Why won’t you invest in my awesome app idea?

Everybody has ideas, this also goes for apps. Almost on a daily basis we talk to people that have one or more potential groundbreaking, world-changing app ideas. And that’s a good thing, we love to hear your ideas and use our skills to provide you a great product.

But, we get the question “why don’t you invest in this idea?” a lot, we rarely engage in this though.

But why? Why don’t we invest in your app idea? The answer might surprise you, it’s not money.

Ideas are no guarantee for success

Most of the people that ask us this question think their idea is the greatest and most unique ever. Let me clear something up, the power of a product or service isn’t the idea. It’s the execution and marketing behind it. The idea is necessary but not sufficient on its own, let alone the ridiculous offers we receive of the ‘generous’ 50% stock in exchange for a concept sketched on the back of a napkin.

Some examples

Examples of this are legion. Think of the following: Doodle Jump vs. PapiJump, do you even know the last one? It was there first. The same goes for Facebook vs. Friendster. And a more recent example in games: 2048 vs. Threes.

Time is scarce

It’s quite possible that you came up with the next Facebook, Angry Birds or WhatsApp. Our situation is that we bill by the hour (why we do this is an entirely different discussion) and in essence sell time, it’s our most valuable resource. That’s also the reason why we’re really picky on which projects we spend it.

The next Angry Birds? How appealing it might sound, it’s quite unlikely it’ll ever happen. Not only because Angry Birds was Rovio’s 52th attempt at a successful game (eventually saving them from bankrupcy) but also that you probably don’t have the resources Rovio had to make it such a success.

Developing and promoting a product or service costs time, a lot of time. That is, if you want to do it right. Spending time on marketing, promoting, communication, supporting your product or service. If this is not your main business at a certain point in time you’ll probably lack the time to really get it off the ground and destroying the ROI.

Apart from your own input, we don’t have the resources to spare.

Taking risks

So why would we invest in your app or start-up if you’re not willing to take any risks? We don’t. Especially in a situation where we’re dependent on someone we don’t know.

The risk for us is that we invest valuable time and get next to nothing in return. We don’t have much to gain to become an investor, we don’t lack ideas and if we have time to spare we’d rather invest that in our own projects, which we actually do during our YipYip labs. Those products are completely ours and include benefits like publicity, credits and profit.

Unless…

There are always exceptions. Most of the reasons to do so are where there is a certain commitment and risk-taking from our client. For instance:

• A client is willing to invest a substantial amount of his personal savings.
• It’s really a super-easy idea to prototype (which is rarely the case).
• We get more out of it then just the specific project like: valuable research material, great new leads/contacts or other commercial advantages.
• A client is investing time in the same amount and at the same time as we.

All the above are ways we minimize the risk of the project failing eventually and signal us we’re working with a real entrepreneur.

Money money money

But what part does money play in this equation? Although it’s not the only aspect we take into account when evaluating a potential project, it’s a biggy. Whether we believe in your idea or not. If you have the cash (or an other form of financing) you can get your idea produced no matter what, by us or by one of our competitors.

If you have money, there’s no need for us to invest. Even better: the profit of the product is all yours! And that’s probably what you want in the first place.

Making compromises

However, if we have faith in the idea and you have some money we’re always willing to discuss ways to compromise. We can put in a few extra hours to make the product better/faster/stronger, spreading payments or agreeing to a service agreement.

Conclusion

If you have an idea in which you truly believe and where you’re willing to put in 200% of your time… Find an investor, dip into your savings or set up a crowd-funding campaign, find a designer, developer (or an agency like us) and go for it!