Start-ups tap into the app market

The Canvas Works was opened by Patrick Ryan 10 years ago; it was a website where people uploaded their photos and get them mounted on wood and canvas. After 6 years of such work, Patrick opened his first brick-and-mortar shop in Kinsale. But this isn’t the biggest thing he is excited about – he’s in love with the new app for his business.

Customers downloading The Canvas Works app can make a prink-worth picture right within the app. Then they need to crop and filter the picture like they do on Instagram, and choose the option they need: canvas, wood, or frame. They pay for their option using the most convenient way for them, and get the item delivered.

Ryan has first launched the app on iPhone iOS, and 1,000 people have downloaded it in a month. With such a success, he is now preparing for the launch of the application on Android devices. “iPhone apps are easier to develop but Android apps have more users worldwide,” he said. And worldwide is the key.

“The app gives me a way into the export market,” said Ryan. “Already I’m amazed at how many orders I’m getting from around the world as a result of having the app well-optimised [easily found when people search for canvas prints] in the App Store.”

Ryan already had a mobile-enabled website. “The app gives us a lovely feature where users can crop and filter their picture and then have it automatically show up as the finished article held by a human — so they can get a true sense of the dimensions,” he said. “Difficulty figuring out sizes was one of the issues we had picked up from our feedback, so the app helps us sort that.”

Its primary appeal, however, is competing internationally, and that means not just unlocking export markets. Competitors abroad started out with an app first. Only when they grew did they set up a website. “It’s a clear sign of the way in which the app economy is getting bigger if, already for some companies, a website is coming to be seen as an optional extra,” added Ryan.

Online sales contribute 70% of The Canvas Works’ revenues, with the shop accounting for 30%. Online sales are up 25% this year. “The app, which only launched a few weeks ago, contributed just a small part of that, but we see huge growth potential,” he said.

Enterprise Ireland has been delivering the message that mobile is going to change the world for the past few years, said Ruairi O’hAilin, a technologist at the state body.

“It’s no longer hype, it’s a given for large tech companies. Yet it hasn’t really hit the mainstream. A business’s discovery these days is very often made in the App Store.”

The house-cleaning services app Hassle, a UK company co-founded by Kildare native Jules Coleman, was last year sold to a German rival in a deal reportedly worth €32m.

It provides an online marketplace that matches time-poor working professionals with local, trusted and fully vetted home cleaners, similar to the way the Hailo app matches taxi drivers with passengers.

Another “on demand” app, Handy, a platform for connecting handyman-type services with householders, was set up by entrepreneur Oisin Hanrahan in 2012. Last year, it raised $50m (€45m) in investment funding.

The Athlone-based Townapps, which creates information apps for towns across Ireland, the UK and North America, recently launched Mobility Mojo. It provides disabled people with information about parking and accessibility in relation to hotels, restaurants and attractions.

For Garrett Flower, co-owner of Krust Bakery in Dublin, which specialises in tangible treats such as doughnuts and cronuts (a doughnut-croissant combo), the idea for a new app came when he bought himself his first car last September. “I went to a party in Ranelagh, drove around for 25 minutes looking for a parking space and immediately regretted having brought the car,” said Flower.

It provided the inspiration for ParkPnP. The app allows people with empty driveways to rent them out to those in search of a parking space, in much the same way as people rent out rooms through Airbnb.

“Owners of the parking spaces decide the rate, the times and whether to rent by the hour, day or month,” said Flower, who has secured matched funding of €250,000 from Enterprise Ireland.

ParkPnP currently has 1,000 parking spaces in Dublin, the vast majority of which are owned by existing commercial car parks, who use the app to deliver special rates to users at times of low capacity. He also has 50 residential spaces, for which owners charge between €2 and €5 an hour, or up to between €100 to €200 a month. Having proven the model, the plan is to provide a similar service in other cities both at home and abroad.

Krust is about to launch its own app, enabling corporate customers, in particular, to order and pay for coffee, sandwiches and platters. “Everyone wants to get as close to their customers as possible, and an app lets you do that,” said Flower.

Traditionally, demand for app development came from businesses, such as Krust or The Canvas Works, looking to add an additional sales channel. App developers are now seeing growing interest in standalone app businesses.

“We get two calls a day from people who want to build a marketplace- style app businesses, like Hailo,” said Dermot Daly of Tapadoo, an app development company.

Daly points out that Hailo spent a significant amount recruiting taxi drivers, who were attracted to an app that enabled them to take credit or debit card payments. “You can only start building a market on the consumer side when you have built up a critical mass on the service provider side,” he said. “Who wants a taxi app with only a few taxis on it?”

The broker-type model is a tricky one to pull off. “You need a hook to get started on the supplier side and to market to the public, you need a truckload of cash,” added Daly.

Conor Wilson and Pat McKenna launched Sproose, their app-based laundry and dry cleaning business, in Dublin last November. It recently raised €30,000 in equity funding from Dragons’ Den star and telecoms entrepreneur Eleanor McEvoy.

“We’re now looking to scale up the business and expand into other cities,” said Wilson.

The business model outsources the service element to industrial laundry and dry cleaning companies, while pushing the app out via office block concierges and the human resources departments of large companies.

Users get the benefit of convenience, while laundry partners win online business without having to invest in app technology themselves.

“Laundry is not cool, but young people want cool,” said Wilson.

“They also want to pay through apps because cash doesn’t appeal to them, yet laundry is pretty much still a cash business.”

Previous laundry and dry cleaning apps simply listed the prices of competing laundries side by side, “which the laundries don’t like”.

With more than 500 active users on board already, he’s hoping to follow in the footsteps of US laundry app Washio, which has raised more than $10m in funding, including from celebrity investors such as actor Ashton Kutcher.

Wilson is concentrating on growing the business through mobile phone app rather than traditional website.

“Once a person has your app on their phone it’s a constant reminder of your company,” he said. “You just don’t get that with a website.”