Your idea needs funding. Investors are looking for great ideas. How do you find investors? If funding is what’s holding you back from being an entrepreneur then read on. Raising funds to start building and marketing your mobile app is possible.
Before moving on into exploring different funding avenues, it is essential to have a recheck on your plans to becoming an app entrepreneur.
Confidence in your app idea and meticulous execution plan are essential
You should believe that your app idea is a brilliant one with the ability to attract customer satisfaction and demand. You need to have strong conviction and the will to take the idea beyond the ‘idea stage”. Drafting out proper execution plan and implementing it with the right spirit can make your app a runaway hit. Having deep and clear understanding of what your app is going to do, what problems it solves, its functionalities and features are crucial.
Let’s have a quick look at some great fund-raising paths for your app idea.
7. Self-Funding (Bootstrapping)
Self-funding is nothing but finding funds from the existing and available avenues. If you have enough money to spend on your app idea execution, make use of it without wasting time to raise investment. You can even lean on your income from existing job, personal savings etc. You need not have lavish funds on the initial app version. You may not launch a fully featured and marvellously designed app in the intial stage. You can roll out the app as a model to test the pulse of the users. The app should be loaded with the most basic and fundamental features to enable its functionalities. This skeleton version of your product, if successful, can attract investors. This will allow you to carry on with the later stages.
6. Funds from Friends and Family
Popularly known as ‘buddy funding’, funding from friends and family is yet another popular source of app funding. Your dear and near ones are the best investors, provided they have faith in you and your idea. If you are surrounded with wealthy buddies, asking a lending hand to execute your app development plan is a good idea. Since you are bringing in your close-knitted ones into the business, it is essential that you run them through a detailed discussion on the possible risks involved. This will enable you to steer clear from any bitter experiences in future.
5. Bank Loans
If you can persuade and assure banks about your app idea and its utility; banks may be willing to offer a loan to fund your app idea. Before approaching a bank, keep a scrupulously crafted business plan supported by market research and other credentials. You should do proper homework to authenticate potentiality and profitability of the business. Most of the banks would ask for a collateral security while issuing loans.
4. Partner with Co-founders
You might be ready to shell out money in making your app idea a reality from your personal savings and revenue. But you find your funds insufficient for the proper execution of the app idea. Here comes the need to find a partner to fund the app. Getting someone with whom you can share the responsibility of launching a new app lessens the risks involved and both parties could share their experiences. Parking some of your own money in your project acts as a proof that you have tremendous self-belief in your idea. Hence, finding a reliable co-founder will not be very difficult. If you manage to find a partner from the same business with the desirable skill set, it will act as an added advantage.
3. Crowd Funding
Crowd-funding is another popular and novel method followed by many startups to find finance for their app development. There are some online platforms that act as crowd-funding campaign platforms attracting attention of anyone who is ready to shell out their money. If you are lucky enough to get people talking about your app idea, your chances of getting potential investors are huge. The main advantage of this type of fund raising is that you get to taste the response of people regarding your app idea, even before the project is kick-started. AppBackr, Indiegogo, AppStori, KickStarter, etc., are some of the admired crowd-funding platforms helping app entrepreneurs to realise their dreams.
2. Get in Touch with Angel Investors (Seed Funding)
Angel investors are those who are ready to invest their money in concepts or ideas. In other words, they are willing to fund the seed (app idea) of the product (app itself). In order to make them write the cheque, they should believe in your idea and its potential for downloads and future revenue. You might need to show them a prototype of the app that you are going to make to prompt them to fund. Brush up your networking skills and get introduced to a benevolent angel investor.
1. Find Venture Capitalists
Seeking a Venture Capitalist (VC) is the traditional and well-accepted method of finding funds/finances for your app idea. Investors are different from person to person, and the criteria they look for when deciding to put their money into something are also diverse. Since the main ambition of VCs is to make profit, it is essential on the part of aspiring entrepreneurs to analyse the fundability of their app idea before reaching out to prospective investors. Sharpening your sales pitch is also of great importance. Investors are looking for ventures that exhibit highest potential for success. Therefore, convincing them about the revenue generation or takeover capability of the app (which is now in paper just as an idea) is of great significance.
Want to get more info on what investors look for while funding an app, click HERE
The need to materialize your app idea into reality is only yours. So, get set, take charge and decide on the most apt funding method that will suit your app idea.
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