Reaching one million registered users is an important milestone for any startup. At the very least, it suggests that it is pointed in the right direction. Evernote, the app which helps you remember things you find on the Web or take photos of with your phone, just hit one million registered users a couple days ago, about a year after its public launch in June, 2008 and six months after it reached 500,000 registered users. The company raised $4.5 million at the end of last year.
Evernote’s growth is not rocket-like by any means, but it is steady and consistent. CEO Phil Libin shared some detailed stats on Evernote’s progress. You might know Evernote from its iPhone app, which won a Crunchie award and has been downloaded around one million times on its own. But the company also has Windows, and Mac clients, as well as a Web browser version. The breakdown by users is 36 percent on the Windows client (which is what Evernote launched first), 28 percent on the Mac, 20 percent on the iPhone, 11 percent on the Web, 2 percent on the Blackberry, and 1 percent on other mobile devices.
The desktop clients have been download about 1.7 million times and can be used in conjunction with the iPhone app. These numbers are instructive because the number of downloads (2.7 million total across all platforms) does not equal the number of registered users (1 million). So the next time a startup is touting how many downloads it has, cut that number by one half to one third just to get to signups.
Then you have to cut by another third. Registered users are great, but how many are actually active? Those are a company’s real users. Over the past 30 days, Evernote is tracking at about 360,000 active users, or a little more than a third of registered users. Evernote’s active users might be relatively small, but they are pretty active. Over the past year or so, they’ve created 36 million notes, or about 100 notes each. Notes can come in the form of Web clips (38 percent), text notes (35 percent), photos (17.5 percent), PDF documents (6 percent), voice notes (1.5 percent), digital ink (0.67 percent), and more.
The more active users Evernote gets, the more it can convert into paying premium subscribers. Premium subscribers get more storage, more support, more security, and no ads for $5 a month or $45 a year. Evernote has 13,755 paying premium subscribers, which comes out to about a 3.75 percent conversion rate. Both the number of premium accounts and the conversion rate is growing. Surprisingly, 82 percent of the premium subscribers opt for an annual account. That comes to an annual revenue run-rate of about $650,000, which is not much, but Evernote has other sources of revenues and Libin says he is ahead of estimates to become profitable. He just needs to get those premium subscriber numbers up a bit. If he can get premium subscribers up to 50,000, that would translate to about $2.2 million in revenues, 100,000 premium subscribers would bring in $4.5 million, and so on (I just used the $45 annual fee to calculate those numbers. Working in the monthly subscribers lifts the total a bit).
Now, if Evernote could ever get to one million paying subscribers, that would be a decent business.