, because the creative and funnel now work.
    • Meta delivers more efficiently at the higher spend, the example says.
    • The same step repeats the next week, so the budget keeps growing.
  • Payouts come weekly or on demand. 8:04
    • The advance is taken only once the channel is at scale and profitable.
    • The approval is easy because the SDK already shows the revenue.
    • Taking cash in weeks two or three is deliberately avoided.

8:40 Why this matters for indie app developers

Indies feel the payout delay most, because they can't wait for revenue the way big apps can.

  • Even big apps run on thin margins, and indies are squeezed hardest. 8:41
    • Most big apps are barely profitable.
    • An indie who finds a working channel must wait long for the money.
    • Steve has enough cash flow to be fine at $13,000 to $20,000 of spend a month.
    • Without that cushion, the wait is "the exact problem that you might be facing."

10:20 Case studies and final thoughts

Users report fast, simple funding, and it replaces a loan for scaling a proven channel.

  • Case studies show quick payouts and fast growth. 10:30
    • One developer grew from $5,000 to $80,000 in revenue in four weeks.
    • Another got paid the next day with no back and forth.
    • That user said: "We applied, shared our numbers, and got paid next day. No bureaucracy."
    • Finding the channel is the hardest part. Funding it without a loan is the next hurdle.

In the growth library

Steve P. Young, Founder of App Masters, app marketing agency. Paid acquisition for subscription apps is often capped by cash flow, because Apple and Google pay out 45+ days after the sale, so a profitable campaign can stall when the budget runs dry. Steve walks through a $10,000 budget example where $9,000 of spend returned about $10,800 and shows how weekly payouts through Adapty Finance (a sponsor of the video) let you reinvest sooner.

Lessons that draw on this:

More from App Masters · The whole library, and ask it anything

Transcript284 lines
The #1 thing limiting app growth 0:00
0:00

Coming up, I'm going to share with you the one thing that might be limiting your growth and you may not have ever [music] considered. Stay tuned. What is up App Nation? It is Steve P. Young, founder of appmasters.com, the app marketing agency that's going to help you grow your downloads and revenues so much faster than anywhere else. All right, because we just have the knowledge to help you scale faster and better. And talking about scale, I want to share with you something that most app developers may not be thinking about, especially as they start to scale. All right, so without further ado, let's get into this. Here it is, how to scale faster and more

Why cash flow matters more than you think 0:50
0:49

importantly, manage cash flow. As we've grown our company, cash flow is the biggest thing that you should be thinking about because if you're not aware, Apple and Google take about 45 days plus sometimes to actually give you what you've earned. So if you've earned, let's say $10,000 in the first month, that you're going to have to wait, let's say that's in January, you're going to have to wait until March to actually get that revenues into your bank account.

1:20

Where and if you're spending, let's say $10,000 to make that $10,000, well, $10,000 is already gone and you're going to have to wait a couple of months to get that $10,000 that you actually earned. So I'm going to break down this exact strategy right now. So here's a scenario. You found an ad

Real app portfolio numbers 1:40
1:40

creative that actually works, right? If you're not reliant on ASO, you're going to need to push your app and so you found an ad creative and then you found another one. And then you found another one. And it's all working today. Now, let me give you some real numbers for one of our apps. Here's an app that we purchased. Won't tell you exactly what the app is, but here's how much we made in April. That's when it actually hit our app portfolio.

2:10

So, here are the sales we made. Here are the proceeds. Killer, right? Such a big difference. 30%. Here's the May numbers. Here's the proceeds. Here's how I'm breaking down everything. So, the percentage of organic versus paid. And here's how much we're spending. We're spending about $10,000 to $12,000 a month. I really ramped this down just to see if I can get sales to maintain. But, right now for us, it's super profitable.

2:34

So, not a big deal here. But, let me show you what happens on a weekly basis, right? So, if I was strapped for cash, here's how much we spent in week one. So, we only made 4,000. We only We got it on April 8th. Made 4,000 that week, those three days. And we 3,000, but we spent about close to 3,000. So, we only made about 500. And then eventually, you know, I started figuring out how much I need to properly spend to make that money. So, from a tracking perspective for an indie, I've seen different ways.

3:04

I like to do on a weekly basis. And I'm only using one channel. So, if this is just further proof that ASO and ASA can still work today, right? The app was just launched at the end of 2024. It still works today. Finding the right keywords and the right niche, that's the hard part, but the app still works. So, right now, I'm pretty profitable. I'm not too worried about my cash flow right here, because I bought the app, right? Like, it already had revenues in place so that I didn't have to spend money from day one.

3:36

But, let's look at another scenario. So, let's say you just launched an app, and

The scaling problem most founders face 3:40
3:40

ASO is just not kicking in the way you want it to, because you're not an expert, but you're an expert in ads. So, I'm going to break down a scenario that most app developers face. Let's say you got $10,000 budget, right? You used AI to build the app. Now you don't have to pay somebody to build the app. You should have some cash on your hands to invest. Okay? Let me just kind of make sure that's out of the way. You got $10,000 in cash. You spend 3,000 of it in the first week. Okay? Something that we're doing, too.

4:07

You make about 2,000 back cuz you just started, right? Like not everything is going to work properly in the very beginning. So week two comes around. You now have 7,000 cuz you spent the 3,000. And now you're going to spend another 3,000. You're really tweaking the ads. Now you're starting to see some positive ROAS. Now you're saying, "Hey, I made $800." And I just kept this as proceeds instead of sales, so that just keeps the math a little bit more simple, right?

4:36

Next, week four. Now you got $4,000 in cash cuz you spent the 6,000 week two week one and two. And now you spent the 3,000 again cuz you're still not sure if it's going to maintain, but you've now really figured out the ad creative. You're like, "I know what my customers want. The funnel is strong because I've been watching Steve's videos, and now I've made $5,000. So I made $2,000 extra, and my ROAS is now at 167." But here's the problem. You're now in week four.

5:08

You spent 9,000 of the initial 10,000. You only have $1,000 left. Now you're deciding like, "Do I spend it all? What do I do? I got $1,000 left. I now have some ads that I know can scale profitably now. I want to spend more, but I can't because I'm out of cash. And now I have to wait 45 days to get my $10,000 in revenue. Close to 11,000, right? So your whole campaign right now you spent $9,000. You made 10,000 and $800, and your ROAS 120. So I'm not giving you a scenario that is not achievable. I'm not saying 200% ROAS, right? These are all achievable numbers.

How Adapt Finance works 5:55
5:54

So, what do you do? Well, this is where AdaptiFinance, our partners at AdaptiFinance, comes into play. They can give you your hard-earned cash, that close to $11,000 in cash, within 24 hours, right? The kicker is you need to be using Adapti, the Adapti SDK, because they need to verify those revenues. They can see it, right? If they can verify those revenues, they can get you that cash really quickly. So, let me play out that exact scenario once again, right? So, here it is again, just so you guys remember. You spent $9,000 within the first month, first 3 weeks. You made about $11,000 back. You achieved 120% ROAS. Pretty attainable numbers, okay?

6:38

So, Adapti is going to give you 85% of those proceeds back. So, now you get $9,000 back in cash that you can use. So, here's where the scenario looks like

Weekly cash flow example 6:50
6:50

now for week four, and you can see now we have way more money to spend. So, we took these revenues, this 11,000, we're able to get 9,000 back right away from Adapti. Now, we have $10,000 to spend. So, if we want to spend $5,000 because we know the creative works now, the funnel works, and we're like, "Hey Meta, go ahead. Spend a little bit more if you want." And Meta says, "I got you. I'm actually going to be way more productive and way more efficient and get you 175% ROAS, getting you close to $9,000 with that $5,000 spend." You can do that so much more. And then the next week, the same thing, cuz Adapti can do it every single week. So, you have way more money to spend week in and week out, all right? So, I know what you're thinking.

7:39

You're like, "Steve, tell me a little bit more about Adapty Finance. Well, I got you, Frank. All right, just picking on Frank here. So, here it is. If you go to adapty.io/finance, and better yet, just use the link in that YouTube video or that description below, here's what you can do. All right, so I want to give you guys exactly what's happening. Get 85% of your proceeds every week, weekly or on demand, right? So, you don't have to wait. And look, guys, I waited until week four, right? I didn't say go ahead and take that cash in week two, week three. I said, let's make sure that you're actually at scale, right? And you're profitable, and you figured things out to get that cash. So, you can go weekly or on demand, 85%.

8:26

Here's their fees, about 2.5%, not too bad. And then the approval is pretty easy because you're using the Adapty SDK. This is what's not being talked about enough, in my opinion. One, most

Why this matters for indie app developers 8:40
8:41

big apps that you see are barely profitable. Two, this is a huge issue for a lot of indies. Once you figured out a channel that's really working for you, you have to wait so long to get that money. Back to my numbers. This 26,000 finally hit my bank account in June. All right, I did not see this. Now, I already spent literally the $25,000, right? Already. I've already spent this. So, my bank account looks depleted with the $25,000 that I spent that I made in April, did not hit until June. So, that's the huge problem for indies. It's like, um we're spending the money. Now, luckily, I have enough cash flow where I don't need to worry about it, but at the same time, like if I didn't, like I'm spending I'm willing to spend money up to 13, 15, 20,000 dollars a month. Does not matter. But the fact that I have to wait so long to get my hard-earned cash is the exact problem that you might be facing. So, thank you to Adapti.finance

9:45

for coming up with this solution. Again, one thing to note is you have to have the Adapti SDK to utilize this Adapti.finance. Lastly, what I'll tell you guys is if you don't believe me, here's some case studies. Go to the website, check out the case studies. You can see Leor said, "We applied, shared our numbers, and got paid next day. New No bureaucracy, no back and forth. Easily one of the best financing experiences we've had. Adapti.finance helped us unlock our subscription revenue faster so we can invest back into proving the product and delivering a better experience for our players."

Case studies and final thoughts 10:20
10:20

Nick, I know Nick, by the way. So, there's so many great case studies out there. One that Adapti showed to that I can share, or I'll just have them on in a future podcast. It was one developer that grew from 5,000 to $80,000 in revenue in 4 weeks using Adapti.finance. Cuz once you find a channel, that is the hardest part, that's going to unlock real scalable growth for you, the hard part is getting figuring out where to get that money without taking out a loan, right? Hard way to do it without taking out a loan to fund that channel. All right. Go check out adapti.io/finance, [music] or better yet, just use one of those links that I provided for you. All right.

11:04

>> [music] >> So, guys, till next time. I'll see you on the next video.