How To Get Investors for Your Mobile App Startup In 4 Easy Steps 

Think you have the next big idea for a mobile app startup? Great! You have successfully completed step 1 towards launching your app in the market. So what comes next? Well, if you want to see your app idea go all the way, you need money. And unless you have a large bag just lying around, you need an app investor to fund you in this journey. 

A lot of research, marketing and development goes into creating an app, so not only do you need a good investor but also one that understands the process. Fortunately for you, the mobile app development industry has become quite big in the past few years as it is an increasingly profitable choice of business with mobile apps themselves becoming a must-have technological tool for everyone doing business regardless of their industry. Thanks to this, you have many different options to secure your capital.

But even with so many funding options, actually getting close to one and securing the deal is the tricky part. After all, you have to convince them that your idea is worth their money and getting someone to part with their money is no easy task to begin with.         

However, if you are truly interested in securing a place for yourself amongst the top mobile app startups in the industry, then you have come to the right place. 

Whether you’re just starting out or looking to expand, understanding how to attract investors can make all the difference. In this article, we will explore all the things you need to help navigate the process of finding and securing investment for your mobile app startup and the types of investors you might find along the way.

COMMON INDUSTRY TERMS FOR MOBILE APP STARTUPS 

First things first, learn the language of the mobile app startup industry so that you can get a better handle on things. After all, you won’t be able to convince others to invest in your idea if you can even properly explain your idea in the first place. Here are some of the most common terms you will probably hear to get you started.

Pre Seed Funding:

Pre-seed funding is an informal round of raising money for your idea. In this stage, your idea is just a thought with no research or data to back it up. This is why pre seed funding mostly comes out of your own pocket or from friends and family. You will need this amount to take your idea to the next step and refine it. 

Seed Round: 

A seed round is technically the second round of raising money for your business idea. But even still, you probably won’t be operational or even be anywhere near being operational just yet. Instead this money is used to improve your product and collect resources such as a skilled workforce. This time the money comes from angel investors or early-stage venture capitalists.

Series A/B/C: 

These are funding rounds that come after your product has been launched in the market. The money raised from these rounds is usually used to make adjustments or add new features to your product based on customer feedback.

Additional resource: https://www.investopedia.com/articles/personal-finance/102015/series-b-c-funding-what-it-all-means-and-how-it-works.asp

4 Step Guide To Securing Funding For Your Mobile App Startup

Now that you know the technical words that might come up in your journey, let’s go ahead and take a look at the necessary steps you need to take so that you can get your seed money. 

1. Create a Strong Business Plan

You cannot launch a new company without a strong business plan. It is after all the very foundation of your startup. This extremely important document needs to clearly outline your company’s purpose, target audience, and market potential amongst other things. It will not only serve as a roadmap for your business but also as a key tool to attract potential investors. Take a look at the key components of a business plan to make sure you don’t miss any of them.

Key Components of a Business Plan

Executive Summary: This is a brief overview of your entire business plan. It should capture the essence of what your company will do and in particular the problem it solves in a way that convinces those who read it that your company is a guaranteed success. This is going to be your first impression, so make it count.

Market Analysis: In this section, you’ll dive deep into your target market and competitors. Define the demographics of your specific audience, their needs, and how your company hopes to cater to them in the current digital landscape. Make sure to highlight any gaps in the market that your app addresses as this will be your business’ core strength and the key to making it stand out in the industry.

Revenue Model: Then, figure out where your revenue will come from. Be clear on where you stand and determine exactly how you plan to make money. Any potential investor that you approach will be interested to know how you plan to turn a profit before they even consider investing in your idea. Make sure to be specific about your pricing strategy and how it aligns with the market competition.

Marketing Strategy: Next, work out a detailed plan on how you will reach your target audience. This is where you should clarify just who your target market will be and the distribution channels such as digital marketing, social media campaigns, and partnerships you plan on using to get your mobile app startup company to them. A well-thought-out marketing plan can show potential investors that you have a solid strategy to get clients.

Financial Projections: Lastly, provide some realistic financial projections that cover at least the first three to five years your business will be operational. Research thoroughly and include expected costs, revenue streams, and when you anticipate you will start making a profit off of your business. This information will help convince potential investors that your idea is worth them investing in it.

Your business plan is the key to telling your investors that you understand your market and have a clear path forward. So make sure to spend an extra few minutes to keep it engaging and straightforward. Consider using visuals where possible to enhance understanding so that your investors can clearly see your vision.

2. Develop a Prototype or MVP

Once you have finalized your business plan, take some time to create a prototype or Minimum Viable Product (MVP). A prototype or MVP is essentially an initial version of your app with limited functionality intended to visualize your idea. This will be helpful in showcasing your idea to potential investors and convincing them of its feasibility while communicating your idea much more effectively. In case you are still unsure, here are all the reasons you might want to create one:

Benefits of a Prototype or MVP

Functionality: A prototype or MVP is great at letting you demonstrate how your app works in real time. It can help you refine your initial idea while also helping you establish strong credibility in the eyes of potential investors and convincing them that the whole idea is worth putting some money into.

Gather User Feedback: You can also use your MVP to collect feedback from your users. These insights can help you when it comes to refining your app and making the necessary adjustments before a full launch so that you can evaluate the success of your mobile app while also assuring potential investors of its profitability. This also helps show investors that you’re responsive to user needs which is a sign of a good businessman.

Highlight Potential for Growth: You can begin to track user engagement and interest through an MVP or prototype with the help of analytics such as number of downloads, crashes, and retention rate to fix any issues before launch while also highlighting the true potential of your app idea in terms of growth and market share to your potential investors. 

Taking the time to develop an MVP or prototype gives you something tangible that helps potential investors visualize your app’s success. This in turn helps create a relationship of trust which is a crucial factor in convincing them to put their money in your hands. To make sure you effectively present your idea, you can consider taking the help of an established tech company that specializes in creating prototypes or MVPs to help bring your vision to life. 

3. Network and Build Relationships

No business can survive the world of competition and the constantly changing digital landscape without having a strong network to rely on alongside some beneficial business relationships. Aside from that, building relationships with the right people can open doors and create opportunities for funding and securing the seed money for your business. Not only that, but it can also guarantee you great support when it comes to finding the right resources such as a workforce and business inventory so that you have all you need to succeed. Take a look at some strategies for effective networking down below.

Strategies for Effective Networking

Attend Industry Events: Participating in tech conferences, meetups, and networking events can help provide you with an excellent opportunity to connect with like-minded individuals, potential investors, and mentors while building strong business relations. 

Engage with Other Business Owners: Sharing experiences and insights with other business owners who have been on or are on the same journey as you can lead to valuable advice and introductions with key players in the industry. It can also help open new doors of opportunities like the chance to collaborate with others to create new innovative products and help get your name out in the industry.

Connect with Potential Mentors: Take some time to look for experienced professionals who can provide you with guidance and support such as helping you refine your initial pitch to potential investors to secure investments for your mobile app startup company.

Use Online Platforms: Online platforms like LinkedIn are great for networking. You can use them to reach out to individuals in your field, join relevant groups for networking, participate in discussions, and keep up with the latest happenings in your industry. When it comes to these online platforms, a warm introduction is often more effective than a cold pitch so don’t hesitate to ask for referrals from people you know.

Building a strong network is immensely valuable in the business world especially when it comes to creating a community of support around your startup. It is also the key to helping you find the right partnerships in your industry such as helping you find the best mobile app development company to bring your vision to life or in securing the capital for your business through a large choice of app investors. 

4. Create an Engaging Pitch Deck

When it comes to giving your pitch in front of potential investors you need to make sure you deliver an effective presentation that completely wins them over. A well-crafted pitch deck is your best chance to communicate your vision clearly to get the funding you need to realize your dreams so make sure you work extra hard at it and walk out of the room feeling like a champ. Take a look at the essential elements of a pitch deck down below to make sure your presentation covers everything that it needs to help secure your future.

Essential Elements of a Pitch Deck

Problem Statement: In this section, you need to be clear about the problem your company aims to solve. Make it sound relatable and compelling to the people you are presenting in front of so that they can realize that your business idea is worthwhile and needed in the current industry. 

Solution: Once you have explained the problem your company is going to work to resolve, provide a detailed explanation of how it will address the problem effectively. Take a moment to highlight the unique offerings that will set you apart from your competition. 

Market Opportunity: Next, go over the market share and potential for your business idea with respect to the current industry happenings. Use this moment to present the size and growth potential of your market using statistics and research to back up your claims. This information will help investors understand the potential return on any investment they give you.

Competitive Analysis: This is the part where you will expand on your previously mentioned unique offering and detail exactly how you plan to stand out from your competitors. This is where you need to really stress your unique selling propositions (USPs) and any advantages you have in the market to convince inventors of your ideas’ true worth.

Team Overview: Remember, investors invest in people as much as ideas. So make sure you tell them all about the strengths of your team and their relevant experience so that they know what you and your employees are bringing to the table aside from your business idea. A strong team can inspire confidence in your ability to execute the plan thus helping you secure the needed initial investment. 

Funding Request: At last comes the part that you made so much effort for, asking the potential investors for money to fund your business. Make sure you are clear about how much funding you need and how it will be used. Go over your entire budget and explain why this investment is essential for your app’s growth so that the investors know what they are getting into and what they can expect.

Your pitch deck is an essential tool in helping you present your idea in front of all the potential app investors. So make sure that it is visually appealing and concise. Go ahead and use some graphics and visuals to enhance understanding and increase your chances of effectively communicating your idea. Make sure to practice your presentation a few times to ensure confidence during the actual presentation while minimizing the chances of things going wrong.

Also check out: https://digitrends.co/blog/guide-to-mobile-app-development-quotes/

And: https://digitrends.co/blog/grow-business-custom-mobile-app-development/

TYPES OF APP INVESTORS YOU WILL ENCOUNTER

Now that you know what you need to do to secure your capital, take a moment to learn more about who you will be securing money from. There are many different options to choose from when it comes to getting funding, here are some of the types of app investors you will meet along the way. 

1. Angel Investors

Angel investors are typically high-net-worth individuals who provide capital to startups in exchange for equity. They often invest at the early stages and may offer valuable mentorship and networking opportunities.

2. Venture Capitalists (VCs)

Venture capitalists are professional investors who manage pooled funds from various sources, such as institutions and wealthy individuals. They usually invest in startups with high growth potential and often seek larger equity stakes. 

3. Crowdfunding

Crowdfunding platforms allow you to raise small amounts of money from a large number of people, usually via the internet. This method can also serve as a marketing tool, generating interest and a customer base before the app launches. 

Choosing the right type of investor depends on your startup’s stage, funding needs, and growth potential. Each type of investor brings different advantages, so it’s essential to align your goals with their expectations for a successful partnership.

Other resources to check out: https://sleek.com/hk/resources/taking-the-next-step-crowdfunding-vs-angel-investment-vs-venture-capital/

TIPS FOR A SUCCESSFUL MOBILE APP STARTUP  

Given that you now know all about the industry terms and types of app investors you will meet, here are some last pieces of advice for you. Read them carefully and make sure you keep them in mind going forward. 

1. Research Your Idea

Make sure you have thoroughly researched your idea before you even begin. Use surveys, focus groups, and competitor analysis to gather insights. The goal is to ensure your app offers unique value and addresses a real need. After all, you don’t want to find out halfway that your idea is just not worth the hassle and that you have wasted all your time and energy. 

 2. Choose Your Target Market

Defining your target market is crucial and will help you make informed decisions about features, design, and marketing strategies going forward. So take some time to determine the demographics, preferences, and behaviors of your ideal users. Consider factors like age, location, and interests to help you better understand your audience.

 3. Find the Best App Development Partner

Selecting the right app development partner is critical to your success. After all, your entire vision revolves around this app and so you need to make sure it surpasses all expectations. This is why you need to look for a team with experience in mobile app development, a solid portfolio, and positive client reviews. 

By conducting thorough research, identifying your target market, and choosing the right development partner, you can set a strong foundation for your mobile app startup. These steps will help you navigate the complexities of app development and increase your chances of success in a competitive landscape.

Conclusion

Getting investors for your mobile app startup can be a challenging yet rewarding journey. With a solid business plan, a prototype or MVP, strong networking skills, and an engaging pitch deck, you can secure the support you need from app investors to bring your vision to life.

Remember, perseverance is key. Every interaction is a step toward building your network and getting the investment you need. Stay focused on your goals, be open to feedback, and continuously refine your approach. With determination and the right strategies, you can become a successful name amongst the best mobile app startups in the industry.