From Concept to Launch: 10 Ways to Secure Funding for App in 2024

In today’s world, mobile apps are a big part of our daily lives and can help with many different things. But, developing an app and making it successful can be hard because of the money needed. This is why it’s important to have funding for apps.

Getting enough money is very important for app developers to make their ideas come to life, deal with the challenges of app development, and make their creations successful in the app market. Having the right money to help create, promote, and grow an app after it’s launched can be very important.

Creating mobile apps can be expensive. Even a simple app usually requires spending more than $10,000. As you add more features and make them more advanced using new technology, the costs will go up.

App developers can make their apps successful by learning about different ways to get money and coming up with good plans. In this post, we talk about different ways you can invest your money, the steps to get funding, and good ways to convince investors to support your app idea.

10 Ways to Get Funding for App 

Having a good idea for an app is important but not enough. Creating an app needs expert application developers. Making a mobile app is not easy, it requires money. Luckily, more and more people are using smart mobile devices, so there are many different ways to get money for an app:

• Bootstrapping
• Private investors
• Angel investors
• Venture capital  investors
• Personal network
• Crowdfunding
• App funding contests
• Bank loans
• Accelerator programs
• Grants

Each way to get money for your app startup has good and bad points, things you need to do, and things you can’t do. Let’s talk about each of them separately so you can figure out how to find investors for an app.

1. Bootstrapping

Bootstrapping is using your own money to fund your idea. Do you know how much money you can spend? This is a safe option because you won’t owe anyone money if your app idea doesn’t work.

If you have enough money saved up to pay for app development without causing too much financial stress, it’s best to fund the project yourself. If you don’t have enough money, you can ask your family and friends for help. This is a good way to get money for making apps.

2. Private Investors

Next, we will talk about private investors who can give money to fund mobile apps. These are small businesses in your area that work in the specific area your app is for. For instance, let’s say you have a special idea for booking tables at a restaurant.

You can talk to restaurant owners in your area and ask them to pay for creating an app that will help them do better than other restaurants.

This could work if your idea is right for a specific group of people or industry, and if you can talk to businesses with money to spend on an app but don’t have one yet. In this situation, it’s very likely that you’ll get a grant to develop your app.

3. Angel Investors

Angel investors are often the most interesting choice for people looking for app funding.

Don’t let the name trick you. Angel investors give you money, but they expect something in return.

They are not selfless like people think angels are. Getting support from angel investors is safer than getting other types of loans. Angel investors are people who use their money to help new businesses when they are just starting out.

Sometimes, businesses also become angel investors. In exchange, angels typically want a part of your company, or a type of bond that can be turned into ownership. This is an important thing, and you should think about it carefully.

Yes, it’s true that if your business idea fails, you don’t have to pay back the money that angel investors give you. Many new companies are interested in finding angel investors.

But if your idea does well, your “angel” will own a part of your business.

Usually, angels will ask for 10% to 25% of your company in exchange for the money they give you. The exact percentage depends on how much money they are giving. This means they will have some power over your business and will get some of the money you make or if you sell the business.

Family and friends, as well as private investors, can help fund your business like angel investors, as long as you have a good agreement with them. Some angels join in raising money from the public and also support organizations that help others, while others function as companies rather than people.

Some investors put their money together to invest in startups. Because angel investors take big risks in funding mobile app startups, it can be tough to convince them to invest in your idea. If you can do that and are okay with sharing ownership with someone else, getting angel funding for an app can really help your business grow.

4. Venture Capital Investors

Venture capital firms that invest in app development are similar to angel investors. They give a lot of money to help businesses grow, but in return, they get a part of the business. But, there are differences.

Angel investors are people who invest in great ideas for new apps when your business is just starting out. Venture capital firms give money for products that are still being made. Simply put, venture capital is given to businesses that they think can grow quickly.

Another difference between a venture capital investor and an angel investor is that the venture capital investor is usually a big company or fund, not just an individual with extra money. As a result, venture capital typically deals with large sums of money.

Having more money also means that you will have to give up a larger portion of ownership in your business. Expect that a portion of 25% to 50% will be given to venture capital investors. If you need money to make a big app, ask venture capitalists for help.

5. Personal Network

Typically, family is one of the best ways to get money to start a business, after using your own savings, and before asking friends. The people we know often believe in us and help us when we try something new that might be risky.

You still need a good app business plan and convincing sales pitch to ask for a loan. Convincing people you know is easier than convincing a stranger. Usually, you can get money for your mobile app idea from people you know if your project is small and doesn’t cost much.

Another option is to use your personal connections and resources to create a basic version of your product. A minimum viable product (MVP) increases your chances of getting funding from big investors.

6. Crowdfunding

Crowdfunding websites can get any type of investors except banks. When you tell people about your app idea on a website like GoFundMe, Kickstarter, or IndieGoGo, anyone can give money to help you make it happen.

There are many places where people can donate money online nowadays. Some focus on specific industries, while others help businesses find investors. There are different ways people can raise money from others:

Donation-based crowdfunding gives people who donate some extra benefits when the app comes out, such as getting it early or getting special features.

Debt-based crowdfunding is when you lend money to someone and they promise to pay you back.

Equity-based crowdfunding means that people and firms who invest in your business will get a share of the profits in return.

But crowdfunding gives more than just cash. Especially if we’re talking about getting money for an app. Crowdfunding websites can help you advertise your app to a big group of people, not just a few investors.

Anyone can look at your idea and want to give money to help make it happen. Some people are ready to pay to access your product early when it is released. Crowdfunding is a great way to get money for your app and let a lot of people know about it.

7. App Funding Contests

If you believe in your new app idea, you can try to get money for your app by entering contests held by important companies and investors. Some contests give money, while others also offer guidance and support.

If you want to enter the competition, you need to get ready. You’ll be competing with a lot of other people, so it’s important to be well-prepared. It’s tough to get funding for an app through a contest because there will be many strong competitors.

However, competing in a contest can be a useful experience and a way to get noticed for your idea even if you don’t come out on top. After a competition, even the people who didn’t come close to winning sometimes get offers.

8. Bank Loans

Bank loans are the least popular way for startup apps to get money. Banks don’t care if your idea is successful or not. They just want their money back by a certain date, along with interest. That’s why it’s not a good idea for a new business to get a bank loan.

It’s better to borrow money when your business is growing, not when you are just getting started. Getting a bank loan to fund an app idea is pretty much the same as getting any other big loan. It involves a lot of paperwork, interviews, and presenting your plans to make money with the app.

You also need to provide something valuable as security for the loan. You can borrow money as a person or a company. The things you need to do and the rules you need to follow will be different, depending on what you choose and where you live.

For a bank loan, you will need to know exactly how much money you need. Bank officials prefer specific numbers. If you don’t know how much it will cost to make your app, our experts can give you a price.

9. Accelerator Programs

Accelerator programs are a mix of learning about starting a business and getting some money to help people with good ideas. In return, the program gets a share of the business.

Consider accelerator programs as you would an investor.

Examine their track record of success and assess the quality of their training and guidance. Sometimes, you might trade away a big portion of ownership for information that you could find for free on the internet. In other words, you will be part of a strong group of experts who will help you achieve great success.

10. Grants

Grants for app development give money to people, small businesses, or groups to help them make, upgrade, or promote mobile apps. Grants are a good thing because you don’t have to pay the money back. They give money to help with app development if it meets the goals or criteria of the grant provider.

You won’t have to give away a part of your business, no matter how much funding you get.

It will be tough to get grants before doing any development work. Once you have a simple app to show, you might be surprised at how much government funding and other grants you can get.

Just by contacting local and state governments, you can create more opportunities for yourself. We suggest you regularly look at websites, sign up for newsletters, and keep up with industry news to make sure you know about the newest funding options for making apps.

Startup Funding Stages

Pre-Seed

First, we start by using our own money and finding private investors to help us. We focus on coming up with ideas and studying the market. The money raised at this point helps us study the market and make a good presentation to investors in the future.

Sometimes, when there is enough money, the pre-seed stage can be used to make a first version of something. If you have more than just an idea and some initial calculations, it could make investors more interested in what you’re offering.

Seed

This is the first stage with a lot of money from sources other than personal savings and network contributions. Here, people who invest money in new businesses, called angel investors, and companies that invest in new businesses, called venture capital firms, may get involved.

Money received will be used to grow the team working on development by getting help from outside for the technical side of the project. A good start means the idea has been proven and a basic product has been created to show to the public and potential investors.

Series A

Series A is the start of your business’s active growth. So this is when venture capital becomes important. Because Series A is very risky for investors, a strong elevator pitch is needed to get funding. If your app passes this stage, it has a good chance of being successful.

Series B

If you have made it to Series B, it is likely that your app will be successful. This phase is about growing quickly and making yourself more visible. At this time, the value of your shares goes up, so you can sell less of them to investors and still have control of your business.

Series C and Later Stages

At this point, if your business is still doing well, it’s definitely thriving. This means you earn enough money to pay for all your usual expenses without having to ask for more money from other people or organizations.

How Much Money is Required to Develop an App?

As your startup grows, you will need more money, so it’s important to figure out how much funding you need at each stage. In our experience, it’s very important for startups to know how much money they need when creating an app. Not having enough money for a project can make it fail if you can’t get more money quickly.

At the same time, it’s good to have more money, but remember that getting more money means giving up more ownership of your company. At the start of each step, ask yourself: How many shares can I give away without causing big problems to get angel investors or venture capitalists to invest in my app idea? Stick to that number and don’t go too far from it. Ultimately, you should still have the most shares.

Mobile app startups can get different amounts of money. Even though you can get an approximate idea, the exact numbers will vary based on how difficult your idea is and the team you will work with. Here is a basic estimate of how much it would cost to make a mobile app for both iPhone and Android:

Stage	Amount ($)	Expected return share (%)
Pre-Seed	100,000	10 – 25 (Angels)
Seed	150,000 – 1,500,000	10 – 25
Series A	<3,000,000	25 – 50
Series B	<5,000,000	~33
Series C and Later Stages	>5,000,000	~33

Remember that the money is not only used for creating the app, but also for other things. There are many different costs, like marketing, staff who don’t work on making the product, and software.

Tips to Get Funding for an App

Do you understand how apps get money, what choices there are for getting money, and how the process usually works for funding a new business? Let’s discuss how to get investors interested in your app idea.

How can you persuade rich people and companies to give you money instead of someone else? How can you create a strong quick speech and presentation to sell your idea? There are ways to get money for your app idea.

Investors usually just want to make money on their investment. Using what we know as software developers, we will now talk about the specific things that can show investors that you can make a good return on their investment.

Have an Unique Idea

Or at least it’s an improvement over the current options for a certain issue. Nobody wants another copy of Facebook, even though many people are unhappy with it. Your idea should solve problems that people have in a new way and provide solutions that haven’t been used before. Many companies that create apps for others have people who can help you come up with a special reason why your app is valuable.

Have a Profitable Idea That Fits the Market

To get money to start an app, you have to show that people want to use it in the market you are targeting. Put your money into studying the market and keep watching what’s popular on mobile devices. To get investors, you need to show how many people will like your app and how much money it can make.

Have a Good Business Plan

Many app investors like to give money to startups whose owners have successful experience. Having a clear plan for growth shows that you are prepared, especially if it’s your first time. Many investors like to see a well-thought-out plan for how a business will grow, reach customers, and become bigger.

Have a Specialist Team

When you have skilled people with the right experience working on your idea, it’s like having a guarantee that the app they create will be liked by users and investors. If you’re not a developer and don’t have a team of experienced professionals, it’s best to hire an app development company to make your app for you. Search for app development companies that have finished projects in your specific industry.

Have a Prototype of Your App

Having a working prototype or minimum viable product shows how committed you are to your project and how much potential your idea has. Even better, if the product is past the minimum viable product stage and is already making money.

Even if you don’t have a model, you should tell your potential investors about the stage your product is in and what you plan to do first if you get funding. It’s better to give as much information as you can about yourself, your team, and your idea. Please maintain professionalism and be concise.

Don’t spend time on extra details and concentrate on what’s important for people who invest in mobile apps, the possibility of making money. It’s easier to give away money when you believe you will get it back with more money added to it.

Also Read: 15 Game-Changing Mobile App Development Trends In 2024

How to Increase the Interest of Investors?

In 2024, just having a cool app idea isn’t good enough to get investors interested. Ultimately, just because an app like this hasn’t been made yet doesn’t guarantee it will be successful.

Someone else may have looked into it and found out it’s not a good idea to invest in it. So, before talking to the investors, you need to make sure you have solid evidence that your idea can be turned into a product that makes money.

And doing that usually takes up a lot of your time and money. You might be thinking about how to start the project without the money. The not-so-good news is that you may need to spend a few thousand dollars at the start of the project.

The good news is that it greatly increases your chances of getting a much bigger investment in the future. Here are some things you can do to increase the interest among your investors.

Validation of Idea

Ensuring that your idea is worth looking into and putting money into is the first step of your project. Carefully examine the app idea at this stage, figuring out if it will work and if it is a good fit for the market.

Also carefully check your idea to make sure it is special and meets the needs of the market and users. This helps others understand how your app fits into the market.

Vision Description for Product

After confirming the idea, work with your team to clearly describe and explain the vision for the product. It describes what the app wants to achieve, how it will be helpful, and how it will affect people. It explains why the app is valuable and what users can expect from it. Having a clear vision about the working of your product is very important.

Compilation of Business Model

Have a good business plan that shows how the company will make money, where it will spend money, who its customers are, and what makes its products or services special. This step sets the foundation for an app that can make money and last a long time, the kind of app that investors want to support.

Competitive Research

When you do market research, look at all the other apps out there to see who you are up against. You need to understand who your current and future competitors are. The process involves looking at what they are good at, what they are not so good at, how much of the market they have, and what plans they have. So you can change your plan, help you make smart choices, and show the app’s money-making possibilities to investors.

Creation of UX and UI

Imagining how people will use your app and how it will look is important when showing it to investors. So, now ask your designers to make concepts of how the website or app will work and look.

So, you can show investors a real preview of how the app will look and work. This will help them understand the product better and see that you care about making it user-friendly.

Calculation of Economics

One of the main reasons why investors are interested in the app is because it can make money. So, it’s important to figure out how much money the app will make, how much it will cost, and if it will make a profit.

In this process, carefully look at how much it will cost to get new customers, how long they will keep using the app, and other financial details to figure out if the app will make money and be able to last over time. As a result, the investors can see how much money they might make.

Estimation and Scoping

Before starting the project, the investors should have an understanding of what the project involves and what they need to make it happen. To do this, make a detailed plan for how you will develop the app.

Look at what the app needs to do, how long it will take, and how much it will cost. So, you can feel more confident about the app’s planning and execution when you present it to investors.

Presentation of Pitch Deck

The last thing you need to do to get ready for your meeting with investors is to make a really good pitch presentation. This presentation usually has information that will convince investors to invest in your business, from how you solve problems to how much money you expect to make. So, make a cool and informative presentation that tells an interesting story, to increase your chances of getting money.

We can’t deny that this process takes a lot of dedication. It usually takes 3-4 weeks to complete and costs between $5000 and $7000. By doing this, you will show that you are good at your job and very devoted to the investors, greatly improving the likelihood of winning them over.

Also Read: How Much Does it Cost to Make an App in 2024: Understanding Cost Factors

Key Components of a Business Pitch

• Executive Summary: Begin with a short and interesting summary that gives an overview of your app, what makes it special, who it’s for, and how much money you need. Be sure to explain the issue you are fixing and the potential for your product in the market.
  
• Problem Statement: Clearly explain the issue or problem that your app helps with. Show why current solutions don’t work and prove that people want your app. Give information, research about the market, and what users think to back up what you’re saying.
  
• Solution and Value Proposition: Show your app as the answer to the problem you found. Please describe how your app is distinct, groundbreaking, and better than other options that are available. Highlight the special things about it, the good things it does, and why people should use it. Add pictures, outlines, or sample designs to show what your app will look like and how it will work for the user.
  
• Market Analysis: Do a lot of research on the people you want to sell to, find out how many there are, how much they might grow, and what they like to buy. Determine who your audience is and create profiles of your typical customers. Talk about how you will sell your product and get and keep customers. Please provide any analysis that shows what makes you better than your competitors.
  
• Team and Skills: Display the skills and knowledge of your team members, focusing on their experience in making apps, using technology, advertising, or running a business. If any advisors or experts in the industry help your business, talk about what they did.
  
• Financials: Provide estimates about the money coming in, money going out, and important numbers to help understand the financial situation. Tell them how much money you need and how you plan to use it. Demonstrate what you know about financials and how much your app can make.

Wrapping Up

Getting funding to create an app is very important for making new ideas come true and doing well in the competitive app market. Whether developers choose to fund their project themselves, ask for money from individuals or companies, or gather money from a large group of people, each option has its own points to think about.

What always stays important is making a plan, making good decisions, and never giving up. No matter how they get money, app developers need to show they have a good plan, something valuable to offer, and a strong idea of how to carry it out. This will help them get investors and the resources they need.

Getting funding for apps is not just about getting money, it’s about helping new ideas, encouraging creativity, and providing useful solutions for users. By using the right money and doing a great job, app developers can set themselves up for success and have a big influence in the fast-changing world of mobile apps.

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