Million Labs helps founders to deliver successful no code MVP apps through its No-code Bootcamps, and its founders Simon Jenner and Joff Walters estimate that using no code can cut the average cost of delivering an application from $75,000 to $7,500, and the time it takes to launch a business to around three months. Understandably, the no-code revolution is booming.
Essentially no-code enables anyone, regardless of their level of expertise, to produce an application or a piece of software that is so good that the average user coming to it cannot tell whether or not it was written in code.
Simon commented: “No code has been around for ages – we’ve been able to drag-and-drop etc, and we’ve got things like Squarespace, Wicks etc which allow us to create websites in a no code environment. However, this year has been a turning point. We’ve seen about $1bn of investment go into no code platforms such as Google Sheets and Amazon Honeycode - which was launched back in August - so it’s really starting to take off.”
Indeed, Joff mentioned that no code platforms such as Bubble; Uncork; AppGyver; Bryter; Jiffy; Appway have all received around £30m of investment, despite not being around for very long, highlighting the pace at which the sector appears to be moving.
As for Million Labs and Joff and Simon’s journey in no code, it began just over two years ago. Joff picks up the story: “We decided to take a look at no code as a coming wave of technology back in 2018. As they would say in an American cop show, we bust ourselves back down to traffic, and decided that the best way for us to understand people using no code was to dive right in and join them.”
This entailed the pair teaching themselves how to build software with no code platforms and working with founders that wanted to build their startup with no code, which in turn gave birth to the first no code bootcamps.
“I don’t think we could have predicted what was going to happen,” Joff added. “But in 2019 no code started to inflect. Bubble for example, which had been around for around six years, doubled in size almost overnight.”
The pair began to see investment on a grand scale as people migrated towards no code in huge volumes - the Reddit no code group was doubling in size every week. It was at around the same time that we were broadsided by COVID-19, so thousands of people found themselves sat at home with nothing to do, were furloughed or had been made redundant.
Therefore, ideas that had been filed away were dusted off and revisited, as all of sudden people had time on their hands, while also considering alternative career avenues. As such, people began searching for ways in which to build their startup and began to discover no code.
“It was like two tidal waves,” Joff added. “To put into perspective how busy we’ve been as a result of no code, I would say we are the largest UK no code company. A normal agency that is building software in might see 20 app builds in a year. We get 100 enquiries a month at the moment, and that’s increasing by a factor of about 50% every month. No code has just gone bonkers, and we have found ourselves in the middle of it.”
Joff added that the secret sauce of the no code boom is a combination of speed and cost. It was mentioned earlier the cost of an average application built using the traditional method, which could take a startup 18 valuable months to get live. “A no code startup would cost around $7,000 to build and take about 16 weeks to reach revenue. So, no code is increasing the speed and reducing the cost of building things by a factor of ten.”
Like many emerging technologies or infrastructures, Simon explained that it’s the nation’s startup founders who are leading the no code vanguard. This is because startup companies tend to be less risk averse and are more flexible in terms of pivoting down a different path or trying something different. Obviously, startups are also more cost sensitive as they have lower budgets, and as such, no code is an attractive proposition.
Simon continued: “We have seen a wave of founders presented with the choice of trying to raise $75,000 to get a mobile or web app built, or to just no code it themselves – which can literally be done for $100.” Therefore, is understandable the rate at which no code is taking off within the startups ecosystem.
However, SMEs too are jumping aboard the no code bandwagon. They are recognising that no code is a great tool for the many regular, mundane business tasks that they have traditionally been grinding their way through using spreadsheets. No code can bring many of these disparate elements together and put all the data in one place.
Approximately 20% of the requests Million Labs receive come from existing businesses that are trying to solve an internal problem by developing software. “A small to medium enterprise that wanted to do that previously was looking at a £50,000 cost,” Joff added. “That’s too much for SMEs to spend on a piece of software that might not solve their problem.”
Perhaps predictably, Simon explained that the slower adopters of no code have been the larger corporate enterprises, due to them being inherently more risk averse. However, the landscape is shifting, and these types of organisation are beginning to dip their toe in the no code water, adopting it for practices such as prototyping and innovation projects.
For any larger enterprise still questioning the use of no code Joff had this to say: “We’ve just delivered in three months a project for the second largest technology company in the world. Their product manager asked us, ‘how the hell did you do this with two developers in three months, when we can’t even get an API built with the entire division in the same time?’”
Software for all manner of tasks is now being replaced by no code, to the point where Joff predicts that a time will come where a no code platform of some description will be as common on our desktops as Word or PowerPoint. “We’re increasingly going to see this happening,” he added. “We used to say software was eating the world, now no code is eating software, so we can see which way we are heading.”
A side effect of no code is it is opening up the possibilities for projects that would have been cost prohibitive to justify. If a project previously required £1m to get off the ground, then it tended to only be the ones that would justify that level of investment that would end up securing it. This meant that the projects targeting huge returns and were aimed at world domination would be at an advantage. “Every pitch I saw going back two or three years had to start with ‘we are the Uber of…,’” added Joff.
Now, because no code has drastically reduced, and to some degree eliminated, the cost of building the technology, the investment playing field has been levelled somewhat and the projects that can now be brought to market are myriad and far more diverse. Importantly, smaller niche groups are much more likely to secure investment (because no code means they don’t need as much), and have their turn at bat. Joff added: “What we’re seeing in the fundamentals of people that come to us is that they are not trying to build a product that services everyone, but are building a product that services firemen or breastfeeding mothers for example, or any other small group.”
This means that rather than technology and investment being solely ploughed into the ‘next big thing’, it is becoming far more integral to the smaller business landscape which is now beginning to get a slice of the pie. Founders are now building digital SMEs, which is great news as 95% of the trade in this country and two thirds of the non-public sector jobs are in small to medium enterprises.
“As a result of COVID, small to medium enterprises are suffering terribly,” Joff continued. “It’s where people are losing their jobs. So, I love the fact that we’re now seeing startups being built for the equivalent cost of a NatWest small business loan.”
The fact that startups can now be built at a fraction of what it used to cost, the sector is seeing a massive diversity of companies. Not only that but previously, if an individual wanted to develop code, they had be prepared to self-teach over a very long period of time, or alternatively, would have to go to university or do a lengthy course – which incurs costs and takes time. Therefore, for the average person, coding always had barriers to entry.
“Now, anyone with a laptop can learn to build applications and software - and they can do it themselves in less than 100 hours. That means that we are working with a diverse range of communities from all over the world,” Joff continued.
“It is proper democratisation and diversity. Instead of trying to sponsor people into doing stuff, it’s just happening naturally because every barrier is being removed. Those people are either building their own startup company, or they are people who are finishing learning how to no code and are going straight into doing it for other people, as demand is currently outstripping supply massively. No coders are earning between £50 and £100 an hour - we always say that failed founders become freelancers!”
No code is bringing about a massive change in the world of startups. Million Labs invest into no code businesses themselves, and also run a small Angel syndicate specifically for no code startups. The changes brought about in 2020, some due to the coronavirus pandemic, has seen a halving in seed and A round investment.
“That might increase again, but for the time being it’s going to remove the oil from the engine,” added Simon, “so we’re going to see innovation start to slow down.”
He explained that a typical VC today will see around 360 startups a year and invest into just four. Therefore, most VC time is spent filtering, and most investors will say that the issue is not deal flow but the quality of that deal flow.
Most VCs operate on a artists and repertoire (A&R) model used by record companies, who will go looking for the one band or artist that’s going to make the label. Similarly, VCs are looking for one or two gold nuggets - the YouTube’s or Dropbox’s, etc. that will return the investment with considerable interest.
However, no code now means that startups can get to market significantly quicker and for less cost than they could before. So, what does a VC do when they’ve got 360,000 startups to filter through in a year rather than 360?
“What you’ll find as we move forward,” added Simon, “is rather than people doing the rounds with a pitch deck, and asking for investment to build their startup, they will have already built it, have a minimum viable product in the market, and revenue generating customers already on board.”
This in turn means that the job of a VC just got a lot harder. In the future, startups are going to be much further along their journey before they end up approaching a VC for investment. As such, the VCs themselves are going to have to adapt, and this massive volume of startup companies that are going to be entering the ecosystem is going to mean a complete change in the process – and it’s something they have not quite caught onto yet.
Simon added: “The model has got to move more towards the way that banking works with regards to loans, etc, where it becomes a very data driven. You look at the startup, apply a whole bunch of data, extract that data, and only invest when the right triggers are hit. VCs will probably be investing smaller amounts but at larger volumes, and that’s a complete change to the way investors look at the deal flow now. Self-service, high volume is going to be the future of venture capital, particularly when no code really starts to take hold, and certainly in seed and Series A funding.”
Joff pointed out that there are clearly things that currently, no code cannot do, such as advanced graphical interfaces, video or audio editors. The technology is not quite there yet – although it is on the way. What no code does do is sweep up the bottom 70% of all projects that currently use code - mobile and web applications, two-sided marketplaces and social network models, etc.
He continued: “People are delivering these types of applications in no code for less than $10,000. And so, for anybody that is involved in writing code, the reality is that they are going to get a huge part of their dinner eaten. The same is true for integrators who make their money out of things which no code has just made much faster and more efficient.
“When something is faster, and therefore cheaper, that’s the route that people will go down when making their purchasing decisions. Code will always exist, but it will be pushed to the premium and to the periphery. It will still be a massive market, but it will be much smaller than it is today.
“We are on the threshold of the no code revolution. And we’re happy to help, educate, and show people. We have a team which can build software or bootcamps where we teach people to build it themselves. Alternatively, you can just go onto the internet and search for a no code list and see all the tools that are out there to help you - it’s a do it yourself paradigm.”
Joff confessed that he doesn’t expect to be doing the same thing in two to three years. No code will become common place, its use will be ubiquitous, and no code programmes will be as common on desktops as Word or Excel. “We can’t predict what people are going to build with no code, its impact on businesses or the economy. But what we do know is that nobody pays anybody to operate PowerPoint for them, so we will have gone,” he continued.
Having said that, he concluded that it’s not too late to join this party. As previously muted, we are at the threshold of the no code revolution and it’s just about to happen in earnest. Joff highlighted the lack of attendance at the premium no code conference that Million Labs recently attended, so it is still currently a relatively small market. Despite this the range of applications for no code is limitless and it won’t stay a secret for long. So, all aboard the no code bus.