When users appreciate an app, it usually revolves around it being a great idea. But ideas alone will not make an app successful. App success is all about its execution. If one opens Google Play or the App store on their phone and check out the top apps, many of those apps sound silly on paper. That is why it seems like quite a challenge to find funding for mobile app ideas. Without a rock solid business plan or probably a previous development experience, finding funds for mobile app ideas poses to be quite a challenge. Not all apps find it easy to be funded. There are particular types of apps that are more likely to get funded and would actually benefit from funding.
These apps broadly fall into the following categories:
- Apps for Social networking or communities
- Big budget games
- Original ideas backed by great incentives for investors
Let’s say you have a brilliant idea and it more or less falls into any of the above categories. But it’s all on paper and you need to build your app and get it out there. Again, you have no money or funding to develop your app, because your app hasn’t earned a dime yet. This is a common challenge for app startups. It would start feeling like a road with no route map. Luckily, there are been wanderers before you, who have crossed the same path and have mapped it out for you.
1. CROWD FUNDING – Alternative finances
One of the most interesting ideas that you’ll probably come across. This allows you to present your pitch to the public and ask for minor investments. This minor investment generally gives them a share or probably a free copy when the app is officially released.
Crowd funding works by setting an end goal, which is releasing your new app, and a financial target. The best thing about this is that there is no seed money required. What you really need is a fancy idea, skills and time to develop it.
One main disadvantage of crowd funding would be, if your financial target is not met, you’ll have to return all your investments.
2. BUDDY FUNDING – Family and Friends
This is a very risky way to go, so if you think this might work out for you, proceed with caution. Buddy funding is a method where your investors are within your network i.e., your family and friends. However, a word of caution, it is generally told not to mix friends/family with business.
3. A BANK LOAN
When the economy is good, banks are more than happy to give you a bank loan. The most important point to be kept in mind is a well-crafted business plan that clearly states the intentions of the loan and how would you put the money to use.
4. ANGEL INVESTORS AND VENTURE CAPITALISTS
Angel investors are individuals who invest in companies that have a concept or an idea, which is on paper and not yet materialized by means of a developed app. If they believe in your idea, they will fund you. However, this would work best if you can showcase a prototype (of your mobile app.
5. CO-FOUNDER – FINDING A BUSINESS PARTNER WITH FUNDS
This is a great way of funding yourself. If you can partially fund yourself, consider partnering with a co-founder who is willing to share the cost and the risk with you. Having a co-founder increases you are credibility, as there is at least one other person who believes in your idea. If you are not technically skilled, try bringing in someone who is.
FOUR PLATFORMS YOU SHOULD KNOW ABOUT WHILE TRYING TO GET FUNDS FOR YOUR APP
Kickstarter is one of the largest crowdfunding platforms. It encourages creativity and uniqueness.
AppBackr is a recently launched platform for crowdfunding. The service connects app developers with buyers (called backrs) who are interested in purchasing wholesale copies of the app in question. Developers get paid immediately, and backrs make a profit as the apps sell in the app marketplace.
Indiegogo is an international crowdfunding website that allows funds for people. It functions on rewards based system, meaning donors, investors, or customers who are willing help to fund a project or product can donate and receive a gift, rather than an equity stake in the company.
AppStori is an app specific funding platform. Developers “can raise funds, find beta testers, build an audience, advertise their needs and wants, and create an overall “Stori”, allowing friends, family, and consumers to be part of the team that brings an app to market.” This is an all-or-nothing platform so you have to hit your goal to get the funding.
In conclusion, it is important to understand that every individual who has successfully raised funds for their app have in a way put some of their own money. Another important thing to keep in mind is, it takes the lot of research, great ideas, time and commitment. A combination of all these is what makes your app successful.