How to get crowdfunding for your mobile app startup? How to get crowdfunding for your mobile app startup?
Developing a mobile app was never a cakewalk, and neither is it today. The app development industry thrives with the evolution of endless apps every year.
According to a report by Statista, the global mobile app market revenue may reach $420 billion by the end of 2022 compared to $318 billion in 2020.
Many emerging entrepreneurs today come up with a great app idea they truly believe in. But developing and launching an app in the market is a big challenge for them. They have to deal with investors for funding and work with developers and designers to successfully develop apps, along with many other crucial things to think about.
But the most challenging obstacle entrepreneurs encounter while bringing their idea to reality is the requirement of funds from the right investors.
Building the simplest customer-centric mobile app requires at least $10,000 or more. The more features and technology you add to the crowd fund app, the more costly it gets.
Crowdfunding is all about increasing funds for your crowdfunding startup app. Doing it correctly and efficiently will create buzz among the investors and help them gauge interest in your app. This article, we help you get the right funding for your mobile app startup.
Types of crowdfunding
There are four types of crowdfunding, and each funding option has a different kind of investor. Here’s a description of each one:
Donation-based crowdfunding occurs when investors give a campaign, company, or person funds for nothing in return. For example, suppose you create a crowdfunding campaign to purchase new assets for your startup app development company. The investors give you funds to assist you in your business growth.
Debt-based crowdfunding is peer-to-peer (P2P) lending form. In debt-based donations, the money promised by backers is a loan and must be repaid with interest within a given timeline.
This kind of reward crowdfunding happens when donors receive something in exchange for donations. It all depends on how much funds people give to a campaign, and they will receive the product or service at a low price.
Equity-based crowdfunding for startups facilitates giving away a part of their business in return for funding. These donations are a kind of investment where people receive shares in crowdfunding for startup businesses based on how much money they contribute.
Tips on how to get app crowdfunding for your mobile app startup
- Before heading towards the funding process of your app , make sure you have conducted in-depth research about the trends in the finance market and the investor's traction. Don’t ever try to go with the shortcuts, especially regarding financing, whether through venture capital firms or angel investors.
- Whether about tiny business or bootstrapping, ensure you maintain good bookkeeping practices. Financial lenders and investors will always want a look at the state of a company’s books at first.
- Always consider your value proposition. Investors are always keen to know how their money will help you reach your goals.
- Be innovative when it comes to fundraising. It’s much more than just simply a business deal negotiation. When it comes to fundraising, make sure you think out of the box.
- Share your passion and excitement with your audience, especially if you’re app crowdfunding.
- Make sure you have well-researched the market thoroughly and have a good understanding of your targeted market, your competitors, and other potential users showing interest in the product.
- There is an endless number of best crowdfunding for startups USA evolving every year. But one question that arises is what is your selling USP or what makes your product succeed and long-lasting in the market.
- Make sure you understand all the buzzwords around the industry with their proper meaning.
- Always be professional towards your commitments to make your investor realize that your team consists of professionals and enthusiasts. Make sure you will hire experienced specialists with extensive tech expertise.
Top 5 crowdfunding platforms for your app
Here is a list of app crowdfunding platforms you can explore and check which will work best for your business and your app. Each offers different aspects, so you can choose the one that will make your app boom in the market.
AppStori is an app-specific funding platform open to US residents. Here, you can publish developments and read comments on your app to make relevant changes your customers want to see.
The skilled professionals from AppStori will evaluate your project and give you a valid judgment on whether it will succeed. This we call the pre-qualification process. After this, you can start doing advertising for your app.
AppStori takes a 7% cut of your earnings, and Amazon takes 2-3% for credit card processing.
Indiegogo funding facilitates you to increase your funding by a specific date. Fixed funding returns funds to people if you do not reach your destination.
When using different rewards, you will certainly gather attention from different funders. You can use specific tips and tricks that Indiegogo shares to make crowdfunding for your app successful.
AppBackr is an app-specific tool that is a marketplace where those interested can make crowdfunding investments for Android and iPhone apps. Here you will get funding for the applications that have already been developed and made available to customers.
To get funding from AppBackr, you need to explain what your app is all about, what marketplace it is for, and why they should fund your app.
With AppBackr, investors will make money off your product. When you start making money, you will pay them more than they initially invested. Once your investors have received their initial investment plus the promised profit, you'll start receiving all the funds.
Appsfunder is a reliable tool for funding apps for the iPhone App Store and Google Play. The tool is conditional and includes an all-or-nothing funding method where projects are either fully funded, or no money is transferred. Funders will immediately access your app for free when they give the set amount you have put in place (between $1 and $5). The platform has an Expert Panel where developers can pitch their ideas and get help. This panel rates the developer on the following criteria:
• Business potential
Kickstarter is a platform that provides immense funding opportunities for campaign creation in the United States. It is a perfect platform for earning a crowdfunding app development as it permits you to take a unique approach to turn your app into a successful one.
The Kickstarter platform does not help you with the ownership of your product. Through the rewards you offer, these individuals decide on whether or not they want to invest in your product.
Benefits of developing MVP for the crowdfunding investors
MVP development provides businesses and investors with enormous benefits. It helps them to invest their funds with the best professional team and the growing industry.
1. Investors can now clearly see the product functionality
Developing MVP is one of the best options to present investors unique and minimal crowdfunding app features. Make sure the functionalities and features are clear to them. What kind of problems is your product solving? It will help them understand how it fits into the market and whether it’s right to fund further development.
However, it also provides your investors with an outlook on the potential of your product.
2. Investors can now easily check if the product is viable or not
It is challenging to determine whether the app you develop fits into the market and whether it will be successful. But, the outcomes of such an analysis are not always concrete as the market is hard to predict and needs a lot of factors to consider.
MVP development helps you provide a clear picture and permits better analysis of the product’s viability. If the investor sees such crowdfunding app features working, it helps them understand the additional features you plan to add. Additionally, during the MVP development, you can choose what features to include to create the best impression for the investors.
3. Investors will see your market awareness and expansion
Performing in-depth market research and analysis should be your first and foremost step before initiating MVP development. If you want your product to succeed in the market, you also need to know about your competitors and what element makes your software unique from others.
Most modern investors know that MVP creation requires much more time and effort for the best pitch. MVP development helps you to gain investors’ trust as they understand that you wouldn’t spend resources on MVP without knowing the market.
4. Considering initial feedback is important
Considering user feedback is a crucial tool for software development. Moreover, it also helps you identify the software's problems and permits you to determine which features need to be added.
Investors should also understand how well the funds are given and what needs to be done to maximize the profits. MVP will benefit investors with early users’ feedback.
Innovative and valuable app startup crowdfunding ideas fade away due to lack of funding. The competition for investors is going fierce and harsh. All you have to do is get homework done before entering the market, increasing your chances of winning. Make sure you choose the right investors to benefit from your crowdfunding business.
If you have questions about getting funds for crowdfunding mobile apps, get the proper assistance from reputed crowdfunding app development companies. The experts will guide you through the entire process and make your crowdfunding journey easier.
Q. Does crowdfunding work for apps?
A. App startup companies often use crowdfunding to find an innovative way of sourcing funding for new projects, businesses, or ideas. It's also great to create buzz and gain interest in your app if done perfectly.
Q. How do you start an app with no money?
A. There is a list of 5 ways to develop your app if you don’t have the funds to invest.
1. Reduce Feature Set
2. Raise capital
3. Find a technical co-founder
4. Build a proof-of-concept
Q. How do I secure my app for funding?
A. Here are seven ways to secure funding for your tech business:
- Begin with Bootstrapping
2. Friends and family loans
3. Take out a business loan or overdraft
5. Seek Angel Investment
6. Seek Venture Capital for your startup
7. Government programs and grants