How We Started A $82K/Month Custom iOS And Android Apps Development Agency

Rob Bentley

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Published: October 15th, 2020

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Rob Bentley

Founder, The Jed Mahonis Group

$80K

revenue/mo

Founders

Employees

The Jed Mahonis G...

jmg.mn

from Minneapolis, MN, USA

started March 2012

$80,000

revenue/mo

Founders

Employees

Discover what tools Rob recommends to grow your business!

platform

Linode

MailChimp

SendGrid

social media tool-icon

Instagram

Twitter

accounting tool-icon

Quickbooks

productivity tool-icon

Google Suite tool-icon

Dropbox

Slack

Trello

payments

Stripe

analytics

Google Analytics

advertising tool-icon

Google Adwords tool-icon

LinkedIn Ads

design

Sketch

podcast

Libsyn

other

StackOverflow tool-icon

Final Cut Pro X

Discover what books Rob recommends to grow your business!

Deep Work: Rules for Focused Success in a Distracted World Cal Newport

Good to Great: Why Some Companies Make the Leap and Other... Jim Collins

Turning the Flywheel: A Monograph to Accompany Good to Great Jim Collins

Want more updates on The Jed Mahonis Group? Check out these stories:

1. Update: How We Grew Our Agency To $700K/Year With A $500 Initial Investment (2022) ➜

Hello! Who are you and what business did you start?

Hi! 👋 My name is Tim Bornholdt, and I’m a co-founder of The Jed Mahonis Group. We are a custom iOS and Android app development consultancy, and we specialize in building native mobile app solutions for businesses of all sizes.

We’ve grown at a steady pace over the past eight years. We currently work with several large and small organizations including Great Clips, Profile by Sanford Health, Green Mill, and the USA CUP. My business partner and I started the company right out of college by investing $250 each and have since turned it into a nearly seven-figure a year agency.

how-we-started-a-82k-month-custom-ios-and-android-apps-development-agency

What's your backstory and how did you come up with the idea?

Growing up, I’ve always been into technology. I built my first website when I was in first grade, I built my first graphing calculator app when I was in sixth grade, and I used to run the internet’s largest website dedicated to Ralph Wiggum from The Simpsons.

I waited in line for the iPhone the day it launched in 2007, and I was instantly hooked. I knew I had to learn how to build software for this device. Eventually, I learned how to jailbreak my device which allowed me to run custom apps on it (this being before the launch of the App Store).

Even though I had a passion for technology, I never really wanted a career in it. My dream job was to work as a technical director for live television broadcasts, and the only class that was close to that at my school was the capstone course for the Professional Journalism program. I ended up switching my major from Computer Engineering to that and abandoned any dreams of professionally writing software.

I graduated from college in 2010 and did a lot of freelance video production work. I was set to accept a job at a TV station in northern Minnesota when I happened to grab lunch with one of my best friends from high school, Robert Bentley.

Rob graduated from college a few months after me with a degree in business, and he had a hunch that this “App Store” thing wasn’t going anywhere any time soon. His vision was to partner together on a business where we build iOS and Android apps. His focus would be on the business side of things and mine would be on the development side.

Being fresh out of college, we both had zero money saved up and zero contacts in the industry. The only “business” checkbox we could check was that we knew we were solving a problem people had, so we decided we could figure out the rest from there.

Because we were young and had a solid-enough support system behind us, we figured now was as good of a time as any to start a business. We each deposited $250 in a bank account and got to work learning not only how to develop apps for people, but also how to run a software development company.

Take us through the process of designing, prototyping, and manufacturing your first product.

Our first few months were, to be blunt, unproductive. We spent more time playing Super Smash Brothers on the Nintendo 64 and Bejeweled on our iPads than we did on our business.

The only photo from the day we went down to the Secretary of State’s office and officially became an LLC. The blurriness makes it even funnier

After a few weeks of that, we got off our butts and got to work. We spent quite a bit of time discussing whether we should build apps for ourselves or build apps for others. Ultimately, we decided that until we had some of our own apps in the App Store, nobody would believe we were a legitimate operation.

My business partner and I have an unstructured “walk and talk” every single day. If we’re in person, we literally go out on the trail behind our office and walk for 45 minutes, talking about anything that is on our minds.

We wrote down a list of ten or so technologies that we figured were important to have in a mobile app and decided to build concept apps to show that we knew what we were doing. The list included things like interacting with an API, sending push notifications, capturing photos with the camera, and so forth.

Our first app was called the Random Celebrity Generator (You’ll notice a theme with our own personal apps: their names are quite literal 😂). It was incredibly simple: you would tap a button and a random celebrity would appear with some basic biographical information. You can still download the app in the App Store or visit the website version today. The app showed that we knew how to store information in a database and display it on the screen, which is the core of basically any app.

A screenshot of the first version of the Random Celebrity Generator. Look at that beautiful code! rolls eyes

The next app we built was called the Half Staff App, which sends a push notification the evening before the US flag should be set to half-mast. That app still exists today and helped us figure out how to deliver push notifications.

Once we had those two apps under our belt, we began to land clients who had a variety of needs:

We built an app that used geofences to automatically put your phone on silent when you enter a church.
We built an app for auto dealers which let you automatically post a photo to Facebook of you with your new car.
We built an app for funeral directors to easily take down notes when you first receive a call upon someone’s death.

Throughout this whole period, we learned a ton about dealing with clients, the importance of a good contract, and how to communicate effectively. We certainly made mistakes, but we also wrote a lot of good code and helped solve problems for folks in a variety of industries.

Describe the process of launching the business.

“Launching the business” makes it sound like we had a grand plan, but as I’ve noted in the last section, we legitimately had no plan.

Rob (above) and me working from our first “office” (aka the basement of the duplex I was living in). Look how much hair we had!

When we put our website up, the goal was to try and become the top organic result on Google for “Minneapolis App Development Company”. Back in 2012, that wasn’t so hard to do, so we ended up climbing the charts and eventually got to the top resulting in several inquiries from various companies and entrepreneurs.

We grew into our business very slowly. Rob and I both worked additional jobs on the side and relied on our girlfriends quite a bit in the first few years of our business. Most of the money that we made went straight back into the business.

After a couple of years of making minimal and sporadic money, we set a goal to pay ourselves a consistent salary of $3,000 per month. We figured if we couldn’t even pay ourselves $3,000 a month, then we shouldn’t call ourselves business owners. We ended up achieving that goal after 4 months by setting up recurring payments with some of our clients, as well as landing a couple of larger clients with bigger projects.

Another lesson we learned: about 5 years into our business, our sales and project management process was this: whoever read the email or answered the phone first was that client’s salesperson and project manager. This meant that your experience with JMG highly depended on whether you got me or Rob.

Even though we started the business to have me do project management and Rob do sales, we found that switching roles would play better to our personal strengths. Rob is way better at digging in his heels and getting work done, and I’m way better at schmoozing clients and digging into a client’s initial problem.

Once we made this change, it began to clarify our individual missions inside the company. Rob focused all of his efforts on our project management and development process, and I focused all of my efforts on sales and marketing. I believe this single change is what led to our major growth over the past four years.

Rob and me, proudly holding up the giant Subway party sub at our very first-holiday party. We’ve since had a giant Subway party sub at every company holiday party because what kind of party doesn’t have a giant Subway party sub?

Since launch, what has worked to attract and retain customers?

Time and time again, it seems like clients come to us and stay with us because of the way we communicate and operate. Many custom software development companies will brag about how smart and great they are, and that smug attitude carries through the entire development process.

We don’t operate that way. We really pride ourselves in taking the time to get to know our clients and their business problems. We propose changes when (and only when) they make sense, not just to make us more money. When issues arise, we get on a phone call and hash things out. We truly see ourselves as partners in their business.

I know it’s not as flashy of an answer as you might be looking for, but I think it’s important to get the fundamentals right before exploring other marketing and retention options.

We’ve done a few different things on the marketing front, but the three that have worked the best for us have been launching a podcast, ranking highly on Clutch, and good ol’ fashioned SEO.

Our podcast, Constant Variables, is currently a bi-weekly look into app development but approached at a non-technical level. Our audience is folks who are not technical but have a need or desire to understand how apps work. We average about a hundred unique downloads in the first week of a new episode, and we’re quickly approaching the 10,000 downloads mark.

Clients who found us through the podcast tend to find our website first, then discover the podcast as they browse the site. In that regard, it functions more as a source of “thought leadership” than it does as a lead magnet, but hey, either way, it works!

Our SEO strategy is to write verbose, long-form blog posts about both common and obscure app development topics. These articles take a few weeks to concept, draft, and edit, but over time, we’ve ended up ranking quite high on Google for these topics, so we continue to invest our efforts into making them. The podcast and the blog tend to work interchangeably, meaning we create content for one and repurpose it for the other.

Finally, I would say our biggest lead magnet to get us to this point has been Clutch. Clutch is a directory of B2B businesses, and for some reason, they’ve always ranked high when you Google for “app development companies in Minneapolis.” In our early days, we ranked quite high on Clutch, which led to several quality leads. In recent years, the competition has become quite high amongst my peers, so we have spent less time focusing on Clutch and more on our other efforts.

How are you doing today and what does the future look like?

Given that all of us are trying to navigate through a global pandemic, we’re doing just fine. We’ve technically been profitable since we started, and we’ve been operating with a profit margin right around 20% for the past few years.

If you’re trying to be your own boss, try dipping your toe in the water first to see if you actually like being your own boss. You might be surprised at how frustrating it is to have to set your own schedule and prioritize your own workload every single day.

The biggest thing we are working on is overhauling our sales and marketing strategy. We’ve spent the last year investing in our marketing strategy, and that is slowly beginning to realize results. Sales-wise, we are planning on investing in a dedicated salesperson to help us keep our pipeline healthy.

In the short-term, we want to get through this overhaul and figure out the key to landing more of our ideal clients. We firmly believe that once we get this last piece of the puzzle figured out, we will be off to the races.

In the next five years, we want to be known as the best native iOS and Android app development company in the Twin Cities. We never want to lose our identity or compromise on our commitment to quality, so if we decide to scale past that point, we will only do so once we’re able to ensure that every customer of ours gets the best experience.

Through starting the business, have you learned anything particularly helpful or advantageous?

Literally, everything we’ve learned has been helpful, but the biggest lesson we’ve learned the hard way is to invest in people who can do things better than you can.

We tried our hand at drafting our own contracts and business agreements, but we couldn’t do that better than a lawyer.

We tried doing our own bookkeeping and taxes, but we couldn’t do that better than a bookkeeper and a CPA.

Even when it comes to our core competency (app development), my business partner and I are very good at it, but there are certainly folks who are better at it than we are, so we hire them.

On that note: one of the best things we’ve done is invest in developers who are brand new to developing. You can’t always get away with this, especially if you need something done quickly and correctly. But many of our developers were friends and acquaintances who had never written a single line of code. We spent many months and years training and teaching them how to think like a developer. This has paid off in so many unexpected ways, and I highly recommend that if you are thinking of starting an app development company, you should continually invest in junior developers.

Another major contributor to our success is that my business partner and I have an unstructured “walk and talk” every single day. If we’re in person, we literally go out on the trail behind our office and walk for 45 minutes, talking about anything that is on our minds. If we’re remote, we do it on a phone call.

There’s just something about a daily call that holds us accountable, as well as makes sure we’re always on the same page. The walking aspect seems to kick up endorphins and generally puts us in a good headspace. Even if we’re stressed out, we feel better by the end of the walk and can usually come up with better solutions as a result.

And yes, even in the winter here in Minnesota, we’ll throw our coats on and get outside for a walk. The only time we don’t is when it is actively snowing or raining, and in those cases, we just pace back and forth in the hallway outside of our office.

What platform/tools do you use for your business?

I could go into the development tools we use for our business, but because we’re a native iOS and Android development shop, we pretty much just use what Apple and Google tell us to use.

When Rob and I switched roles, we each independently and (without consulting each other) built small apps for ourselves to help manage those various aspects. Rob built a project management tool called Triangle, and I built a sales CRM called Gil. We are currently working on merging the two into a tool we call Triangil. I would generally not recommend this for companies our size, least of all because of the “cobbler’s kids have no shoes” issue. However, because we’re picky nerds, we want our tool to work exactly the way we want, so we see the investment as worthwhile.

When we’re not living in our weird self-built tools, we use fairly standard services:

Trello for project management
Bitbucket for code repository
Linode for hosting servers
Fastmail for hosting our email
Dropbox for syncing non-code files between the team
Slack for all communication (we hate email)

What have been the most influential books, podcasts, or other resources?

Book-wise, I’d say these are the biggest influencers:

Deep Work by Cal Newport. Deep Work set up our belief that you need to be proactive and give people plenty of focused space to get their work done.
Good to Great by Jim Collins. This book explains Jim’s formula for what makes a business successful. He’s since done a couple of podcast interviews that were incredible as well, and Turning the Flywheel is a great addition to the book.

Podcast-wise, I could seriously go on for hours about my favorites. Here’s a shortlist:

How I Built This with Guy Raz. I trained for an ultramarathon a few years ago, and I listened to the entire back catalog of this show. There are some insanely inspirational stories in here with some huge names. I particularly enjoyed the episodes about Compaq Computers and Atari/Chuck E. Cheese (I know, big surprise).
StartUp. This show has several interesting seasons, but the first two were especially relevant in getting our business off the ground. This is another “burn through the entire back catalog and you won’t regret it” type of show.
The Tim Ferriss Show. My wife is totally going to roll her eyes when she sees this entry. She believes that if she tells me to do something, I ignore it, but if Tim Ferriss says to do it, then I’m all over it. To her credit, she’s probably right... but I digress. Tim is an incredible interviewer and I’d suggest peeking through the archives to find someone you recognize being interviewed by him. I personally go back to the Arnold Schwarzenegger episodes fairly regularly.
Finally, I want to shout out to Dan Benjamin on the 5by5 podcast network for his old show called Grit (or Quit). I can’t find it anymore, which makes me think it was totally removed for some reason, but that show was also hugely inspirational in getting me to do my own thing. I just wish the back episodes were still available somewhere.

Advice for other entrepreneurs who want to get started or are just starting?

Entrepreneurship is not an easy career path. If you’re going to go down this road, do it for the right reasons.

If you’re trying to make money, get a “jobby” job and throw money into index funds. You can gradually grow your wealth that way without taking a huge risk.

If you’re trying to be your own boss, try dipping your toe in the water first to see if you actually like being your own boss. You might be surprised at how frustrating it is to have to set your own schedule and prioritize your own workload every single day.

I would say the best advice I can give (which is not my unique advice but great nonetheless) is that you are the sum of the 5 people you spend the most time with. Go out and meet 25 entrepreneurs. Pick their brains. Observe their habits. Figure out which 5 you gel with the best and forge long-lasting relationships with them. It’s kind of amazing how much you absorb through osmosis when you hang out with people who have already been where you want to be.

Are you looking to hire for certain positions right now?

We aren’t hiring right at this moment, but we have a fancy jobs section on our site where we post opportunities as they arise. And if you’ve got more questions about a career in app development, I’m always up for a coffee or beer or Zoom chat!

Where can we go to learn more?

The best place is the Jed Mahonis Group website, where we have a bunch of case studies and explain what we do in more detail.

The second best place is the Constant Variables podcast, especially if you’re interested in app development but the technical stuff scares you. It’s my job to make it less scary!

Finally, as I said above, I love having happy hours or coffee meetings on Zoom, so if you’re interested in app development or entrepreneurship, please reach out to me on LinkedIn (or my partner Rob) and let’s chat!