Finding the right app investors is among the biggest challenge for many individuals and businesses. Yes, you may have a perfect idea that is bound to be successful. However, without funds to create, market, and roll it out, the app will just remain an idea. You may be lucky to find an investor who will support you financially. However, he/she may not share similar views with you. They may want to take shortcuts, change some things, or want to be in full control. You may also be unable to get funding for the app because you have poor pitching skills. This leaves many potential investors not convinced or a little scared.
These issues will defiantly have a negative impact on development. Unfortunately, many app developers are not aware of the obstacles they are likely to face, they will begin searching for funding before undertaking research, talking to other developers, or even getting in touch with a company that develops apps. When searching for funding or an investor, you should have the following things in mind:
Understand the investment basics
Many people rush to contact investors before understanding the world of app investors. They are clueless or have little knowledge about the different types of investment options, types of investors, current market strategies and much more. Not knowing the difference between full funding or partial funding, margins and markups, angel investors and venture capitalists, partners and investors will hinder your success.
Other terminologies include Self-Funding, Seed Capital, and Return on Investments (ROI). It pays to do research about the different investors, talking to other app developers to know whom they talked to and the avenues they used. The more knowledge you have in this field the easier it will be for you to identify potential inventors.
Ascertain the stage you are at
To increase the odds of getting funding for the app in a shorter time and putting the least effort, you should know the current development stage of your app. Are you at the initial strategy where you will need people to collaborate with your startup or are you in the 2nd stage after you managed to raise the funds to initiate app development? Do you want money for a completely new idea or it is to expand an already existing app?
Knowing the stage you are it helps to create a good strategy to pitch to your app investors. It is usually hard to get funding for a new idea. Many people prefer self-funding in what is known as the First stage. The 2nd Stage normally involves family, friends, and relatives. It will help to continue the development of the app. You will also come across terminologies like Growth, Mezzanine, and Expansion.
Learn about the investor market
App development is taking the world by storm. It is becoming necessary for most businesses to rely on an app. It may be a shopping app, money app, location app, or any other. Just like the app world, the investment scene is changing. The kind of partners and investors in the market are also changing. For instance, crowdfunding may seem to be a better option than approaching a private investor at some point and in another time, the opposite will be a better option.
Some app investors may not be willing to finance a startup but will be willing to consider a person or business that is halfway in the process. Knowing the market will help you pick the best options, which will usually be trending. It also saves you from wasting too much time and effort on unfruitful ventures.
App Marketing Companies
Did you know that app marketing companies could help you find good app investors? You like many other individuals may be surprised that the marketing companies do more than just marketing an app. They will also help you find a suitable investor. This is due to their extensive knowledge of the market, many years of experience, and a wide network.
When approaching app marketing firms, you should have a well laid out plan. It will clearly describe the app, why it requires funding, the different development stages, expected returns, the market and more. A good marketing firm will even assist you to come up with the best and also match you with the most suitable investor.
Learn how to pitch
Why is your app better than the rest? How does it guarantee the investor a timely return on investment? What problems does it solve? Why is the funding required? Which stage are you in? How long will it start to generate income? These are only a few of the questions you need to answer when coming up with an app pitch deck. Always put yourself in the shoes of the investor.
There are many hints that show investor interest: Will the investor shake your hand, nod his/her head in affirmation, or will he/she look sideways or ask you too many questions that you cannot answer convincingly. It is always a good idea to discuss the motivations of investors with other app developers and your mentors.
Have a prototype
The app market is still new and many investors do not have a clear grasp of what a succeeding app should be. This means that they will be a little hesitant to put their money in something they aren’t sure about. A good pitch will convince some but not all inventors. There are those who prefer seeing something practical. Creating a prototype is thus very helpful in app funding.
It should be an exact copy of what the investor will be funding. It should also show them how it looks, operates, the market it targets, design, format and more. An investor is more likely to be convinced by something he/she is able to see working. Working and seeking guidance from app development companies is beneficial. It is better to spend more money on a prototype and increase the funding possibility than pitching an idea without a prototype and ending up not attracting any inventor.
On paper, finding an investor of funding for your app may look easy. However, in reality, it’s not. In fact, many people give up on their app becoming successful after hitting numerous obstacles. The potential inventor may want too much control, you and the investor may not really click, or you may have poor pitching skills. To assist you to get good app investors or partners, we have outlined some of the most critical things. They include understanding the investor market, clearly defining your goals, learning investment basics, having a business model, and gathering information about the best funding channels. With these tips, getting funding for your app should be easier and less stressful.