Did you know that the global mobile app market generates nearly $60 billion in revenue every year? Also, many existing businesses are investing in the mobile app platform to diversify their business and create a wider reach. Ecommerce stores have apps that enable customers to shop from their mobile phones.
Several app-only businesses rely only on this platform to connect with their customers. Hence, it is clear that there is a huge scope for growth and development in the mobile app sector.
However, most of the brilliant mobile app ideas die quickly due to the lack of finance. The solution to this problem is to find a way to fund your mobile app.
Do you too have a great idea for a mobile app, but are not able to bring it to life because of the lack of finances?
In this blog, we will discuss 10 different ways in which you can raise funds for your app startup. But before we go into various mobile app funding options, we shall discuss the various points to keep in mind when you request for funding.
How to Ace Your ‘Request for a Mobile App Funding’ Pitch
(i) Know your mobile app – inside out
First, you need to be very clear about the features, functions, and audience of your app. You should be able to describe the functions from the perspective of the user – how it will benefit the user.
(ii) Analyze Your Competitors
There may be lots of other apps offering the same or similar services that you are planning to provide with your new mobile application. Study your competitors, find out the gaps in their services and see how you can fill that gap and capture the market.
(iii) Fine-tune your elevator pitch
You may just have 15 to 20 minutes to convince the investor to put down money on your app startup. In such a short span, you need to generate interest, capture their attention, and make them believe in your mobile application. Keep on working on your pitch till it is concise, informative, and attention-grabbing.
(iv) Have a prototype ready
A prototype can help you clearly describe your mobile application to potential investors. The prototype should have all the proposed features and their intended functions.
(v) Brand your app
Create a domain name and a landing page for your mobile application before you approach the investors. These steps legitimize your business and also create a favorable impression on the investors.
Read Also: Mobile App Marketing Funnel [Converting Users into Customers
10 Ways to Raise Funds for your App Startup
1) Crowdfunding
One of the best ways to fund your mobile startup is crowdfunding. In this mobile app funding method, you approach the public and ask them to invest in your mobile app. In return, you can provide shares of your business or offer products at a discounted price.
The most popular crowdfunding platform is Kickstarter. You can create interesting and attractive campaigns on this platform to convince the crowd to invest in your idea. Seedr is another crowdfunding platform where people can buy shares in exchange for investment.
2) Startup Investors
Approach Angel investors for mobile app funding. Angel investors are individuals who have a high net worth or business persons who are interested in personally funding startups. Angel investors are willing to invest a large amount and take the risk.
But, they will also expect higher equity in the business. Angels generally focus on sectors and domains that they have expertise in. They may also offer business advice and mentor you.
3) Business Grants
Check out business grants offered by the government. Many such programs have been designed to improve the business in certain sectors. However, you need to ensure that your mobile app checks all the criteria listed in the grant specifications.
4) Get a Partner
If you are finding it difficult to fund your mobile app startup, you can get yourself a partner. It is best if you look for a partner who is not from your industry, but comes from a different domain and is willing to invest in your mobile app idea.
In exchange, you can offer customer referrals, co-marketing opportunities, shares, and more. You can also partner with businesses to fund your mobile application. Many traditional businesses have a strong foundation but haven’t explored the digital space.
Partnering with existing businesses will help you get a flying start on your mobile application, but you should also be ready to share the app platform with the business partner.
5) Venture Capital Funding
Venture Capital Funding Obtaining mobile app funding from Venture Capitalists (VCs) is the fastest way to develop, publish, and expand your mobile app. You need to actively look for seed investors who are interested in mobile apps.
VCs have made some of the largest funding for startups, starting from thousands to millions of dollars. The catch is that the VC will expect to be a part of the board and have more control over the business.
However, if you’re lucky, you can also be mentored by these business experts. If you are ready for their high involvement for the high investment, approaching a venture capitalist is a Capital idea!
Read Also: Importance of MVP in Mobile App Development
6) Bootstrapping
Bootstrapping refers to the self-funding. You can invest your savings, salary, investment, or other means of income in your mobile app. This method of mobile app funding is usually done by working professionals who have a mobile app idea.
You can build the basic prototype or release the app and then approach for funding as your app grows and expands.
7) Bank Loan
If you have a reliable business plan with projections, then you can approach your bank for a business loan. You should do extensive competitor research before you prepare your business plan.
While applying for business loans, you should also check if there are any government subsidies and schemes for the sector in which you are planning to launch your app.
Startups may also get loans with no or minimal interest or without security. Explore all the available options offered by the lender before you apply for the business loan.
8) Awards, Campaigns, and Competitions
Watch out for startup campaigns and competitions and take part in them. PepsiCo10 program organized by the international cool drink seller Pepsi invited startups to send their app ideas. The winners got to meet the leadership team and digital influencers in New York.
A campaign called “MomInspired” was run by Huggies. This campaign invited parents to share product ideas. Innovate UK offers awards in various startup categories. You can visit their website to check if your app idea matches their criteria.
Winners and up to 4 runner ups also get an opportunity to showcase their prototype to corporate, public authorities, and potential investors. You need to check if your mobile app idea is in line with the categories of the award.
9) Your Network
If you have a network of friends and family who believe in your mobile app idea, you can request them for mobile app funding. You can either get loans from your friends or offer a share in the profits in exchange for their investment. These initial investments may not be huge but can total to a sizeable amount.
10) Initial Coin Offering
Initial Coin Offering is a mobile app funding option for blockchain-based startups. You can raise the initial funds and then create the prototype. The catch in this method of mobile app funding is that the capital is usually in the form of cryptocurrencies, which can be a little risky.
Read Also: Effective App Launch Marketing Strategy That Drive Success
Conclusion
It requires a lot of time, effort, resources, and technical expertise to build an in-house mobile app development team. To get the best results for your app idea, you need to partner with an agency that has the experience and expertise in this domain.
Redbytes is one of the top mobile development companies in the United Kingdom. We have created hundreds of mobile apps for iOS, Windows, and Android platforms. If you have a “million dollar” idea for a mobile app and want to breathe life into it, we are there to provide all the support. Get in touch with us today to book a consultation.