How to Raise Funding for Your Mobile/Web App Prototype
The idea of coming up with an app based on the need for making it a reality. Many people have come up with app ideas thinking that it will be the next trendsetter. However, is not always the case. When looking for funding, investors want to see more than just the idea.
Prototypes give a presentation of how the app will look like. Basically, it outlines the idea of an app. Prototyping has become a vital aspect in the entire process of mobile app design. Without the prototype, then it will be cumbersome for you to get funds from an investor.
Some of the benefits of a mobile app prototype include:
- It offers clarity on how the app will function and the user interaction with the app.
- Validation on how the app will be acknowledged later in the market.
- It minimizes the time and funds for development
- Helps one to know the user’s preferences and need in order for them to make the necessary changes.
- Makes it possible to test on real users before developing the real app.
Prove Your Concept
Investors invest in ideas and businesses that have proof of their concept. They like to see that it more than an idea. Showing them how it works will make them feel more confident to invest. Even in our day to day lives, you find that more people will trust buying things that they can see rather than buy things that someone told them about.
That is why online retailers like eBay and Amazon use images of products to show customers what they desire to purchase. The same goes for finding an investor. Prove to them that it is no longer an idea, but a working concept that you have invested your time and money in.
Know Your Market
Market research is very important in building any successful business. Most people think that research should be done when you get funds for your prototypes, which is wrong. No one can put their money in your idea if you do not know what you are dealing with. First of all, there is a huge possibility that your app is not unique.
There may be apps that have already solved the problem that you aim to solve. It is vital to define your distinguishing features from your competitors. When conducting market research you should also look at the following:
- Latest trends
- Target market analysis
- Marketing plan
- Price analysis
Show Commitment
Practice makes perfect, that is the quote that should be ringing in your head before going to talk to investors. If you think you have everything in place go back and check again. Investors not only invest in your business, but they also invest in you. Make sure you do your homework before pitching your idea.
Know the ins and outs of your business from the marketing plan, target market and your final product. Be ready to answer any questions that may be thrown your way. Presenting a functional prototype shows that you are dedicated to the vision of your product. Practice with friends and family and read books about public speaking until you get it right.
Find out How Other Similar Apps Have Acquired Funding
It is hard to convince an investor in a meetup or an event to fund your app. A better way to go around it is to look for companies that have funded your competitors. Organizing and signing up to every meet up is a waste of time. You need to be smart to get ahead. Contact your competitors to find out where they got their funding from.
Connection
Secure investors listen more to someone they are familiar with compared to a stranger. For you to be ahead of others who are also looking for investors, collaborate with someone to introduce you. If your family or friends have proper connections, you are in luck.
If not you can easily find someone to help you out on social media platforms like Facebook, Twitter, and LinkedIn. Establishing such connections will open a huge door of opportunities at your doorstep.
Find the Right Investor
Finding the right investor is easily said than done. The chance of hearing more No’s than yes when pitching your idea is very high. At times you will have to turn down investors if they undervalue your idea.
Learning from every no you hear will help you grow and make your product better. Understand why the answer was a no instead of a yes. Ask for ways you can improve your app to make it better. Learning will help you to fill the loopholes in your app that may lead to failure.
Get to Understand the Investment Basics
The investment process should not be taken lightly. When someone agrees to invest in your business, they expect you to follow your outlined business plan. They also expect you to return their investment with an interest.
Most investors invest in businesses that are already working. You need to familiarize yourself with the basic and establish the capital you are willing to take.
Crowdsourcing
Raising funds does not necessarily mean that you have to pitch your idea to a room of investors. You can easily start a campaign using Kickstarter and focus on promoting it. Many entrepreneurs have managed to find capital funding through crowdsourcing.
The best way to get to fully benefit from crowdsourcing is giving the description of your business idea on your pages. Making videos showing the product and the motivation behind it can take your prototype off the ground sooner than you think.
Treat crowdsourcing like pitching your product to a number of investors. The benefits of crowdsourcing include boosting your brand when it is still an idea and you do not have to give up part of your business to an investor for funding.
Conclusion
It might not be easy to get funds at first but once you get it, business will get easier. Funding with help your business come up with app feature faster, market your app effectively and build a platform for future testing of ideas and find a strategic market for the product.
Another common trait among people who have successfully secured funds is that they invested their own money in the business. This will increase the confidence that investors have towards your app. Investing more in the company will also translate to you getting a bigger share.
All in all, you should follow each step carefully, for a better chance of you securing funding.
