By 2018, less than 0.01% of mobile apps will...
I have an idea for an app. What’s next? Mobile application development prices start at $ 10 thousand. Many startups struggle to raise funding and bring their ideas to life – simply because they don’t know where to look for investors. If that’s your case, here’s a step-by-step guide to launching a successful application with limited funding (and no programming experience)!
If you’re more of a Steve Jobs (aka creative idea generator), you need your own Wozniak to handle the tech issues. In case you’re a lone ranger, you can hire a reliable vendor. And that’s where the real trouble begins.
Even if you outsource app development, you’ll have to pay as much as $ 10 thousand for the simplest app (coding doesn’t come cheap after all). The prices for a mobile game start at $ 50 thousand. And you also need a solid marketing budget.
Don’t try to pull a Rovio: virality is also created by marketers, and the incredible success of Angry Birds is by no means a coincidence.
If you’re 100% sure you have the next Clash of Clans up your sleeve & will easily generate $ 1 million in daily revenues, you’d better raise funding and build a high-quality mobile app. Otherwise you’ll be slammed by reviewers and have your brilliant idea stolen by somreliable vendore tech-savvy guy.
You don’t know how to get angel investors for an app? Here are a few tips every entrepreneur should remember.
Tip 1: I need an MVP to impress my investor
In mobile and web app development, the term “minimum viable product” usually refers to the stripped-down version of an application which performs its core function (orders food like QikServe or connects drivers and passengers like Uber).
However, creating an MVP also requires coding and testing. In order to generate customer feedback and raise money, you need to show users in what way an app can possibly improve their lives.
You can’t splurge on a minimum viable product? Big deal! Not all killer apps started with traditional MVPs.
Back in 2007, Dropbox founders put on a simple website with a funny animated video to explain what their program does exactly. The page got 75 thousand subscribers in no time. Being in the spotlight, they declined Apple’s acquisition offer and managed to get money from the Y Combinator startup fund. In 2014, the company was worth $ 10 billion and has been growing ever since.
Tip 2: I have an amazing idea for an app & know how to pitch it
Once you build an MVP, don’t register on an angel investors’ website straight away.
In 2015, Ken Yarmosh (founder & CEO of SavvyApps) published a curious article on fundraising. Yarmosh receives phone calls from indie developers almost every day. And they go like, “I need an investor ASAP! My idea is brilliant!”
Even after a 10-minute talk, he seldom understands what it’s all about. Guess why? The guys who were struck with the idea don’t know a single thing about their masterpiece, too!
If you’re not an app pro, you should at least come across as one! Have you ever heard of the “elevator pitch” concept?
If you run into a venture capitalist & happen to ride in an elevator with him, you must be able to present your project using the limited time you’ve got (60 seconds on average).
Here’s what you can do to make your project attractive for investors:
- Stand out from the crowd. Getting a domain name & doing some app branding is a great way to show you’re serious about the project. If you struggle to build a simple WordPress website and hire a web designer, use services like LaunchRock and 99designs to set up a landing page and create a logo;
- Educate yourself about investment. Large companies like Dropbox can easily close a funding round with $ 250 million. It’s different for startups, since you’ve got neither end product nor traction. If you’re lucky enough, you can raise up to $ 1.5 million. Find out what type of capital you’re allowed to take & how you’re going to pay it off;
- Learn to make a killer first impression. Think of a creative way to deliver your app idea to investors or online community. If you meet business angels, you’ll be given no more than 20 minutes (including questions). In order to leave your audience craving for more, you surely need an outstanding media presentation. Don’t turn into a “slide freak”, though. Three, six or ten slides is more than enough to outline the project. Study presentations on SlideShare to draw inspiration from. Keep it simple and practice your speech till you can’t get it wrong.
Tip 3: I make the best of fundraising sites
With an MVP app and newly developed presentation skills, you can try your luck and look for investors. Where can you find them?
- Kickstarter. The famous crowdfunding platform was launched seven years ago. Ever since, more than 100 thousand successful technology, music and film startups raised money via Kickstarter. In order to join the community, you must have clear project & funding goals. You’ll become a creator, and you’ll soon be joined by backers – the people who believe in you and are ready to support you financially. During the development process, you share different versions of the app with your backers. It’s a perfect way to generate user feedback & get more investors on board. Although you keep 100% ownership of your work, you should allow the backers to oversee the project & provide them with a free copy of your product (and other rewards). The Kiwi for Gmail (previously Gmail for Mac) app was launched this way. The Zive startup was going to sell the app for $ 9.99, so they decreased the backer price to $ 5. The company needed to raise $ 20 thousand in funding (which means 4 thousand backers). It was a real challenge, so they gradually raised the price and offered extra benefits for users. As a result, Gmail for Mac earned $ 30 thousand in 3 days. The success of your venture largely depends on the strategy you choose. Kickstarter is easily one of the best fundraising sites; yet, it’s all or nothing. If you don’t reach your funding goal before the campaign expires, you won’t get a cent;
- AngelList. The social network connects business angels and startupers like you. The platform is specifically targeted at early-stage businesses. In 2014 alone, over 200 tech projects raised money via AngelList ($ 104 million in total). Most AngelList ventures get funded in less than 25 days. Even if your project fails to impress businessmen, it’s great to simply have an AngelList profile. Who knows, maybe you’ll end up getting money from Syndicates (same as backers on Kickstarter);
- Go4Funding. The platform (which is similar to AngelList) is a meeting place for startups and investors. Business angels can view adds from the “Funding needed” section & choose the most attractive investment ideas. In order to attract larger audience, you should provide links to your MVP and outline your business model (including expected ROI).
The list of options is by no means complete. A through search on LinkedIn can also bring good results (as long as you put in the right keywords & have an original idea for an app).
Looking for angel investors and setting up a website surely takes some time. Don’t lose motivation! Users want mobile apps to change their lives for the better. And if that’s your case, you can always raise money and find a reliable vendor to get your idea off the ground.