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Design and development shop IconFactory sells several apps – and AI is partially responsible

TechBrunchBy TechBrunchJuly 31, 20255 Mins Read
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At one point, an app called Twitterrific was one of the most popular iPhone apps for browsing Twitter. These days, the company behind that app and many of the apps have struggled. And AI may be partially responsible.

On Wednesday, the company known as IconFactory admitted it was at an intersection and sold several apps due to lack of resources. The announcement positioned the issue as a situation where IconFactory's app catalog has grown to include too many apps to keep up, and doesn't have enough time to do so, but the reality is that today's business has no choice but to focus on apps that offer better return on investment.

As IconFactory co-founder Ged Maheux says, side products can no longer be sustained, even if “there are many happy and loyal customers.”

The company says it will continue to work with apps like Tapestry, Linea Sketch, Wallaroo and TOT, as well as new projects that include retro pixel portraits, but it has accepted “serious offers” for other apps. These sales include intellectual property and source code.

What's particularly interesting is that it points out that the company has a major impact on the business as a reason.

“CHATGPT and other AI services are basically killing @IconFactory. I'm not exaggerating or exaggerating,” Sean Heber, developer of IconFactory, said in a Mastodon post earlier this month.

The question isn't that people use AI instead of mobile apps, but how vibe coding affects the need for app design companies like them. In addition to building their own apps, ICONFactory generated revenue by providing app design services including icon design (name), app design, marketing asset creation, branding and consulting services.

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These services have helped to promote businesses that are currently being disrupted by AI. “What I say is that I won't let anyone take it to stop using ChatGPT and generate new app icons in five minutes for an app that wrote ChatGPT in just a few hours, but I don't know what to do about the rest of us making enough money.”

Another issue for IconFactory's longtime app maker was the shutdown of Twitterrific, the most popular app, in which the company (now known as X) officially banned all third-party clients when it was killed by Elon Musk in 2023. The move led to Twitterrific, Tweetbot and other apps going out almost instantly, and IconFactory appealed to users to help them float by refusing to refund their App Store.

That too has an impact on the future of IconFactory, Heber admitted in his post.

“First Twitter/Elon designed the revenues of the main apps that were kept lights on around here, and generative AI exploded and took a final blow,” he wrote. “I think it's because I have the impression that someone with a very good design is pretty good, someone with a pretty good design, sitting here in some huge powers with money and stuff.

After shutting down Twitterrific, IconFactory turned to the open social web as a way to generate new revenue streams. I've started an app called Tapestry. This allows users to track sources across the open web, including RSS feeds, YouTube, Bluesky, podcasts, Mastodon, Reddit, Tumblr, Micro.Blog, and more. The app offers a variety of clever tools to organize your sources, create feeds and mute and hide content you don't want to see. It also provided a way for third-party developers to extend their tapestry using an add-on called connectors, allowing users to add more open feeds.

The app will continue to be part of the company's efforts for now – the Mac app is working – but even in its future it could be uncertain. For one thing, open social media platforms like Mastodon and Bluesky are still war-held by the tech giants. In other words, consumer demand like Tapestry is quite niche.

As Heber shared, the app Kickstarter was like “Hail Mary” on the company's side, but it doesn't subscribe enough people to compensate for the revenue Twitterrific has ever produced.

If AI continues to continue its app creation business, IconFactory doesn't just suffer from consequences. However, vibe-coded apps are not necessarily what consumers need because of the lack of human input, as well as the LAX security that some of these apps provide.

Reaching for the comment, Maheux agreed that AI “definitely placed the damper on the design side of the service,” but has not yet “killed” the company.

“Many indie developers employ AI for cheap or free solutions for graphical work like app icons. This is the core part of the services we offer. Of course, the frequency of developers that come to us for these services has dropped significantly over the last few years,” he told TechCrunch via email.

He also cited other factors that affect the business, such as SF Symbol, an Apple graphical system that developers can use instead. Consumers are tired of all subscriptions. He further notes that while all costs have increased over the years, there is no cost for the app, making it difficult to make a living as a small business developer.

“We had to expand our offering to other areas such as UX consulting, coding consulting, side revenue services, and more, in order to compensate for the revenue from this lost design work. Apple's introduction of Liquid Glass offers new opportunities for design work and consultation, and has worked with a handful of companies on this.

Updated after publication in company comments.



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