Choosing The Right Funding Method

Choosing the right funding method

The main hurdle for many entrepreneurs is, in the words of Steve Jobs, “thinking that a really great idea is 90 percent of the work.” It takes more than just inspiration to truly make an impact, and this is why choosing the right funding method is essential for the success of your mobile app. Let’s take a look at some of the avenues for securing finance for your brilliant mobile app idea.

Bootstrapping

Bootstrapping is a fiscally conservative way to fund an app, particularly if you have modest objectives and a longish development timeline. It’s basically financing the development yourself through money from existing revenue, like:
– Savings from a job
– Cashing in investments
– Revenue from other business
The term comes from the idea of ‘pulling yourself up by your bootstraps.’ It’s a perfectly acceptable method for funding an app if you have the means and opportunity. Like all funding methods, it’s important to have a plan in place so you don’t squander funds, and can manage the expenses over time.

Loans

Bank loans for small businesses are common practice in Australia. Opening up a line of credit with a bank will help you realise your mobile app dream quickly, provided you can pay back the loan, plus interest. Banks do expect a lot of due diligence and a thorough proposal. Expect to include:
– Market research
– Revenue projection
– Future direction of the company
– Current finances
– Capacity to pay back the loan
We’ll look deeper into how to write an excellent proposal and fund your mobile app with bank loans later on.

Crowdfunding

Crowdfunding is an exciting method for funding mobile apps and other ventures, by combining a crowdfunding campaign with marketing and social media. It involves tapping directly into target demographics and communities by offering them valuable rewards for being early adopters of your app, as well as if they encourage others to download. We’ll get into the ins and outs of running a successful crowdfunding campaign a little later also.

Government grants

For a long time, Australia ran a bit behind the innovation curve, and it wasn’t always easy to leverage government funding to build a successful technology platform like a mobile app. Now, both state and federal governments are discovering the benefits of stimulating technological growth in the country. Grants that target technology developers, innovators and incubators offer opportunities to fund mobile app development in full or in part with government assistance.

Investors

As innovation and technology becomes more important within Australia, investors and venture capitalists are taking notice and really paying attention to the future of the mobile app market. If your mobile app has the scope to deliver measurable goals in line with the desires of investors, then seed funding could present an opportunity to fund the growth and development of your app. Be aware that most angel investors require:
– A working prototype
– A strong proposal
– Signs of growth or market research

Family and friends

Finally, friends and family might be able to loan you the money to develop your mobile app. Getting into business with people you know and care for can be a risky proposition, but if you have contacts with savvy business knowledge, it’s an opportunity worth exploring.

Developing A Financial Plan

How To Apply For A Government Grant