Former Outfit7 CEO goes for a Groupon-for-apps model with new startup Iddiction

By Kim-Mai Cutler Comment

Iddiction, the company from former Outfit7 chief executive Andrej Nabergoj, is going after a “Groupon for apps” model with daily deals on both free and paid apps. It’s launching today with a first product App-o-Day, which offers paid apps that will go for free for a limited time, or free apps with deals on their virtual currency.

Now one might ask, why is it necessary to raise $3.5 million for what looks like a free-app-a-day service when there are already many providers in the market?

“We didn’t want to do a free-app-a-day clone,” Nabergoj said. “We wanted to create something that would bring the deal mechanic to the app store. When you look at most of these services, they’re not of high quality. They’re badly designed, poorly engineered and don’t always perform well for the developer.”

On the back-end, he said there are analytics that should help developers understand how the promotions are benefiting them. He said that his team studied the Groupon model and is looking at partnerships with many content sites to drive additional traffic.

Plus, he said his app is more thoughtfully designed than competitors in the marketplace.

“We just hope we did a really amazing job in creating the best possible user interface,” he said. “We thought: how would Apple do it? What would be the design principles they would use?”

Part of the funding, as you might expect, is going to go toward promoting App-o-Day in the iTunes store. Nabergoj won’t charge developers who want promote their apps for awhile, he said.

Last November, the company said it raised $3.5 million from Playdom co-founder Rick Thompson, Comcast Ventures, Highland Capital Partners, IDG Ventures, Felicis Ventures, Bayview Capital (which founded Gameview Studios) and Francisco Larrain, who is a director of engineering at Groupon.

Nabergoj used to be chief executive officer of Outfit7, the Slovenian developer behind the talking animal and character apps that has seen more than 300 million downloads. What we had heard at the time was that there was a split between the team back in Slovenia, which was hesitant to raise venture funding, and Nabergoj, who wanted to use funding to step on the gas pedal. In any case, Outfit7 brought on a new executive chairman and continues to grow.