How to find investors for your app is the biggest question app developers grapple with. You know parts of the answer, and yet, there are gaps you face challenges with. You know you need to have a killer pitch and that you need to woo investors and show them the potential of your idea. But how exactly do you go about doing that? What do investors look for in a pitch? How can you get yourself noticed and prove that you are a good investment?
You’ll have all the answers to those questions by the end of this post. You’ll know how to prepare the right pitch, how to set yourself apart from the competition and how to show investors your true potential.
1. Show Commercial Traction with Market Research
Contrary to popular opinion, investors aren’t just looking for a ‘great idea’. Whatever the next big idea is, chances are they’ve heard it a few times in the last week.
What they’re looking for, is a passionate visionary with a plan. You need to show them that you’ve done your research, planned your long game and are ready to hit the ground running. They need to know that you actually have the chops to execute this idea, build a great app and keep it running profitably long enough to make an impressive ROI.
So start by doing your research. No investor was ever impressed by “I believe this will be a great solution”. They need to see more tangible groundwork. You need to know your market. What problem is your app solving for users? How big is this problem really? Does it affect a significant number of people? Can you solve it effectively? Those are some of the questions you must have asked and answered, preferably with the help of some real user research. Hard numbers and data will always grab the attention of investors and show them how serious you are about this.
Be ready to say things like – “We interviewed 300 people and found that 75% of them wish there was an easier way to do ____”, or “We found in our research that 60% responders would be willing to pay for ____ if it saved them time and effort”.
You could do this in many reliable ways. Use online survey tools like Survey Monkey. Even if you have to pay a small fee, an online poll covering sufficient people will give you the tangible proof of concept you are looking for. Alternative you could circulate a simple survey among your known acquaintances and gather some data. You could start a blog or microsite and post short but interesting content about your idea and engage enough people to build a small community. All of these measures will go on to show investors that you are serious about this idea and are hard-working enough to pull it off.
2. Find Your Niche
The thing about apps is, that apps are good business, and everybody knows that. So your idea has probably already been built into an app in at least similar if not the exact same way you’re planning to build it. And let’s face it, no one’s investing in another app of a ‘type’. You need edge. You need to differentiate yourself from the competition. Instead of yet another travel app, how about an app for women travellers that ensures safety and security. Instead of another ecommerce app, how about an app that connects customers to their local stores, so they can support local businesses as well as enjoy the convenience of ecommerce.
The point is, you need to define your target audience in a specific niche. This in fact isn’t just about wooing the investors but for the long-term success of your app in general.
Investors would be instantly intrigued by an app targeted at a specific section of the audience. That is because such apps have a differentiating value. Users feel that the app is made exclusively for their needs and are more willing to engage with it. Everyone likes exclusivity, especially in the age of widespread generalization. Investors understand this and hence, are more willing to invest in niche ideas.
3. Get Your Elevator Pitch Ready
Not all investors at all times are willing to sit down and listen to your detailed plan of action. Sometimes you get only a minute, or a half, to tell an investor what your idea is. If you use that time wisely, you stand to land a meeting where you’ll get adequate time (and attention) to present your ideas in closer detail.
So you need to be ready with an elevator pitch – a concise pitch that tells what your idea is and what it does for users within 30 seconds. To do this well, you need to work and rework on exactly what you would say to your investor. You need to say this to yourself several times, like a well-rehearsed dialogue delivery.
An elevator pitch is not the time to tell your story or show why you’re passionate about the idea. In an elevator pitch, you succinctly describe what your app will do for the users and why would people want to download it. That’s it. You need to keep it short but punchy, this will take some practice and fine tuning. Focus on the biggest value your app offers, your biggest selling point. Focus on the biggest problem you are going to solve. Once you do that, you’re ready with an elevator pitch that could land you an investor meeting up close and personal.
4. Build a Prototype
Show, don’t tell. That’s the big takeaway in the investor universe. You can talk about your idea all you want but to really show investors how committed you are to this app, you need a prototype.
Don’t let the fancy words trouble you. Building a prototype is easy. You could build your own if you are a developer yourself, or contact an app development company to build one for you. A simple prototype can be whipped up quickly for an affordable price and show the investors exactly how your app will work. Check out this insightful post by Fortune on why investors love prototypes.
A prototype is akin to a low-fidelity representation of your final app. It gives you a chance to show off your app’s design and even logo and branding. Yes, this does require that you have worked on your app’s design, layout and basic features already before you approach investors, but that in the inherent power of it. When you have a prototype to show to your investors, not only are you showing them what your app will look like, but you’re also showing them the hard work and commitment you’ve already invested in this app and how serious you are about your idea. You are showing them that you are dependable and worthy of their money. Those are some of the most important traits investors look for when they decide to fund an app.
5. Create a Compelling Pitch Deck
When you go in to an investor meeting, armed with your brilliant idea, your competent research and of course, your prototype, the thing that plays your wingman is your pitch deck. This is typically a PowerPoint presentation that runs on the screen showing off key points as you explain. This compelling Airbnb pitch deck is all the inspiration you’ll need.
Best startup pitch deck examples
You don’t want your pitch deck to be a transcript of what you are saying. Make your slides highly visual and concise. Use them to show off charts, graphs and diagrams or highlight the most important keywords. This is also a chance to show off your app’s branding. Invest time in developing a logo, a slogan and a color theme to establish credible branding for your app. In addition to giving your app personality, this step once again ensures that investors know very well how prepared and invested you are in this idea.
Following all of the above steps will show your investors that you have not only a great idea for an app but also that you are a dynamic go-getter who has the chops to pull off this beast. If startup history has taught us anything, it is that apps with great execution matter more than apps with a great idea. Even when it feels like every idea in the world is taken, your execution plan id what will set you apart and make the investors want to give you their money.