This post is part of the transparency series
Last Month's Recap was fairly uneventful due to extremely low app usage during the holiday season. Thankfully, usage is back up this month and things are looking great! Insomnia crossed last month's failed goal of $100 MRR and also surpassed 3,000 daily active users.
Inspired by the last Indie Hackers Month in Review, I decided to throw in a few more metrics into this post, making it longer than usual. Let me know if you like it more or less.
I also added a Transparency Page if you want to follow progress throughout the month.
As an attempt to provide more high-level context for how Insomnia is doing, I put together a list of high-level metrics that I'll be covering from now on.
|Metric||Value This Month||Change||Reaction|
|Active App Users||16,131||+27%||😀|
|New App Users||7,539||+40%||😀|
|Monthly Recurring Revenue||$110||+140%||😀|
|New Trial Customers||146||+200%||😀|
|New Paying Customers||11||+57%||😀|
|Trial Conversion Rate||8%||-2%||😕|
I also decided to move the wins/losses section here too. Here are a few of the most notable events that happened.
- WIN: Passed $100 MRR
- WIN: First paying team on board
- WIN: On deck for an Indie Hackers interview
- WIN: Dave Chaney tweeted about Insomnia
- WIN: Added New Relic and fixed performance problems
- WIN: Insomnia is being talked about more on Twitter
- WIN: Launched app themes
- WIN: Revised pricing page
- LOSS: Spent too much time fighting with bugs
- LOSS: No marketing efforts made
App Usage Growth
App usage picked up a lot since the holiday season ended. Insomnia crossed 3,000 daily active users – which is an arbitrary vanity metric – and it's awesome to see the user base continue to grow organically with almost no PR and marketing efforts. With that being said, spending more effort on PR and marketing would probably go a long way.
To give a more visual representation to this growth, here is the daily active users chart.
I've always shared MRR numbers in previous recaps, but have neglected to mention actual recognized revenue (the money that hits the bank). In most subscription businesses these numbers are fairly similar, but due to Insomnia's option of annual billing (instead of monthly), recognized revenue is much higher than MRR. Because of this, I'll start covering both numbers from now on.
Insomnia earned $390 in January, which is $280 (woah!) more than MRR. This is because 45% of customers subscribe to annual billing. This is huge when thinking about sustainability!
If this high proportion of annual subscribers continues, it will greatly decrease the time it takes to become sustainable. So, if you're thinking of subscribing, save the 16% and choose the annual plan. 😊
Alright, enough talk about actual revenue. Let's continue the monthly tradition of examining MRR growth. Here's an impressive hockey-stick-shaped chart for your viewing pleasure.
MRR is now up to $110, which is 140% growth over last month. Since the number of paying customers is still extremely low (23), this growth rate doesn't really mean anything. It's actually about four times higher than it should be.
Assuming the user demographic doesn't change and the proportion of upgrading users remains constant, MRR growth should match user base growth, which has historically been between 20-30% per month. MRR growth should eventually settle down to a similar rate.
Will Insomnia Succeed?
The MRR goal for sustainability is $5000. Hitting this number would mean being able to sustain my current lifestyle. In December's recap I mentioned MRR would need to grow 50% for 12 months to reach $5000, but that calculation didn't take into account the added runway that incoming revenue would provide. So I wrote a small script to calculate a more accurate projection.
After running the numbers, the lowest MRR growth that will eventually lead to sustainability is 25%. This is currently less than the user base growth rate, which makes sustainability plausible. However, I would prefer to tread with my whole head out of water, instead of just my nose.
I took some time last week to make a long-term roadmap. While I don't believe the resulting road map is useful, the process helped me pin down the highest priority items to work on next. Here's what I want to have done by the end of February.
- $150 MRR (50% growth)
- 4,000 Daily Active Users
- Finish first version of plugin system
- Contact 25 publications/blogs/sites for plugins PR
- Open-source the Insomnia networking backend
- Add "offboarding" survey to better understand trial user churn
I felt really good throughout most of January. The community around Insomnia is really beginning to evolve, which is both awesome and humbling. This has been my primary source of motivation.
Right now it feels like Insomnia is at a turning point. The app is now good enough to satisfy most user's needs, and is stable enough to start building the next big thing. At this point, I'm also more confident than ever that – if I can improve customer conversion rates and do more PR and marketing – Insomnia will be able to reach sustainability.
I hope you enjoyed reading January's recap. It takes about a day to write one of these, but the process helps me stay on track and keep focused on the end goal. I've also had a few conversations spawned from the things I've discussed, which is awesome to see.
As always, let me know if you have any feedback or thoughts, and enjoy the app!