Splitting The Revenue Of An App

osucowboy18 · July 2011

Hey guys,

I've got a question for those of you who split your profits for a particular app with someone else. So my graphic designer and I were thinking about making an app together and then splitting the revenue of that app. Is their some software that you guys use that will tell you how much a certain app has made over a month's time, that way you can determine how to split the profits? It seems like their has to be an easier way to keep track of that since Apple's financial reports only show revenue by country, rathe than by app. Thanks in advance.

- Alex
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jonmulcahy · July 2011

check out appannie or download appviz, they both take the data apple provides to you and correlates it.

jamesmunro2 · July 2011

The website appannie.com does a nice job with easy to read charts. I like it because anyone you work with can be given access to it to verify sales. It lists the revenue by day, week, 30 days, etc... however it does not stop at months. It is easy to determine the payouts, though. If an app over it's lifetime has made $300 you split $150. The next month if the lifetime is $400 you split $100 ($400 minus the $300 you already split).

For software, I like Applyzer. It works well.

Best of luck!

butterbean · July 2011

Appfigures is really good too. The thing with splitting revenue, is you have to be careful if you're the one paying out. Sales reports are different than fiscal reports, meaning, if you track sales through the software, they are always going to be higher than the actual monthly fiscal reports, especially towards the end of the month, when sales aren't finalized, and they roll over to the next, so there is always a discrepancy between sales reports and fiscal reports, (what apple tracks as being sold, versus the end amount you get paid)

My suggestion to you, if you're splitting revenue, to make it easy, is set up a separate account, and just split it 50/50 after you get paid, or if you're going to publish it under your account, then lower the share your giving to the artist or whomever you're doing the split with to 45% to account for the discrepancy in sales versus financials.

Hope this helps!

osucowboy18 · July 2011

Thanks for the tips everyone.

@jon & james: Does app annie give reports by app or by country. If they give reports by app, meaning how much money a certain app has made over a month, then I think that will work...correct me if I'm wrong though.

@butterbean: Good advice, if all else fails, I guess I will have to lower my artist's cut to compensate me for the discrepancy in the different reports. When you said "publish under a different account, did you mean publish under a different Apple Developer Account, or is their a way to set up a sub account under my company's name so my company name is still shown to be the "App Seller", but the profits for apps in the sub account are tracked separately then the main account. Hope that makes sense

@everyone: If you have any more advice to add, please do so.

Thanks everyone!

- Alex
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osucowboy18 · July 2011

Bumping this for those in a different time zone

- Alex

butterbean · July 2011

Hey Alex!

Not sure what you mean by setting up a "Sub-account" I know you can set things up so that if you wanted your artist to only be able to track sales, but not see the other info, you could do it that way, and they'll have reports emailed to them, and they can log in and only see sales.

What I meant was you open up an entirely new account, under a company name, and solely use that account for revenue share with an artist, but it would probably be worth it if you were going to publish multiple apps to that account.

I think the easiest and best way is to do the 55/45 agreement, where your artist gets 45% to account for the discrepancy in sales vs actual revenue.

Hope this helps!

osucowboy18 · July 2011

Thanks butterbean for the quick response and good advice. Does Apple even allow two accounts under the same company name though???

- Alex
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jamesmunro2 · July 2011

no they do not allow it.

Appannine.com reports by app and is free. If you already have apps for sale, check it out. I am sure the reports can work. It's what I use.

jamesmunro2 · July 2011

Other important factor is taxes if it sells. Whoever's name is on account will owe taxes. It probably should be figured into account. (I know it is for mine.)

butterbean · July 2011

Hey Alex,

To my knowledge, they don't. I think you have to set up a different company, or if you have an app store under your "legal name" then you could open one up a 2nd account under a Company name, or vice versa.

I think they track these through social security numbers and tax ID numbers, so you can't have multiple accounts under the same SS or Tax ID.

Hope this helps, and is not too confusing!

osucowboy18 · July 2011

@James: Ya, who's paying taxes is another issue. I believe my company is the one who will be publishing this app, so I need to talk to my accountant about this. Thanks for responding james!

osucowboy18 · July 2011

Thanks butterbean. It looks like the best way to go is a 55/45 split. Hopefully that will cover some of the tax issues as well.

jamesmunro2 · July 2011

Be careful about trying to do something with two accounts. Someone on GameSalad had two accounts. When Apple discovered it they closed the second account. There was no choice in which account remained open (If I remember correctly from the postings) and the programmer lost the AppID and Name because they cannot be reused.

osucowboy18 · July 2011

Well the primary account I use is under my company's name, PDL Productions, L.L.C.. So if I were to set up a different account, which I don''t really wanna do in the first place, it would be under my name. But, I think I'm leaning more to publishing it on my account. The only thing to really worry about is tax stuff.

heathcc · July 2011

If you are the one paying, keep in mind that Apple report your income in association with you. So your taxes owed will be for all the revenue. Sort that out with your partner(s) ahead of time because you don't want to feel shortchanged at tax time.

butterbean · July 2011

For tax purposes, whatever you're paying the graphics artist, 45% will be considered a write off, because that's payment to them. So you are not responsible for taxes for the 45% portion, since you are paying the graphics artist. Speak to an accountant about that.

By tax year end, you then have them fill in their info into a W-9 form, then send that to your accountant so he/she can send them 1099 forms, so that they pay taxes on what you paid them, so you're not liable to pay taxes on the revenue share portion. That portion you paid them will be included in your deductions just like any other item you purchase: pens, equipment etc.

Don't take my word for the above, and always ask an accountant's advice, but from my memory that's what I've done for payment to graphics artists etc. If you're ever writing something off ie: payment to graphics artist, and if it amounts over $600 in the U.S, you must have them fill in a W-9, and then the accountant sends a 1099 form their way, because that's income they received, for which they will be liable for taxes, and they will give that to their accountant to show as part of the income they've made for the tax year.

If you're going into a revenue share, make sure you talk to an accountant about it, so your graphics artist, and yourself are clear on the terms, and that they will be liable for taxes for their share.

osucowboy18 · July 2011

Thanks for the info Butterbean! I'll talk to my accountant about it. I'm sure we can work something out. So, it looks like I'll be using App Annie for the financial reports because they divide reports up by app rather than country. And then I'll just report my 55% and have my accountant deal with the forms for my graphic artist's 45%. Thanks again for the help everyone. Much appreciated

- Alex
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Splitting The Revenue Of An App

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