HEADQUARTERS: Los Angeles, CA
YEAR FOUNDED: 2011
2015 REVENUE: $2.25 M
When a celebrity, public figure, or non-tech-savvy company wants to create an app, they often turn to an agency for the heavy lifting of development. Ben Lee and Drew Harding had worked at one such agency and knew all its flaws. They wanted to upend the agency model that included billing clients for time, which led to the frequent creation of feature-heavy, clunky apps.
So in 2011 they founded Neon Roots, armed with just $1,000 in its bank account and one customer. Lee admits it wasn't an instant hit. "We started doing augmented reality and virtual reality--but the customer didn't understand it yet," Lee says. "There was no Oculus Rift yet--so everyone wanted to meet us but no one wanted to pay us."
They pivoted back to an app-development agency model--but this time, they'd build in an edge. It was called "agile development," and they'd follow the new philosophy of computer-programming project management that emphasized rapid iteration and working in sprints.
By 2012, Neon Roots' app-building services were in high demand. So high that it appeared Lee needed to learn to say no. As Lee tells it, a customer with an overly broad vision for what he wanted in an app wanted to hire Neon Roots. "My partner looked at me like, let's not take this project," Lee says. Only, Lee couldn't bring himself to turn down business.
So he did what any good entrepreneur would do: Built a new product and sold that to the customer. "We charged him for this three-week discovery session, and the output was actually amazing," Lee says, referring to the consulting workshop he designed. "It resulted in a better app."
They call the new workshop product Rootstrap. It analyzes the market fit and viability of a proposed app project, and helps hone it before any costly programming begins. Neon Roots charges customers $15,000 to $40,000 for the mini idea incubator. And, according to Lee, this is on track to become the biggest revenue generator for Neon Roots.
"We've had many celebrities and investors go through the process and decide to scrap it," Lee says. "They say, you guys basically saved me a half million dollars and a year of my life."
Neon Roots has worked with more than 100 clients, and that roster includes companies such as Spotify and Epson, and figures such as Snoop Dogg, for whom they created the much-lauded cannabis-culture app Merry Jane, and author-speaker Tony Robbins.
Robbins's team went through the Rootstrap process, and also subsequently worked with the programmers at Neon Roots to develop an extensive content-library app called Breakthrough University.
"Ben is Mr. Ideas," said Kate Austin, who handles special products for Robbins Research. "He can take the most complex process and workflow and the ideas he brings to the table are absolutely amazing--things that are cutting edge and customer-oriented."
Despite that Neon Roots is itself bootstrapped, it is helping clients--an array of companies, celebrities, and individuals with ideas--scale, become booming startups. Some of them even attract venture capital investment. According to Lee, 13 percent of the startups that have gone through the Rootstrap process have attracted at least $250,000 in seed funding. Seven percent have raised $1 million or more.
And, suddenly, a little app studio is looking more like a fast-growing business incubator. No thanks to no.