How Setapp's app service is building value for developers and users

MacPaw's Setapp treats its developers well. In turn, that generates more software for the service as additional developers sign on -- and that's good for users. Here's how Setapp works for everyone.

For users, Setapp is like a huge storefront where they've already bought every app. Whether it's an app they'll use every minute of every day, or it's a tool they need once a year, being a Setapp subscriber means they have access to it all.

With over 240 apps and counting, Setapp has an app for just about everything a Mac user could need -- and now an increasing number for iOS, too. For subscribers, the whole experience is this frictionless way to try out an app on a whim, or explore apps without any trial conditions.

For developers, it's just as frictionless, and with less fuss and far less difficulty than setting up their own payment systems, Setapp brings them a whole community of users.

Creating a market for app developers

"Setapp made it easy," David Dudok de Wit, product lead and co-founder of TripMode, told AppleInsider. "They provided a turnkey solution: taking care of the payments, account management, content marketing, update mechanism, helpful support, and much more."

Dudok de Wit says he was particularly pleased to join Setapp because at the time, very shortly after Setapp's launch, App Store conditions were preventing him putting TripMode for sale via Apple.

It was the same for Luke Oslizlo, developer and co-founder of CleanShot X. "Our apps are not in Mac App Store mostly due to technical limitations," says Oslizlo. "We would not be able to include all features in the App Store version."

CleanShot X is screen capture tool, where TripMode provides extensive control over a Mac's data usage. To provide their functions, CleanShot X must be able to record everything on screen, while TripMode must monitor all network traffic.

They do so to bring clear benefits to users -- TripMode buyers on low data plans can control that network traffic -- but Apple was rejecting all such low-level monitoring.

That's now changed to a degree and TripMode is on the Mac App Store. For a time, though, it meant CleanShot X and TripMode could really only be sold and promoted on their own websites. They could solely be promoted by each company's own efforts.

So MacPaw launching Setapp in 2017 was "perfect timing," says Dudok de Wit, bringing TripMode to a wide audience. That included users who had never considered data usage, plus experienced Mac owners who were well aware of the need TripMode addressed.

"Best of all, it's a premium platform which unlocks access to many Mac power users," says Dudok de Wit.

The wide array of apps on Setapp obviously attracts consumers, but it attracts everyone from casual Mac users, to power ones. It brought new users to TripMode, and to all its app developers, plus it also took on the whole and costly backend payment processing.

"For new developers who are yet to start selling their apps, this might be the easiest way to start," says Oslizlo.

"It was as easy as drag and drop," says Dudok de Wit. "Experimenting with subscriptions ourselves at that time would've been hard."

How developers work with Setapp

Setapp does not allow every app in, even if technically they comply with Apple rules or Mac standards. Apps have to be of particular use, to serve clear needs.

Once they do, however, every app and every developer goes through the same steps to join the service -- and every one of them gets the same deal from Setapp. They are paid a portion of users' Setapp subscription fee based solely on how much their apps are used.

Some apps are going to be used all day, every day, where others might just solve a problem once a month -- but that solution is immensely important to the user. As long as an app is launched even once in the month, the developer will earn revenue.

In practice, it means that developers can expect roughly consistent use of their apps. That in turn means that developers can also count on regular income.

"Currently Setapp represents a good, stable part of our overall revenue (about 1/5th), in addition to Mac App Store and direct sales revenue," says Dudok de Wit.

"In our case Setapp provides regular and steadily growing recurring revenue," agrees Oslizlo, "as the number of CleanShot users in the store keeps growing as well."

Removing limitations

Setapp doesn't prevent any developer from selling through any other means. There is no exclusivity, no demand for separate deals, any developer can sell anywhere else, right alongside being in Setapp.

"The thing we weren't sure before joining is if it would cannibalize our sales," says Dudok de Wit. "It didn't. We realized that offering choice benefits different users with different needs."

It also means being able to offer users a choice on the developer's own website. Setapp pays an affiliate fee for users who come through a developer's site. So as well as presenting users with all the options, developers are also able to add to their income by promoting the fact that their apps are in Setapp.

"We also link to Setapp on our website," explains Oslizlo. "When you scroll down a bit on the buy page, you will see that there are discounts offered and a Setapp banner. We're using our Setapp Partner link, which gives us an additional revenue from referred customers."

The result of developers promoting Setapp and Setapp promoting apps, is that there is a community of users and one of developers, too. Just as much as being a consistent revenue source, the Setapp experience has taught developers like Dudok de Wit lessons that they have then put into practice outside the service.

"That insight helped us decide to launch TripMode subscriptions on the Mac App Store," says Dudok de Wit.

The future of App Stores

Apple is under pressure to open up its App Store to alternatives, and if it does, those alternatives would benefit by copying what Setapp is already doing. Right now, Setapp offers a collection of iOS apps alongside its Mac ones.

Those apps have to be in Apple's App Store, and they are not provided to users through any kind of sideloading. Instead, if a Setapp user chooses a Mac app that has an iOS equivalent, they can download that as usual -- but then also unlock it.

Rather than requiring users to have to separately pay for an iOS app, developers can give them full access, without any trial or extra in-app purchase requirement, through Setapp.

"Everyone wins: users, Setapp, and us," says TripMode's Dudok de Wit. "Setapp offers a great user experience, and are great partners to work with. That's something Apple could take inspiration from."