Today we are overloaded with stories about how startup entrepreneurs secured venture capital and soared to great wealth in a very short span of time. The capital-raising route notwithstanding, a growing number of startups are giving priority to organic growth.
Among them is GoodNotes, a Hong Kong-based tech firm that is committed to becoming profitable, first and foremost.
The company offers a note-taking and PDF annotation app with built-in handwriting recognition abilities.
Since its founding seven years ago, the firm has not relied on external capital. Instead, it is charging customers who download the app, GoodNotes founder Steven Chan told the Hong Kong Economic Journal.
The app has been downloaded over two million times since its launch, and this business model has helped him turn a one-man company into a team of five people now.
The idea for the app started in 2010, when Chan acquired an iPad which Apple introduced that year.
Using the tablet computer to take notes during class, Chan found that existing applications, such as its drawing feature, did not deliver a good experience to users.
The experience prompted Chan to work on developing his own app for note-taking using the iPad.
GoodNotes allows users to feel like they are writing on real paper, while letting them drag documents, notes, images and texts in and out of the app.
“Before Apple Pencil is launched, users would find the pen point of existing styluses too bulky to write with,” Chan said. “That’s why I added the zoom feature to enlarge items in GoodNotes.”
Chan admitted that at the time he was developing Goodnotes, his goals were not so ambitious. “We have an internal name for it, called ‘50k’, as we just targeted to make a profit of US$50,000 from the app, and once that was achieved, we would probably move on to other projects.”
Eventually, Chan and his team were astonished when the GoodNotes app became a mega-hit worldwide, resulting in a revenue of several tens of millions of dollars, although it had to give 30 percent to Apple.
Priced at US$7.99 each, GoodNotes 4, the app’s latest edition, was the fourth most downloaded paid app at Apple iOS store in Hong Kong last year.
Chan told HKEJ that the company is planning to build the app for other operating systems such as Android and Windows, while developing a new feature that allows teams to work simultaneously on shared notes.
As a long-term vision, Chan expects GoodNotes to contribute to a paperless future.
This article appeared in the Hong Kong Economic Journal on May 7
Translation by Ben Ng with additional reporting
[Chinese version 中文版]
– Contact us at [email protected]