Developing your mobile app faster, sumptuously paying for marketing and advertisements, and taking the app to the end users in a grand way is a dream of every app owner. However, this becomes a tall order when you are not strapped with that kind of money, and especially with an app that is yet to monetize. But, with an investor on board, you could sail through this process pretty effortlessly.
Be it a top app development company, or any growing business – let me be a bit outright here – finding right investors, gaining their trust, and convincing them to put money into your mobile app is not so easy.
Any article dealing with this topic can only tell you the approach. However, the success of your attempt really depends on how creative and potential your app is, and the kind of value it offers to the end users.
If you are planning to rope in an investor to support you in your endeavor, there are are certain procedures you need be aware of.
Let’s see what they are.
What kind of funding are you looking at?
Let’s say you accidentally bumped into an investor, who loved the idea of your app and asks you what kind funding your are looking for? And if you go blank, the scene wouldn’t be so good, would it?
Since the startup culture has reached its tipping point, there are a variety of funding happening in the market. As a business person you should be aware of these things and have clear idea of what kind of funding you are looking for. Are you looking for seed or pre-seed investment? Are you looking for angel investment or venture capital? We can run a separate blog on this topic. The best way to gain knowledge in this area is carry out a thorough research.
So, start digging, and be ready to answer that question.
You need to have a prototype of your app
First, you need to have a product to show. In most cases, instead of a fully completed app, a working prototype of the app is shown to the investors. A prototype is nothing but a working model designed to test how feasible the app is.
There are two types of prototypes, Low Fidelity and High Fidelity. And it is entirely up to you to decide which one would best suit to show it to your investor.
Low Fidelity Prototype
In this type there will be less visuals and the focus is more on functionality. Only selected attributes are shown visually, and only the main content is added. As a result, it is relatively easy to build and is best for translating high design modules.
It branches out into two types: Paper Prototype and Clickable Wireframes.
Fast to build
Not accurate while testing
Hi Fidelity Prototype
This prototype will have detailed designs, realistic interactivity, and most of the content will be in place. It branches out into two types: Digital Prototypes and Coded Prototypes.
Excellent usability testing results
Detailed interaction of UI elements
Has better chance in impressing stakeholders
Expensive to build
The kind of prototype you build may depend on your budget, time and resources. Having said that, you should not end up with a prototype that is insipid or uninteresting. Remember, the prototype is your first impression, so make sure it is well put together.
To gain a better understanding on building prototypes, do a research, talk to experts or experienced, take opinions, put in your own thoughts, evaluate, and then decide which one would work best for you – a low or high fidelity prototype.
Image Source: theninehertz.com
Once the prototype is ready, it is time to test its worth – not among yourselves, but with the real users. The insight you collect through the feedbacks and responses is called Proof of Concept.
Proof of Concept
This step technically inaugurates your journey towards finding an investor and it can bear a direct impact on your efforts.
Why you need proof of concept?
Just untangle the question. You need to provide a proof that your concept is worthy. The idea behind this step is to test your app with real users, and then collect positive responses and feedback to share it with your angel investors. Simply put, it is to determine or demonstrate the product’s potentiality and feasibility.
Once you have those impressive statistics about your app’s potentiality, create a neat, detailed and attractive presentation to show it to the investors.
Create a strong pitch deck
I keep iterating that it is not about shooting out your idea to hundreds of investors. It is all about targeting the right investor and hooking them with a strong pitch deck. If you know who to pitch, then it is all about perfecting the pitch to spearhead to the next round of funding.
If you are not sure about how to create a good pitch, here is a pitch deck template created by Peter Thiel, who was the first angel investor in Facebook (who made a $500,000 investment).
Here is another good pitch deck example created by Cabify, a Uber competitor, who successfully raised over $400 million in funding.
After you are ready with an impactful pitch deck, it’s time to meet the money people.
Finding the Investor
Neither there is a single roof under which you can find all the investor nor there is a single cut-and-dry method to find them.
Considering today’s flux of startup investment rounds, it may not be so easy to get in touch with investors and venture capitalists. But unique and viable concepts do grab investors’ attention, and there are several platforms that are exclusively meant for this purpose. Mega corporations like IBM organize periodical Startup Challenges where innovators get an opportunity to pitch their ideas to investors.
Angel Investor Network
The reason why it is a daunting task get in touch with in an angel investor is that they prefer to stay anonymous, where outside correspondences are carried out by their team of managers. The US alone has over 3000 angel networks with about 300,000 active investors. On the other hand, India has roughly about 500 investors with about 200 investments happening annually.
To help you start:
Here is the list of 8 Angel investment networks in India
And here is the list of Top 10 global Venture Captial investors to whom you can start pitching right now.
“A survey carried out by DocSend found that successfully funded startups had contacted 58 investors on an average, attended 40 meetings, and it took about 12.5 weeks to close their funding round.”
Venture Captial Funds
If you are looking for early stage venture capital funds you could check out First Round Capital and True Ventures.
Crowdsourcing is another option you could explore to see if it fits your business model. In crowdsourcing, a large number of people come together to invest in a particular idea, which is usually done on the internet. Kickstart, a bangalore-based crowdsourcing platform, is one such platform, where, crowdsourcing is done for film, arts, publishing, games and Technology.
Create your presence at places where investors frequent
If knocking at the investors’ door didn’t work, try to catch their attention at their favorite hangouts. Register with tech and innovation websites such as RocketHub, Fundable, IndieGoGo and Kickstarter. I am not saying you have a sure way for finding an investor here, but these places are worth checking out and making your presence.
Leverage social media
Get on the social media and create a buzz. Investors are pretty active in social platforms and continuously seek for new talents and groundbreaking ideas. So, head there to get noticed.
Check out your competitors
If your app has no competitors your chances are pretty high in getting an investor, but if there are similar apps out there it is important to track some information like, how different is your app from theirs? who is their investor? how is their app faring in the market? and so on. These insights can help you in steering towards the right direction.
Last but not Least
Never lose hope and focus on what you are doing. Even big corporations have tough time finding investors of their stature. The more unique your product is (both in terms of concept and value addition), the better. Highlight the USP of your product and prove the investors that your product is a differentiator in the market, and you a potential prospect.
If you are ambitious in finding an investor to fund your product, make sure you check all the above criteria, and it certainly wouldn’t hurt if you research further to check out some more.
Best of luck in your search for funding!
Ideaplunge is one of the best mobile app development companies around, specialized in Android app development, iOS app development, UI/UX designing, salesforce solutions, Dashboard and Analytics services. Today, it caters to all major industry verticals and has clientele spread across seven countries.