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It can be difficult for startups to secure funding for their app ideas, especially if they don’t have a track record of successful app launches or a large network of investors. However, app development agencies can provide valuable assistance in getting the funding needed to bring an app idea to market.

Agencies have the benefit of working with numerous startups who have been through the fundraising process. They’ve seen what works and what doesn’t, and can help you prepare for your own fundraising efforts. Let’s explore the ways an app development agency can help you secure the funding necessary to bring your app to market.

1. Help You Find Investors

Leveraging Your Network

When you first seek funding, you may not feel comfortable asking your network for money. It’s tough putting yourself (and your relationships!) on the line. However, if you’re working with an app development agency, they can help you leverage your network to find potential investors.

A common approach is to ask your network for introductions to potential investors. Instead of asking for money directly, you’re asking for an introduction. If the person you’re asking is interested in your app idea, they may then express a willingness to invest instead of referring you to someone else. This indirect ask can help you feel more comfortable asking for money, and help potential investors feel more comfortable if they have to turn you down. An agency can help you navigate these personal requests for funding.

Leveraging the Agency’s Network

Just as you have your network of people you can ask for introductions, so does the app development agency. However, the agency’s executives also want to protect their relationships, meaning they won’t blindly refer you to everyone they know. Instead, they’ll want to know that you’re a good fit for the investor they’re referring you to. That means it may take having a few discussions with you before the agency is comfortable referring you to an investor in their personal network.

Approaching Potential Investors

Beyond personal networks, there are other ways to find potential investors. For example, you can look for investors who are interested in the industry or market your app is targeting. Online communities, investor directories, and local entrepreneurship groups are all good places to start looking for potential investors. Your local Small Business Development Center may also be able to help you find investors. The Nashville Entrepreneur Center is a great resource for entrepreneurs in the Nashville area. Agencies with startup experience will be able to point you toward such resources.

2. Connect You to Other Funding Resources

Agencies may be able to connect you to other funding resources as well. Startup accelerators or incubators, for example, may be able to provide funding for your app idea. Launch Tennessee connects startups with funding and resources across any business sector.

Some agencies may be aware of local grant programs they can connect you with. Federal grants can be found online through Grants.gov, and the Small Business Administration can direct you toward small business grant programs. Grants typically require a proposal or other approval process, which experienced agencies may be able to help you with.

Crowdfunding is another option for funding your app idea. Platforms like Kickstarter and Indiegogo allow you to raise money from the public for your app idea. An app agency can help you prepare a crowdfunding campaign, and may permit you to cite their experience in your campaign once you commit to working with them to build your app.

3. Help You Prepare Your Pitch Deck

A pitch deck is a presentation that summarizes your app idea and the business opportunity it presents. It’s typically used to pitch investors, but can also be used to pitch potential partners or customers. A pitch deck may be the only thing some potential investors see before deciding whether to invest in your app idea. Therefore, it’s important to get it right.

App development agencies who have worked with a lot of startups can help you create a compelling pitch deck. They’ll know what investors are looking for when assessing an investment opportunity.

4. Prepare You for Investor Meetings

Speaking of pitching, agencies can help you prepare for investor meetings. They’ll know what questions investors are likely to ask, and can help you prepare answers in advance. An experienced agency can roleplay as a potential investor and conduct mock meetings to help you refine your pitch and presentation skills.

5. Help You Write a Business Plan

Some investors may wish to see a comprehensive business plan before investing in your startup. This will require more in-depth documentation of your business goals, market opportunity, and business strategy than can fit in a pitch deck. The time investment in writing a business plan can be significant, but an agency can assist you in preparing one.

If you’re early enough in your planning process, an agency can help you develop a business plan from scratch. They may have ideas about monetization, target markets, and business models that are likely to be successful based on their experience with similar startups.

6. Help You Prepare Your Financials

A strong financial model based on sound assumptions is a critical component of a good business plan. Agencies can help you build a financial model that demonstrates the potential for profitability and return on investment. They will understand all of the near-term and long-term costs associated with app startups, and can help you build a model that accurately reflects those costs.

7. Help Market Your Startup to Investors

If you wish to cast a broad net when seeking investors, an agency can help you market your startup to investors. Getting your startup in front of the right people without existing connections to those people can be difficult. A targeted marketing or publicity campaign can help. Agencies can help you look for opportunities to get in front of your dream investor demographic through press, digital ads, and other channels.

8. Help You Develop Intellectual Property

Many investors seek out investment opportunities with startups that have significant intellectual property (IP). The allure of IP is that it can be leveraged in several ways throughout the lifecycle of a business. Early on, IP protections can hold off competitors while you take your initial product to market. Later, IP can be licensed to other companies, or even sold outright, to generate revenue.

Agencies can help you develop IP that will be valuable to investors. This starts with identifying the IP that’s most valuable to your business. In plenty of instances, this means identifying patentable inventions within your app idea and filing a patent. Trademarks and copyrights can also be valuable IP assets, and agencies can help you identify and protect those as well.

9. Partner With You to Launch Your App

Finally, some app development agencies are open to partnerships with the right startups. Instead of requiring you to pay cash for their services, they may be willing to work with you in exchange for some sort of equity or revenue sharing deal. The structure of these deals varies, but some common examples include:

  • Equity: You give the agency a percentage of your company in exchange for their services for some amount of time or a specific scope of work. Sometimes agencies will instead lower their rates in exchange for equity.

  • Convertible notes: Instead of you paying the agency right away, the agency keeps track of the cost of services they provide, and you promise to pay them back when you raise money. The payment is then converted into equity in your company.

  • Revenue share: The agency receives a percentage of your company’s revenue for a certain period of time or up to a certain amount.

  • Equal partnership: Your startup and the agency are equal partners in the business venture. You both contribute to the business, and you both share in the profits. This model requires a lot of trust and communication between the two parties, but can be a great way to get your app idea off the ground.

We’ve entertained all of these options with potential clients and have found that the best deal structure depends on the specific circumstances of the startup. If you’re interested in partnering with an agency or otherwise working with us to secure funding for your app idea, we’d be happy to discuss options with you.