No time to market your SaaS? Try app exchanges

"Build it and they will come."

In my research on acquisition channels, I discovered that this no longer holds true for 99 percent of channels, with the exception of app exchanges.

What are app exchanges?

The Shopify App Store. The Slack App Directory. The Salesforce App Exchange are just some examples (here's a list of 67 of them of 67 SaaS marketplaces).

Platforms such as Shopify, Salesforce, and Slack eventually grow to the point where integrations become one of the most important ways to grow.
As a result, these platforms launch app exchanges where developers can submit "plugins" that integrate with them.

Think of those "plugins" like "mini-SaaS" software, where you mix the platform's API and your own code to create something useful for the users of those platforms.

Will app exchanges get me more users on their own?

Hell yeah. I wrote a whole article where I list several examples out of the 494+ IndieHackers interviews. These are founders that had success getting traffic being listed on platforms like Shopify, the AWS Directory, Slack, Github, the Chrome Web Store and so on.

Some founders launched as a stand-alone SaaS, failed, re-launched as an app plugin and succeeded. One of them is Nelson Joyce, the founder of Tettra ($25,000/MRR), an internal knowledge base tool:

Of course another massive source of trials was the Slack App Directory. After our experience, I highly recommend launching on a platform like Slack, WordPress, or Shopify. There's a whole chunk of functionality that you can essentially "outsource" to the platform. For us, that was authentication, user management, and access to the "work graph". You also get free distribution from the parent platform and a clear target persona you can attract.

Nelson's co-founder, Andy, even wrote an article on how Slack saved their startup and why he thinks launching on a platform has more pros than cons.

The top reason for making an app exchange plugin, according to Andy, are habits:

The way people access a tool is just as important as what the tool does. People are overloaded with information, logins, and interfaces. And here we were, asking them to create a whole new habit.

After Nelson and Andy had this realization, they launched on the Slack App Directory. A year later, it's been "one of the best strategic decisions we've made as a new startup", according to them.

Why do big platforms need you more than you need them

  1. They're growing fast and investing in integrations

Take Salesforce, for example. They have 23% year-over-year growth and make $6.34 billion in revenue.

As part of their growth strategy, Salesforce invests a lot in integrations:

Salesforce’s Platform and Other unit, which includes the MuleSoft integration software and Tableau data-analytics software, delivered $1.88 billion in revenue, which was up 24%.

When a platform reaches the size of Salesforce or Shopify, integrations becomes one of their main acquisition channels.

  1. They're struggling to hire developers

This has been the case with Shopify, where "engineering hiring is probably the biggest limiter to Shopify's growth", according to Harley Finkelstein, Shopify's president.

This is one of the primary reasons why Shopify is relying on their third-party app exchange ecosystem and have recently lowered their App Store commissions to 0% for developers who made less than a million in revenue.

  1. People actually find the extensions useful

The typical merchant on Shopify uses 6 apps. Most platforms don't have official stats, but you could use your friends' circle to get a rough estimation: How many of your friends using Chrome also use extensions, for example?

Isn't there too much risk in developing on those platforms? A Case for B2B

It's completely understandable to be afraid of third-party platform risk. Especially with platforms like Twiter and Facebook constantly changing and removing features from their APIs and making it harder for developers to make third-party apps.

However, there is one pattern I've noticed... The majority of platforms that screw their developers are B2C. B2B platforms (such as Salesforce, Shopify, and Slack) are far more stable, and I've yet to see a B2B platform abandon their developers in a major way.

The reason for this: I discussed this with Justin Jackson on Clubhouse, and he provided a compelling reason: B2B platforms, unlike B2C platforms, have a plethora of use cases.
For example, the Shopify App store has over 40 categories.
In comparison, Facebook (which does not have an official third-party app exchange) has only 15 "features" as social plugins.

So when developing on a third-party platform, I'd prefer B2B over B2C.

New App Exchanges are launching all the time

They first start by opening their API and then progress to app exchanges.

Take Notion, for example, which has a beta API. Notion has been growing like crazy and I wouldn't be surprised if they launch an app exchange somewhere in late 2021 or 2022.

Another example is Bubble. The nocode movement is getting major traction in 2021 and platforms like Bubble already have marketplaces for third-party devs.

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What do you think?

What are the pros and cons of building a "mini-SaaS" on an app exchange? Let me know in the comments below.

  1. 3

    One con is the app stores themselves can be pretty limited in stats like 'number of impressions' or 'search volume' for keywords, or documentation like 'how are these apps ordered?'

    Anybody know how Slack apps are ordered in the paged list?

    1. 2

      That's true. For keyword search, I look at tools like SemRush for the relative difference and try to estimate based on that.

      Or I assume that if a keyword appears in the suggested list on an app store, it prob has more searches than a keyword that doesn't.

  2. 3

    Notion is interesting. Anyone knows of any other fast-growing platform that are releasing APIs/app plugins?

    1. 3

      Still waiting on Zoom to actually do a public release of theirs

      1. 1

        Forgot about Zoom. Thanks!

  3. 2

    Definitely the easiest if not the best way to market your product in a targetted way and opten, the users are already paying users, so, there is no need for a free plan.

    1. 1

      That's an interesting point.

  4. 2

    It works 100%. I have built okrstudio.com as Trello power up and getting 2 - 3 leads daily with zero marketing.

  5. 2

    Great post, and spot on.

    The Google Workplace Marketplace is basically the reason that BudgetSheet ( https://www.budgetsheet.net ) is successful despite very little marketing on my part.

  6. 2

    My friend did this with Semrush's marketplace. He got more customer through that - than direct signups! 100% good method to acquire customer!

      1. 1

        https://www.semrush.com/apps/ <-----! I don't wanna throw them under the bus (since it's not my company) but they're one of the top apps on there!

  7. 2

    Would you consider Apple's app store an app exchange?

    1. 2

      By this definition, yes. Although it's' probably the biggest and the most saturated one. See the list of the B2B App Exchanges above, if I would start I'd go a growing B2B App Exchange.

  8. 1

    Very true. Ride on the shoulders of giants

  9. -1

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