How To Pitch Investors
Like A Seasoned Pro

You’ve launched your minimal product. You have traction, a business plan, a strong pitch deck, and you’re ready to fundraise… but there’s one issue – you don’t have the first clue on how to pitch to investors. Don’t worry, the pitch process can be frustrating to everyone and it can almost seem scary until you’re actually out there doing it.

If you’ve ever attended a Pitch Day or have witnessed numerous pitches, it’s easy to see that some people seem to have the gift of pitching while others just seem uncomfortable, timid and uncertain. There’s a major difference in these two types of entrepreneurs and it’s not ‘natural talent’ – it’s knowing how to pitch effectively and generating the necessary experience by pitching your business over and over again.

At ThinkLions, we’ve worked with hundreds of businesses around the world – helping them create the best investment tools and consulting with them to develop successful pitches. In this post, we will share a few tried-and-tested tips to help you deliver the best possible pitch and raise the necessary funds for your startup.

What To Do Before You Pitch

There are several things you should do before approaching an investor to maximize your potential for success; but if this is your first time pitching, you should start by familiarizing yourself with the process.

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The great thing about living in today’s world is, we have access to things we could never access before the “internet age”. Twenty years ago, you may be walking in to give your first pitch without even knowing what a successful pitch actually looks like. Today, you can simply go on YouTube and type in “pitch competition” or “investor pitch” and watch hundreds of pitches; preparing you for what to expect. Preparation is key, and using tools like YouTube can give you a serious boost and a major advantage when you’re standing in front of a potential investor.

Your first investor pitch shouldn’t the first time you’ve pitched your business. By the time you’re in front of a potential investor, you should have already tested your pitch dozens of times. Write out a few different pitches. Pitch it to yourself in the mirror, pitch it to your family and friends. If you’re tripping over your words and finding that your nerves overtake your delivery in front of your brother or cousin – how do you think you’re going to do when you’re in front of several experienced entrepreneurs and investors? Pitch to anyone that will listen – then ask for their honest feedback. Ask them what parts they understood and what parts they didn’t. Wait a few days and ask them what they remember from your pitch. If they don’t even remember what your business was about – maybe you should go back to the drawing board before pitching in front of an investor.

using-tools-like-YouTube-can-give.jpg

Finally, record yourself delivering the pitch. Even if you’ve given your pitch in front of family and friends 100 times, there are still weaknesses that you may not notice until you’re actually watching yourself. For example, a client of ours once told us that while he thought his delivery was perfect, he realized only after recording himself that he used the filler “um” over sixty times during his 7-minute pitch. Realizing the existence of this subconscious habit, he started to practice slowing down his delivery and taking small pauses instead of using filler words – a simple solution that made his pitch increasingly more effective.

I know what you’re thinking, “I’m not the type of person that does well speaking in front of people.” Nobody is comfortable speaking in front of strangers, especially not investors, until they have done it over and over. If you’re not good at public speaking, now is the time to build that skill. Raising funds is going to require you to go outside of your comfort zone – shaking unfamiliar hands and pitching crowds that you aren’t used to communicating with.

How To Deliver An Effective Investor Pitch

How-To-Deliver-An-Effective-Investor-Pitch

Putting together a winning pitch isn’t easy. For many entrepreneurs, it’s easy to talk about your business for hours and hours on end, but condensing it to under 10 minutes is a major challenge! To give a great pitch, you’re required to decide which points are most relevant, and then figure out how to tie that information together to persuade investors to be a part of it. Delivering an effective pitch means stepping outside of the box and speaking confidently, even when you know that the odds are against you. Every month, thousands of investors are pitched by new startups – and every month, thousands of startups are rejected. However, out of those thousands of startups, a few will succeed. A select few will break the mold and deliver a pitch that leads to a deal.

If you want to know how to pitch to investors successfully, you’re in the right place. Below, our experts at ThinkLions have put together five tips to help you maximize your chance of pitching yourself into an investment deal.

1) Know What Makes You Special

Know-What-Makes-You-Special

No matter how unique your business seems, likely, it’s not as unique as you think. You’d be surprised to know how often investors hear, “we are the Uber for (fill in the blank)” or “we have the next solution to disrupt the (fill in the industry) sector”. Ideas are a dime a dozen and you’re not going to turn an investor’s head based upon your idea alone. Find the thing that makes you special – whether it’s the traction you’ve already gained, a new process you’ve perfected, or real lives that your solution has changed. Find your special sauce, and pour it all over your pitch. Investors turn down good startups all the time. Don’t be good, focus on what makes you great.

Take a true assessment of your business. Examine every sentence of your pitch and ask yourself, “has this been said before?” and “has this investor heard this line before?” If the answer is yes, replace it with something that the investor hasn’t heard before. Never leave a gap where an investor has a chance to lose interest – be great from the opening sentence through to the closing. 

2) Tailor Your Pitch To Your Audience 

Your first pitch probably won’t be your last. Likely, you will pitch to many different investors before finally landing a deal. Investors don’t all have the same goals, objectives, perspectives, experiences or backgrounds. It is critical for you to learn about who you are pitching to before pitching to them. Knowing what is important to them will give you the opportunity to tailor your pitch accordingly.

See what you can find out about the investor or the firm – do they typically invest in startups or existing businesses? What range of funds do they generally offer? Is there a specific industry that they usually invest in? Are there any patterns you realize regarding the businesses they have invested in previously? Ideally, you want your pitch to be like a perfectly wrapped gift for every investor you deliver it to. Your pitch should push the buttons that get them excited and should avoid pressing the buttons that deactivate their enthusiasm. Always remember, an investment deal isn’t a one-way benefit. Don’t just focus on why their investment would be great for your business, but allow them to understand why your business is perfect for their specific investment portfolio.

English novelist Charles Reade once said, “If you wish to please people, you must first start by understanding them.” When it comes to pitching an investor, this couldn’t be truer – if you want them to understand the value of what you are delivering, you must first understand what it is that they find valuable.

3) Use Time To Your Advantage

If there is one common regret that entrepreneurs have after failing to secure an investment, it is that they wish they had more time to say everything they wanted to say. In many cases, pitches will have a time limit – and if they don’t, it’s still wise to be brief. Knowing that you only have a certain number of minutes to deliver all of your information can seem extremely restricting. How do you explain the last year of traction and the next three years of forecasts in ten minutes? In some cases, such as a pitch competition, a team may only have a minute or two to deliver their entire pitch.

Where the average startup sees limitations, a winning team will see an opportunity. A time limit can be used to your advantage if you implement the right strategy. In many cases, investors aren’t really sold until the question and answer portion of the pitch when they get to inquire a bit further. Knowing this, it is wise to strategize your pitch to captivate the audience with strong information; but to present the information in a way that will immediately drive specific questions during the Q&A session.

For example, if I just landed Walmart as a large client, I can set up this information as “we recently secured a partnership with one of the largest retailers on the planet.” By framing the information this way, I know without a doubt that someone will ask, “who is the retailer?” during the Q&A session. Once they ask this question, I can delve into information about the partnership without being held to a time limit. First, know your audience; then use what you know to craft not just the perfect pitch, but the perfect pitch experience.

4) Create an Entertaining Pitch

Create an Entertaining Pitch

Just to clarify, this doesn’t mean walking into your pitch dressed as a superhero or doing backflips during your presentation. However, if you’re going to keep someone’s interest for ten minutes, you’ll need to keep them on the edge of their seat.

Consider the way an author or film writer keeps their audience entertained. There’s an introduction where the characters are introduced and the audience is given the chance to relate to the characters. Then, there’s a huge challenge or obstacle that a beloved character is faced with. The climax hits as the character tries to find a solution to their issue. They find a solution and the world is better because of it. Then, there is an ending. In many ways, this is exactly how your pitch should be set up – get them connected to the characters, introduce the problem, build up to the climax, then provide a strong closing.

Investors are pitched by businesses constantly. The majority of pitches they hear, they forget about within an hour. If you want to succeed, your pitch needs to be unforgettable. Whatever method you take to achieve this, make sure that you give a memorable pitch that stays on the investor’s mind even after the pitch has concluded.

5) Develop a Great Pitch Deck

Strengthen your pitch by developing an amazing pitch deck that helps the audience follow your presentation and helps them visualize your message. Your pitch deck must create a harmonious balance with your pitch. It should have enough words to summarize the message, but not so many words that the audience gets caught up in reading the slides instead of listening to your presentation. It should include images and visuals, but not so many graphics that it becomes a distraction to your message. Without using too many words, your pitch deck should be a positive tool that supports your message – while being explanatory enough to stand on its own and deliver the right message even when you are not pitching.

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How To Pitch Investors Successfully

Following these tips will help you put together a pitch that stands out and delivers exactly what investors are looking for. However, if there is one key to success when pitching investors; it is to take each pitch as a learning experience, iterate your delivery, and improve your pitch each and every time. The more often that you stand in front of investors and answer the unexpected questions that may come to you – the stronger, more confident, and more successful you will become in your pitching efforts.

At ThinkLions, we have helped hundreds of startups during the fundraising stages. From business planning and pitch deck consulting to app development and beyond; we are the team you need to help bring your startup ideas to life.Contact us today and schedule a consultation with one of our app startup experts!

What Is The Best
Business Plan Format?

Let’s face it, writing a business plan isn’t as easy as it looks. Sure, you know your business – but putting it in a business plan format that investors can easily digest can be tricky. Developing an investor-ready business plan can be a major undertaking – especially if you’ve never written one – but if you are seeking funding for your business, you will likely need one.  

Sometimes, your business plan will need to do all the speaking for you. In some occasions, potential investors may ask to see your business plan before they agree to listen to your pitch. The unfortunate part is, an investor’s attention span may be extremely limited to businesses they aren’t already familiar with. If your information isn’t structured into the right business plan format, you may lose their attention quickly.

At ThinkLions, we have worked with hundreds of businesses; helping them create winning business plans and raise funding for their app startups. After years of developing our process, we have put together a tried-and-proven simple business plan format that has worked for many of our clients. In this article, we’ll discuss the business planning process, examine what you need to do before writing your business plan, explain how to develop the best business plan model, and introduce our business proposal outline.

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Before You Write Your Business Plan

Writing a business plan isn’t the first step you should take in bringing your idea to life. Every day that you actively advance your business, you will uncover new information that will be important to add to your plan. By nature, basic business plans are full of projections. However, if you haven’t done the necessary work beforehand, you won’t have the data needed to make an honest assessment of your business. Knowing how to format a business plan is part of the formula, but the preparation is key to success. 

Your business plan format is important, but it’s more important to make sure that you have met the milestones required to prove the potential of your idea. Before you write your business plan, put the necessary time and effort into accomplishing the following:

  1. Know Your Market: Having a fantastic idea means very little if it doesn’t solve a real problem for a real market. The majority of your business plan will center around proving that a market and market demand actually exists. Before writing your business plan, identify your initial market of focus. Learn everything there is to know about your customer. Go out and talk to real consumers. Join forums and online communities where your consumers hang out. Find their pain points. Listen to what they say about competitors. Get to know them intimately. The more you know about your audience, the better you will understand their needs and desires.
  2. Validate Your Idea: Once you know who your market is, you should test your idea with them and validate your assumptions. Before you write a business plan and ask an investor to invest in your idea, make sure your idea is worth investing in. Build a minimal viable product (MVP) and launch it to a limited audience. Adapt your product until you’ve truly created something that effectively solves a problem and is in demand by your market.
  3. Gather Data: Google is a great source of information, but if you are going to impress investors, you need real primary data from real customers of your business. As you validate your MVP, monitor important metrics such as cost per acquisition, conversion rate, and etc. This data will be used to show traction, forecast trends, and will act as a foundation for your financial projections.

The ThinkLions Business Plan Format

There’s nothing fancy about the business plan format we use at ThinkLions, but it’s a business plan layout that has worked for us over and over again. Furthermore, we’ll give you a few tips for each section – tips that we’ve gathered over years and years of developing startup business plans. Click below to download our business plan format doc. 

Executive Summary

Although the executive summary should be written last, it appears first in the business plan outline. In the executive summary, you will give a quick overview of the most notable details. This section should touch on all aspects of your business including the problem, solution, competition, marketing strategy, founding team and financial projections – but in a condensed manner. Although the executive summary is a component of the business plan, it should be strong enough to stand alone as its own document.

Here are a few tips to make sure your executive summary is as strong as possible:

  1. Write it last – Think of your executive summary like the back of a novel. The book itself shouldn’t be built off the summary, but the other way around. Write the rest of the business plan first, and then use the executive summary to summarize the most important points. 
  2. Make it persuasive – Your executive summary should display the highlights of your business and build curiosity within the reader. It should make readers want to read the rest of your plan to find out more. Fail to gain their attention with the executive summary and they may not even read the rest of the plan.
  3. Get to the point – The executive summary should be brief – about one to two pages is ideal. Be brief, but powerful. Make sure every word counts. Don’t dive too deep though, you’ll have the rest of the business plan to get into the intimate details.

Company Details

After the executive summary, we officially start our business plans with details about the business itself. This includes a company summary with milestones and history; short-term and long-term objectives; and the mission and vision statement.

Company Summary

Start off this section with a quick description of your company. Provide a great elevator pitch and talk about the milestones that you’ve accomplished to date.

Here are a few tips to make sure you nail this part of the business plan:

  1. Show progress: As mentioned previously, before you write your business plan (and definitely before you start approaching investors); validate your assumptions by launching a minimal viable product. Show your progress to date. Explain how your progress proves that a demand truly exists for your product or service.
  2. Tell the company story: Don’t get too lengthy here, but give readers an idea of how you started your business. Provide context to how the founders realized that a real customer problem existed. This section gives you the opportunity to really connect with readers and to get them excited about your business.
  3. Provide metrics: Even if you have fantastic writing skills, it’s the numbers, stats, and metrics that investors really pay attention to. Show your most outstanding metrics here. If you have 1,000 customers already using your solution, explain it in detail. Or, if you have already started earning revenue, showcase how much revenue you’ve earned so far. Likewise, if you have generated fantastic marketing metrics, tell readers about it and explain why it matters!

Objectives

Before you start talking about the strategy to meet your goals, you need to make those goals known. Think about your financial goals, your user objectives, the goals you have for the development of your product, your team ambitions and more. In some way or another, every section in our business plan format will be used to describe the steps you will take to meet these goals and objectives.

Mission/Vision Statement

Construct a great mission and vision statement and include it here. Think deeply about what your company really is, who you serve, and what you stand for. The best mission statements are short and to the point, but powerful enough that readers can easily comprehend why the company needs to exist.

Products and Services

You’ve already given a summarized version of what your business is, but now you will get into the real detail of your actual product or service. In this section, describe the product’s features and abilities. Consider the features that set your products apart from competitors. If you’re in the ideation stage, your product may not physically exist yet; but this section should be written so well that readers can easily visualize it. If you have a physical product, add images or 3D product blueprints. If you are an app startup, show screenshots of the app or wireframe images.

Industry and Customer Analysis

Every business plan format will include some type of industry and customer analysis. These are the sections where you will include research to prove that a market and demand actually exists for your product or service.

Industry Analysis

Don’t assume that you will be successful just because you have a cool product. Successful businesses are those that solve a problem for a specific market (or multiple markets). Furthermore, even if you can prove a market exists – you still need to prove that the market is actually in demand for the product or service your offer.

Select the market that is best served by your product or service. Research it deeply. Find the data and statistics that support your case and explain why those stats are important. Look at how the market has grown historically, and identify trends that show where it will grow in the future.

Customer Personas

Once you’ve identified the markets you will serve, it’s important to also explain exactly who your customer is. How old are they? What do they do for a living? Are there specific challenges do they face? Which publications do they read? What podcasts do they listen to? Who are the influencers that they follow online? Where do they live? What are their interests? The more you know about who your customer is, the more effectively you will be able to reach and serve them.

Detail your ideal customer as if they were a real person. Give them a name and write this section in a way where a reader can immediately understand who your customer is. After giving life to your customer persona, answer this question – how does your business solve their specific problem?

Marketing Strategy

The marketing strategy will explain specifically how you will reach the market and convert them into buyers of your product or service.

Pricing & Positioning

In this section, you will explain your pricing strategy and showcase how your business will bring in revenue. Will you succeed by being cheaper than competitors? Will you provide a ‘luxury’ service or product and charge more than less-luxurious competitors? Consider how your product will be positioned in comparison to competitors and display the prices you have selected for each product or service you offer.

SWOT Analysis

The SWOT Analysis will allow you to describe your business’ strengths and weaknesses; the opportunities that you will capitalize on; and the threats the business will face. Typically, a SWOT Analysis is presented in a matrix with bulleted points, but we advise adding a section under the matrix that explains each point in more detail.

Marketing & Promotional Techniques

Since you’ve already launched a minimal viable product to the market, you should have an idea of what techniques you need to capitalize on to reach your audience. There are many different marketing strategies you can implement from SEO to influencer marketing to ads and beyond, but you should only focus on the most effective strategies that will allow you to quickly acquire new customers with a low CPA.

Furthermore, explain the expenses involved with implementing each strategy and the return on investment that you expect. If you mention Facebook marketing, explain how much you will put towards marketing each month, how much you will spend per click, and what percentage will convert into paying customers.

Competitive Analysis

The competitive analysis should thoroughly detail how your solution compares to your competitors’ solutions. To make it easily digestible, consider adding a table that shows each feature of your business and product; and show how it compares to the features that your competitors offer.

Also, tell about your competitive advantages. What makes you special? Why should consumers choose your solution over the competition? Even if your business is closely similar to the competition, there should be something that makes it unique. Explain your unique selling points and what makes your business stand out amongst others.

Operational Strategy

There is much more to operating a business than just having a good idea. Bad operations can quickly derail a business, while a strong operational strategy can help catapult a startup to success. In our business plan format, we focus on several main areas of operation – Location, Quality Control, Customer Service, Staffing & Training, and Organizational Structure.

Quality Control

No matter if you are offering a physical product, a service, or a software – quality is key. Maintaining quality though can be harder than it seems.

  • When dealing with physical products, it’s important to figure out how your product will be manufactured and how you will ensure that the manufacturers are maintaining a high-quality standard. Explain how quality will be assessed at each stage from manufacturing to final delivery.
  • Those offering services will often need to depend upon their employees and staff to deliver the best level of service to customers. Employees that deliver underwhelming services can cause customers to perceive the entire brand negatively. In this section, describe the processes you will put in place to help employees deliver the best services, and how these services will be assessed for quality.
  • Software products can be extremely fickle. One line of bad code could potentially crash an entire system. In this section of the business plan format, consider how you will deal with bugs and software updates. Describe your relationship with your developers – will they be in-house or third party? If a third party will be used, how will you ensure that they will be available to quickly address bugs found in the product?

Customer Service

Let’s face it, even the strongest brands are faced with dissatisfied customers every now and then. The way in which you deal with these dissatisfied customers will be critical to your success as a business. A single detractor can potentially turn away dozens of potential customers with one bad online review. In fact, consumer reviews are trusted up to 12 times more than a manufacturer’s description. The way in which you serve your customers, and not just the happy ones, will play heavily on how much consumers trust your brand.

In this section, address exactly how you will deal with customer dissatisfaction. Will you have a no-questions-asked return policy or will you only allow returns after 7 days? If a customer is dissatisfied by the service your employees provided, will you send someone else out to fix it? The steps you take to remedy your customer situations may have immediate implications on your financials – for example, a recall could cost a business millions of dollars. However, the impact of a dissatisfied customer (or several) will cost much more in lost business and diminished brand trust.

Staffing & Training

Unfortunately, your personal capacity is limited – there are only so many hours in the day and so much energy you can exert before you become overwhelmed. For any successful B-quadrant business, having the right staff in place at the right time is critical.

For this section, thoroughly assess what your staffing needs will need to be over the next 3-5 years to meet the goals that you outlined in the “Objectives” section. If your objective is to scale 10x over the next year, you will also need to scale your team so that there is enough capacity to meet that goal. If your goal is to expand internationally within 3 years, you may need to hire international staff to manage things on-the-ground in these regions. Each position should be reflected in your business plan, along with their expected date of hire and salaries.

Unfortunately, employees don’t come already trained. Even if they are highly experienced in their specific area, they will likely need some guidance. How will you train them for success? Will you have a specific training program that each employee must attend? If so, this is the section to talk about it!

Organizational Structure

Now that you know what employees you will need to hire, you can create a simple hierarchy structure that shows who will manage each department and which positions will fall within those departments.

Management Team

Great businesses don’t build themselves. Instead, they are built by fantastic teams who have the right skills and backgrounds. An amazing business idea without a great founding team is like a racehorse without a jockey – it may have potential, but it’s the rider that pushes it to success. In this section of the business plan format, show that you have the right team and right advisors to launch, grow, and scale a profitable business.

Management Bios

The most effective teams have several motivated members who each have skill sets that complement one another and contribute to the overall progress of the business. When writing the bio for each member, consider the following:

  • Background: Take a look at the background of each team member. Do they have past experiences that will help move the business forward?
  • Skills: What skills are necessary to successfully implement the steps described in the business plan? Are all of these skills present in your current team?
  • Contribution & Responsibility: What tasks are each individual responsible for? What have they contributed to the business thus far?

Advisor Bios

Great founding teams also have extensive networks with advisors that they can turn to for advice and insight. Businesses often face challenges, but by relying on the experiences of others, teams can often avoid certain obstacles or solve them quickly.

In this section of the business plan format, provide a short bio for the advisors that have committed to working with you. Detail who they are, what achievements they have made, and the highlights of their backgrounds.

Financial Projections

When writing your own business plan, the financial model is likely where you will find the most difficulty. If you are a startup, your financial model will include future projections with a 3-5 year window. If you are writing a plan for an existing business, the model will include financials from the previous several years, along with future projections. In most cases, a proper financial model will include:

  • Profit and Loss Statement: Summarizes projected revenue, costs and expenses.
  • Balance Sheet: Displays the company’s assets, liabilities and equity at a specific point in time, showing a balance between outgoing and income funds.  
  • Cash Flow Statement: Shows how the cash balance is affected by changes in balance sheet accounts. Also shows the impact of investing and financing activities.
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Here’s the major tip for developing the financial model for your business plan – minimize assumptions. While there will be certain things that you will need to assume it’s best when your model uses real numbers.

  • The best financial model uses past financial history to forecast future revenues, expenses, and profits. For startups, this may mean launching a minimal viable product, getting it in the hands of real users, and generating real stats.
  • An average financial model uses secondary data from highly reliable sources, studies, and surveys. However, secondary research only relates to the overall industry – while using real numbers from your business relates directly to how your business performs within the overall industry. Secondary research is good, but statistics may vary from one study to another. Make sure you only use data from high-quality and reputable sources.
  • The least effective financial models are full of assumptions. In these plans, entrepreneurs guess what their expenses will be, what portion of the market they can reach, and how much revenue they can generate; instead of backing it up with real data and research.

Funding Requirement

Finally, reveal your financial ask and explain exactly why you need that amount. Itemize where each dollar will be spent to give readers a clear understanding of your financial requirements. Lastly, state the amount of equity will be given in exchange for the investment – based upon the current value of your startup.

Exit Strategy

Some business plan writers choose to include an exit strategy, while some do not. Some investors will require it so that they can get an idea of when they will receive their investment back along with a major payoff. Others, however, know that the future of a startup is totally uncertain, and therefore, they don’t really pay much attention to this section.

Whether you decide to include the exit strategy in your business plan format is up to you – but if you do, here are a few tips:

  • Research similar businesses that had a successful and profitable exit. Were they acquired? Did they merge with another business? Did they go public? Explain how other similar businesses were able to exit and why you believe your business will be able to exit in a similar fashion.
  • Tie your exit into your financial projections and show a projected valuation. Furthermore, show how an XX% ownership in the company (whatever percentage an investor would receive for matching your financial ask) will multiply in returns at exit based upon that valuation.

Using Our Business Plan Format

Unfortunately, just having a great business plan format isn’t enough – now you have to actually write your plan. When creating your business plan, stick to the facts. Investors have short attention spans when it comes to even a simple business plan, and too much fluff will quickly diminish their interest.

Furthermore, some investors (and banks) may have specific business plan formats that they prefer. Make sure to do your research on their specific requirements before writing and submitting your business plan.

Need help getting your business plan together? Contact us today and schedule a consultation with one of our business plan experts!

The Best App Startup Growth
Strategy For Each Business Stage

The world is full of great app ideas – unfortunately, very few of them will ever reach the App Store. Even with a great business plan, the vast majority of new apps are bound to fail. And for the very few that do manage to survive the first year after launch, only a small fraction will ever reach financial success. According to Gartner, less than .01% of consumer apps that were available in 2014 were expected to become a ‘financial success’ by 2018. Some apps die because they are simply just a bad product-market fit; but often, app startups fail due to the lack of a sustainable startup growth strategy.

Everyone makes a huge deal about apps that made millions in profit, but we rarely hear about the tech companies that are barely surviving. Ken Delaney of Gartner said, “…of paid applications, about 90 percent are downloaded less than 500 times per day and make less than $1,250 a day. This is only going to get worse in the future when there will be even greater competition, especially in successful markets.” What does this mean for you as an app entrepreneur? It means that to become a dominating app today, you basically need to be a unicorn; and to succeed at all, you must have a strong startup growth strategy that allows you to rise way above the competition.

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What Is A Growth Strategy?

Let’s start from the basics. The definition of a growth strategy is a game plan for capturing a wider share of the market. For a more established business, this means diversifying product offerings, expanding into new regions and etc. A new startup however, must take a different approach to growth, first ensuring that they have built the right product and then identifying how to get even the first few users to their app. Another difference is, startups must rely mostly on internal growth strategies while established businesses that have enough resources can tap into external growth strategies for even quicker growth.

  • What is an internal growth strategy? An internal growth strategy refers to techniques that grow your business by relying on resources from within the business. These methods involve activities such as improving staff, optimizing marketing, and further developing the product offering.
  • What is an external growth strategy? An external growth strategy relies on external measures of growth such as acquiring another business or building a strategic alliance with another brand.

What is a startup growth strategy

External growth strategies can allow businesses to grow rapidly, but in the beginning, startups typically don’t have the resources needed to successfully implement these techniques. Acquiring technology takes money that startups don’t typically have, and strategic alliances often require a strong brand awareness and a highly-defined product – other attributes that startups don’t typically possess. Instead, startups must implement the right growth strategies at the right time to first acquire early adopters; then to establish the business within the market; and finally to scale wide and expand rapidly.

Startup Growth Strategies for Establishment

While you may envision having a million users on your application, the truth is, securing just the first 1,000 users is quite challenging. In your eyes, the app you’re building may seem like the only solution for the customer problem, but it probably isn’t. Today, there are more app solutions on the market than there has ever been, meaning your consumer has options. According to data by Sensor Tower, by 2020, there will be over 5 million apps active in the App Stores.

Image of Sensor Tower Quote about Startup Growth Strategy

When implementing a startup growth strategy, start by attracting enough early adopters to test your solution and ensure that you are building the right product for the market.

Identify Your Market

No matter how you choose to market or advertise your application, you will only succeed if you truly identify what market you are serving and who your consumer really is. One customer group may respond to your marketing efforts much differently than another, and the better you understand the customer – the more effectively you will be able to reach and serve them.

Here are a few ways to identify your target market:

  • Consider Your App’s Features: Think about the features that you are developing, and the benefits that relate to each of those features. Then, match them to the type of consumer that needs those benefits most. A productivity app startup for instance, may find that while they can serve a wide range of different businesses, web development teams would be most helped by the specific benefits that their features provide. With this insight, they can optimize their marketing campaign to attract this specific market.
  • Analyze Your Competitors: A thorough competitor analysis can provide great insight into which customer groups you should focus your attention on. On one hand, analyzing other apps with similar features will allow you determine what types of customers they are targeting and attracting. On the other hand, you may be able to find customer types that they aren’t focusing on – which may uncover market gaps that your team can take advantage of.
  • Develop Your Ideal Customer: Draw up a model of your customer. Give them a name. Write everything you know about them – where do they work, what do they read, how many children do they have, what is their annual income, who do they follow on social media, what type of apps do they download, what types of problems they face, and etc. Learn how they think and how they make purchase decisions. Identify what they don’t like about current products. Again – the more you know about your consumer, the better you will be able to reach and serve them.  
  • Justify Your Decision: After you have decided on a customer demographic and/or consumer group to target, perform market research to calculate how big the market really is. You will never penetrate the market by 100% and realistically, a successful app will likely only penetrate a small fraction of the total addressable market. If you were only able to secure 1% of your addressable market, would that be enough to sustain your business? Analyze your market thoroughly and determine whether there is enough value in your target market for you to continue to grow without limiting your ability to scale.

Find Early Adopters with an MVP

Launching your minimal viable product will allow you to test your software with early adopters for proof of concept. What is a minimal viable product? According to Techopedia, a MVP is “a development technique in which a new product or website is developed with sufficient features to satisfy early adopters.” In terms of your app, it means a stripped down software that only includes the features needed to prove that the concept is viable.

Instead of building a full-scale application with a large number of features, launch only the number of features that will allow you to validate your initial assumptions. Then, seek to bring in a handful of users and track how they behave. User behavior will give you the most valuable insight into whether your app solution is meeting the customer need in the way you expected.

Find Early Adopters with an MVP

How do you find early users? Here are a few tips to help attract early adopters to your solution:

  • Join Communities: The great thing about the internet is that like-consumers seem to find each other and organize themselves into awesome little communities. These communities are spread across different forums and even social media sites like Facebook and Reddit. The caveat is that these groups typically hate marketing spam cluttering up their discussions. Don’t approach these communities as a marketer, but become an engaged member of the group by asking and answering questions, and naturally interacting with other members. Once you become known as a valuable member of the community, it will be much easier to tell individuals about your application without seeming like an unscrupulous salesman.
  • Launch A Video: A great video has the potential to connect with the emotions of consumers and build wide scale anticipation for your app launch. Create an awesome video that showcases the features and benefits of your application and get it in front of potential viewers. In some cases, a video can be used to measure user interest before a single feature is even developed.
  • Social Media Ads: Social platforms like Facebook and Twitter allow you to get your marketing message directly in front of a targeted audience. Since you’ve already listed the demographics of your consumer, choosing the right audience to showcase your ads to should be simple. Continue to optimize your ads for better performance, and it will be much easier to get the ball rolling when you scale later on.

Track Metrics

Now that early adopters are downloading and accomplishing tasks with your application, it is important to track a variety of app metrics to best assess their behavior. Tracking metrics will give you the immediate data you need to determine whether your solution is a good product-market fit or whether it is necessary to pivot your solution. There are many metrics that will come into play at different stages of your business, but here are a few that you should be tracking from day one:

  • Number of Users: Is anyone downloading your app? Knowing how many users are downloading your app is the first measure of how well users are responding to your marketing message. If your marketing message is strong and you are showcasing features that truly serve your market’s need, you should be able to convert a good number of those who view your ads into downloaders. An app that is receiving little downloads (compared to marketing efforts) is typically either offering features that consumers aren’t interested in, or aren’t properly presenting valuable features in their marketing campaigns.
  • User Retention: It’s important that users are downloading your app, but it’s more important that you’re able to keep them around after you’ve acquired them. If you are successfully acquiring new users but they are only using the app once or twice before they delete it; this is a clear sign that an issue exists. This could mean that users aren’t satisfied once they download the app; or that they find it too confusing to navigate; or even that the app is too buggy for them to use effectively. The longer you are able to retain customers, the more value that you will be able to pull out of them in the long run.
  • Cost Per Acquisition (CPA): Acquiring new users doesn’t mean much if you are paying more to acquire them than they are worth. For instance, is it worth spending $50 to acquire a customer for a $2.99 app? Probably not. Tracking your cost per acquisition will keep you informed on what it costs to get a single customer to download your application. Once you have dialed in your marketing strategy and have created a great product-market fit, you should be able to improve marketing conversion; reduce your cost per acquisition; and increase your overall profit margin.

Develop Your Product

App development is never complete; and as you continue to learn more about your consumer, your app will morph to better serve the market. An app that never progresses in functionality will eventually reach a market plateau. Think about this – how many times does your smartphone notify you to update apps on your phone? Some of the most popular apps out there like Facebook and Instagram update regularly with new features and abilities.

Don’t make assumptions – use the data that you’ve collected in the previous steps to decide whether you are on the right path, or whether you should pivot your idea to serve your customer better.

Take Groupon for instance. When they first launched, the model was quite different than what it is today. Initially it was called “The Point”, and was a platform where people could get together to solve problems. After launching a simple WordPress blog and tracking user behavior, the founders realized that what people were really interested in – was grouping together to receive deep discounts on their favorite products and services. A pivot in strategy based on customer behavior data allowed Groupon to grow into the multi-billion dollar mega platform that it is today.

Product development is necessary across every growth stage. As you further develop your product, you will be able to attract more users, retain them longer, and acquire them at a lower cost.

Startup Growth Strategies

After a product has successfully passed through an initial stage of user testing and all immediate assumptions have been validated, startups can begin widening their startup growth strategy to increase user acquisition, consumer spend and internal capability. The following techniques can be used during this stage to bring an app startup to the next level.

Test Monetization Strategies

startup growth strategies - monetize app quote

 

The only way to become a financial success as an app is to monetize users. Even ‘free’ apps must have some type of revenue model (like advertisements) to sustain and grow. There are several types of monetization strategies, and finding the right app business model is critical to your growth as a business. Here are a few models you can test to generate the most value from each user:

  • Freemium: A basic version of the application is offered for free, but users can access additional features by paying a monthly subscription fee.
  • In-app Purchases: The app can be downloaded for free, but some type of virtual goods can be purchased within the app. Mobile games often use this model, allowing users to purchase additional credits, coins or virtual items.
  • Advertising: Users can access the application for free, but advertisers are charged to display ads to these users.
  • Paid Apps: Users are charged an initial fee to download the application.

Optimize To Convert Better

It’s important to acquire customers, but what’s more important is being able to convert them into paying customers. Unfortunately, startups often don’t pay enough attention to or put enough effort into converting users into customers. According to HubSpot, for every $92 spent acquiring customers, only $1 is spent in converting them. If you can’t convert users into customers, it will be impossible to earn enough revenue to maintain growth. As is the case, it is vital to optimize conversions before scaling your marketing campaign; ensuring that you are growing your revenue potential as you grow your number of users.

While the technique you use will be specific to your individual business, here are several common ways that app entrepreneurs have effectively improved their conversion rates:

  • Free Subscription Trials: In some cases, freemium users may not upgrade to paid subscriptions because they don’t understand the value of doing so. Maybe they are able to fully satisfy their need just from the free version, or maybe they are just confused as to whether the upgrade is worth their money. Offering a free month of subscription will allow them to try the upgraded package with no risk, and access additional features without any payment. Apps that offer free trials acquire significantly more sign ups to their paid packages and typically have a much higher conversion rate than apps that do not offer a trial period.
  • Discounted In-App Purchases: For apps that sell in-app goods (like mobile games), offering limited time discounts is an extremely effective way of increasing conversions. Games that allow you to buy coins or credits for instance, are known to frequently push notifications to consumers during usage; offering a high number of credits for a discounted price – but only if you capture the deal now. Just like in a convenience store, consumers who engage heavily with mobile games are more likely to buy on impulse when a discount is involved. Furthermore, by offering a discount, you may be able to convert users who would not have purchased otherwise.
  • Pricing Optimization: In some cases, users may not purchase larger subscription packages simply because they don’t like the price. Optimizing your pricing is critical – charge too much and users won’t purchase, but charge too little and you may kill your profit margin. Run A/B tests on your packages, trialing different pricing structures against each other to find the ideal balance between customer value and price.
  • Feature Optimization: If users don’t find enough value in the additional features offered in upgraded packages, they’ll simply continue to use the free version. Consider the features that you are asking them to pay for, and the ones that you are offering for free. Confirm that there is a considerable value added each time the user upgrades to a higher package; and furthermore, verify that each upgrade helps them solve their problem more effectively than the less-costly or free packages.

Generate Referrals

One of the best ways to grow at any stage is to tap into the networks of your existing users through referrals. According to reports by Nielsen, 92% of consumers trust recommendations from family and friends above all other forms of marketing. No matter what your marketing message is, it is exponentially more effective when your consumer hears it from someone that they trust, as opposed to when they hear it from you as a marketer.

In today’s online world, users love to share – that is, if something is worthy of them sharing with their peers. Take advantage of this by offering user incentives for recommending your app to their friends, family and associates. Referral marketing isn’t just one of the most powerful methods of marketing, it is also the most fruitful. This means that by compelling your users to refer your app, you can acquire several new users for the price of one.

Build Your Team

Don’t underestimate the value of an awesome team. Great strategies bring in valuable users, but it’s the team that forms and implements the strategy. Take an objective and subjective look at your current team – and the skills that they possess. Compare existing skills to those that are really needed to push your startup forward. When you find gaps, fill them in with the right people. As a result, you will strengthen your team, build your internal capacity, and leverage the abilities of other specialists to get to the next level of growth.

Startup Expansion Strategies

At this point, you should have a large number of users, a proven product, a winning marketing strategy, an app business model that converts well and a strong founding team. Now, you should be able to access external resources to expand the application or launch it into new markets. Here are a few techniques that can be added to your startup growth strategy in the expansion stage.  

Secure Funding

If you’ve penetrated enough of your initial market with a proven solution – you’ll likely be in a strong position to secure seed funding from an angel investor. Write your app business plan, create an awesome pitch deck and network like crazy. Pitch your idea everywhere you can and to everybody that will listen. You never know who knows who, and ‘six degrees of separation’ is more real than you could ever imagine.  

Joining an app incubator is also an effective avenue to raise funds for your software business. In addition to funding, these entities also typically provide advice, office space and even connections with potential investors and customers within their network.

For more information, check out our article: The Best Ways To Raise Seed Funding For Your App Startup.

Build A Great Marketing Funnel

Unfortunately, not every consumer who needs your app will realize they need it the first time they see your marketing message. At the time they see an ad for your app, they may not yet need the solution; or may not realize that they need the solution; or may not realize that they need your solution. Building a great marketing funnel allows you to capture consumers across all purchasing stages and funnel the most qualified leads into customers.

startup growth strategy - marketing funnel

Fully examine each stage of the marketing funnel and determine whether your funnel best serves the customer at every step. Focus on on strengthening any weaknesses. For example, you may find that you are losing customers in the consideration stage, because when they search your app online they don’t find anyone talking about it. This may mean you need more press or that you need to showcase your app on more online outlets. As another example, you may find that users downloaded the app but often leave at the sign-up stage because the process is too lengthy or difficult. A strong app marketing funnel ensures that you are able to best serve a customer from the time they discover your app until the day they become a customer – and beyond.

Scale Your Business

Finally, you are in the position to really scale your business. With financial backing and a strong marketing funnel in place, your startup can leverage this foundation to grow even further — and even faster. There are several ways to expand an app business once it has been proven and validated, such as:

  • Seek New Audiences: Once you’ve successfully penetrated your initial target audience, start looking other market sectors that may benefit from your technology. Preferably, look for niche markets that your competitors are not serving – which will give you a major competitive and first mover advantage.
  • Penetrate New Locations: Many app startups have realized the extreme advantage in initially targeting one specific location. After you have figured out how to effectively penetrate one particular region, it is highly likely that you can duplicate the same strategy to quickly penetrate new locations. Seek locations that are similar to your launch region – locations where you can reach the same consumer demographic and attract them the same way you did previously.
  • Add New Features: Finally, as you are building your user base, you should also continue to seek opportunities to further monetize your existing users. By adding new features and functions to your technology, you can create new revenue streams and add more product value; enticing users to stay on your app longer, return more often, and spend more over their customer lifetime.

A strong startup growth strategy is integral to your success, and if the optimal strategy is followed, you will be able to set yourself apart from the dozens of competitors that you will likely compete against over your journey.

At ThinkLions, we have worked with hundreds of businesses around the world, helping them develop and implement startup growth strategies that win. If you have an awesome app idea or a soon-to-launch app, we’d love to help you develop a step by step startup growth strategy and business plan. Contact us today to set up a free consultation with one of our app startup experts.

Startup Valuation: What Is
Your Pre-Revenue Startup Worth?

For a pre-revenue startup, calculating a startup valuation can be confusing and challenging. From the founder’s point of view, they have an awesome idea, a minimal viable product and some traction – and if you ask them, their app has the potential to serve millions of users and create billions of dollars in revenue. Ask a potential investor to evaluate the same startup, and they may see an unproven revenue model and a startup team that has little to no experience.

In the early stages, a startup’s true value is likely somewhere in the range of: lower than what a founder hopes it to be, and higher than what an investor is hoping to pay for a portion of equity. When revenue is not in play, there are many other factors that become more important to calculating a fair startup valuation, and many of these factors can be quite subjective.

What are these factors? When it comes to a pre-revenue startup valuation, what do investors look for? How do you secure an investment for your startup when you haven’t yet produced any sales? In this post, we want to find the answers to these questions and show you everything you need to know to prepare the best startup valuation when seeking investment.

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Why Is Valuing A Startup So Difficult?

Negotiations between an investor and a startup can be tense. On one end, founders approach the situation hoping to raise the largest amount possible while offering the lowest amount of equity. On the other end, investors are looking for the best deal – invest the least amount of money and receive the largest percentage of equity. While these type of startup and investor deals make headlines, really they are no different than any other transaction – a seller wants the highest value for their offering, while a buyer wants the best product or service for the lowest price.

When investors invest in a company however, they are buying into the future value of a company; and using previous and current value to assess how high that future value may be. For an established company, investors can look at financials over several years and use historical data to predict the future performance of a company. Early-stage startups don’t have historical financial data though, and value must be assessed by examining other important factors. Investors have to be especially realistic about the value and potential of a startup; on average, 75% of venture-backed startups don’t make it far enough to return cash back to the investor.

There are many different elements that can be considered for a pre-revenue startup as a proof of potential; but really, which factors are most relevant and which are weighed most heavily is highly dependent upon the type of business itself. A social media app, for example, may be able to garner a high startup valuation solely off of a large user base – while a B2B SaaS solution may need to prove their potential by showcasing long durations of user sessions and a high percentage of conversions to paid subscription packages.

Through our discussions with several investors, CPAs and other financial parties, we’ve narrowed down the three most important factors for a high pre-revenue startup valuation – a strong founding team, proven traction, and a viable future financial projection. In the following sections, we will examine each of these factors, explain how they relate to value, and teach you how to strengthen these factors for a better startup valuation.

The Value of a Founding Team

For a pre-revenue startup, one of the greatest predictors of success is the strength and experience of the founding team. A team of founders that have a history of bringing other startups to success, for instance, would be more highly valued than a team of first-time entrepreneurs with little experience. Furthermore, a team of four people with diverse and focused skills would typically provide more value to a startup than a single founder team.

Mike Raab, investor at Sinai Ventures in San Francisco explained exactly why a strong founding team is so important when he considers investing in a startup. Mr. Raab explained, “At an early-stage company, the most important factor that investors consider is the startup team. Does the team have demonstrated success and experiences that make them uniquely qualified to build a venture-scale business in this sector? Ideas are frankly very common (there are often many different companies building similar products to solve the same problem), and investors look for the team that has the background and knowledge to perform and outlast the rest.

How strong is your founding team? Here are a few attributes of a valuable team:

  • Proven Experience: Investors want to know that a startup team has what it takes to succeed. Startup founders that were previously involved in other successful startups are immediately valued higher than founders with no experience. As an extreme example; if Mark Zuckerberg walked into an investor’s office, his reputation would most likely precede him. His past success with bringing startup ventures to the top would be extremely valuable to any new business he participated in. However, it’s not just those with a successful entrepreneurial background that are valuable to a business. A developer that had a significant position at a well-known software company may have an advantage when developing his own software. A successful financial manager may have an advantage when pitching a financial solution since he has unique experience within the industry. How one’s experience can benefit a specific startup is subjective – but experience plays a major role in the way an investor perceives the associated risk of a startup.
  • Skills Combination: A startup team should consist of several individuals, who each have a different but complementary skill set that can help progress the startup. A programmer with no marketing background may benefit from having another programmer as their partner; but the team could be much more effective if he/she partnered with an experienced marketing expert instead. Identify what skills are necessary to scale your startup and seek to fill in those gaps to increase your team’s overall value.
  • Commitment & Dedication: Having a great founding team means very little if none of the team members are actually available to execute the required work. For example, a developer that is involved in multiple projects may have very little time to allocate to building the software – and while they may be a valuable member, their involvement is devalued by their time limitations. Build your team with highly-motivated individuals who are committed to bringing the startup to success.
  • Advisory Board: It’s not just your founding team that is important, but value can also be found in people who advise the board when making important decisions. Experienced advisors can help startups avoid obstacles, help them make more informed decisions, and can even introduce them to potential investors or clients within their network. Look for mentors you can lean on – successful entrepreneurs, industry leaders, and individuals who have the knowledge to help you in your mission.

The Value of a Founding Team

How much is an awesome team worth, exactly? Well, it’s not quite that clear cut. According to Ken Stalcup, CPA at Houlihan Valuation Advisors; it’s not the team itself that adds the value, but the revenue that those members can generate as a result of their experience. While telling us the process of calculating startup valuation, Ken told us, “We definitely consider the potential for the startup team, their experience, their expertise and so on. [However,] we wouldn’t typically associate a particular value for the startup team; rather, the startup team would be a factor considered when determining the potential growth and quality of future revenues. The better the team – the better the prospect for future revenues.”

Traction is Proof of Concept

When it comes to startup valuation, traction tells the true story of the business – and it doesn’t always come down to revenue. Mike Raab explained, “If a company can organically (without paid marketing) acquire a significant number of users, or demonstrate very low CAC (Customer Acquisition Cost) compared to the potential LTV (Lifetime Value) of the customer, the unit economics are more favorable for venture investors.” In other words, what really brings value to a startup is proof and evidence that an idea is viable and scalable to a large market.

Which metrics you use to prove effective traction will be specific to your startup; however some of the most important app metrics for startup traction include number of users, a proven app marketing strategy and a strong growth rate.

Number of Users

A solution that has acquired a large number of users (compared to the size of it’s addressable market) will have a higher valuation. By securing a large quantity of users, startups can prove that they are able to attract consumers, that users are satisfied with their product, and that there is an existing network that can be monetized.

What does a large number of users look like in solid numbers? Obviously, it’s not that simple. The goal is to penetrate the addressable market, but not all markets are equal in size – and therefore, what seems like “many users” for one app solution, may seem like very few users for another. For example – A solution that serves a large portion of the market, like a social media app, may need 100,000 users to make an impression; while a B2B solution that monetizes consumers with a monthly subscription may be able to show exceptional traction with only 500 paying users.

Having a large user base is a major accomplishment, but what really matters is how those users behave once they have downloaded your application. A million users sounds amazing if that is the only information given – but is it still amazing if 998,000 of those users never returned to the app after using it once? In this situation, having a large user base actually hurts value and shows that a major flaw exists. When considering the number of users during your startup valuation, consider the whole story by analyzing a variety of user metrics such as user retention, daily and monthly active users, session length and more.

Traction is Proof of Concept

In terms of the value of a user base, Ken Stalcup commented, “The value of current users is similar to the overall value of the company. That is, we typically want to see a projection of the revenues associated with the existing users. From there, annual cash flows from current users can be calculated and a present value can be associated with that income stream. Obviously, as [the number of] users grow, there will be more value. If users are anticipated to decline, value will decline.

Effectiveness of Marketing

As Mike Rabb mentioned, a startup that has proven its ability to acquire high value customers at a low cost has a major advantage when seeking investment. Even if current users have not yet been monetized, showing that a strong marketing strategy has been identified and optimized has the potential to increase startup valuation significantly. Taking a small marketing budget and generating a substantial number of users (in comparison to acquisition costs) proves that with a larger budget, the startup would be able to scale its user base exponentially with little risk.

Growth Rate

What makes a large existing user base even more attractive? Knowing that it’s going to keep growing and growing in the near and distant future. A history of incremental scale and growth, even if small, can add considerable value to your startup. If you can grow consistently with a small budget, the potential is great that you will be able to scale larger and at an accelerated pace with the investment of an angel or VC.

Here’s the key to gaining traction. These three concepts are interconnected – a super effective marketing strategy leads to strong growth; and when your growth is strong, your user numbers inevitably increase. Figure out the first things first – build a great solution that is in demand by your market and learn how to get it in front of your consumers at a low cost.

How Valuable Can Your Startup Become?

While there may not be a hard monetary value on each of the factors we explained, all of them fit into the overall value of a startup. Hard metrics like number of users, customer acquisition costs and per customer monthly spend can be directly accounted for in a financial projection – but intangible assets like founders’ experience provide a measure of confidence that the projections can actually be reached, and this is equally as important.

Ken Stalcup gave excellent advice into how his firm typically calculates a startup valuation: “To put a value on a tech startup, we would typically want to see a five-year projection of the company’s future revenues and expenses. Using those projections, we would develop an estimate of the annual cash flows, add all of the estimated annual cash flows together and calculate the present value of that total number. Pre-revenue startup valuation is accomplished by calculating the present value of the estimated future income stream of the company.”

The Perfect Mix For The Best Startup Valuation

What does a valuable pre-revenue startup look like to an angel investor or a venture capital firm? Mr. Raab explained why his firm, Sinai Ventures, recently decided to invest into a startup called Kapwing“In July, Sinai Ventures invested in Kapwing, a free software tool for intuitively creating and editing video content and memes. While the company had some revenue, it wasn’t of material scale. However, the co-founders had a clear product vision and had built an impressive user base completely organically in just a few short months. Their backgrounds, traction, and expertise & excitement about what they were building made it an easy decision for us to invest.”

When a startup gets funded at a high startup valuation, it’s typically because they have the perfect mix of positive elements that prove the likelihood that the startup will succeed and generate a substantial return. When you can easily prove that your startup possesses all the pieces needed to achieve grand success, the value of your company will increase and you will be better able to calculate a fair financial ask and equity offering.

Mr. Raab gives the following advice for startups that are seeking investment at the highest valuation: “Get your product in front of customers, get their feedback, and iterate until you have customers who love your product. Product-market fit doesn’t necessarily mean revenue – it means demonstrating that there is a core user for your software who loves what you’ve built and is willing to pay for it (in one way or another). If you have customers willing to provide reference calls on your behalf to tell investors why they love your product, why they’re willing to pay for it, and why it’s better than the competition – investors will take notice.”

Need help creating financial projections to better assess your startup valuation? Our experts can help. At ThinkLions, our business plan writers and consultants have worked with hundreds of startups around the world – creating app business plans and pitch decks that have helped raise millions of dollars in investment. Contact us today to discuss how we can help you bring your app startup to life!

How To Come Up With
The Right Name For Your App

For most of us, our name existed even before we did. In anticipation of our arrival, our parents went through an ultra stressful process of narrowing down dozens of potential names until they chose the perfect one. Luckily they did, because whatever your name is, it has followed you throughout your entire life; and in some cases, people may have heard of your name before they’ve ever met you. When it comes to how to name an app, it’s of similar importance as naming a child. The name of your app will follow your brand forever, and in many cases, potential users will hear the name before they ever actually use your app.

Naming an app isn’t as easy as it sounds – and knowing how to name an app effectively can separate your app from other competitors. Sure, “Google” sounds cool now, but 20 years ago, who ever would have imagined that it would be a name we use every day? Now, when someone says “Google”, everyone around the world knows exactly what it means. The name overcomes language barriers, age barriers and every other barrier – no matter where you are in the world, “Google” is a name that everyone knows.

But how do you come up with such a clever name for your interesting app? How do you choose a name that sticks like Google, Facebook, Twitter or Evernote? To inspire you to create a name that really represents your app, we talked to several app developers and entrepreneurs, and asked how they came up with their app names. If you’re wondering how to name an app, here are the tips you need.

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1. Reflect Your App’s Core Features

Many successful apps choose a name that describe what the app does. Just by hearing the name, you know that WeChat is a messaging app or that Netflix has something to do with video on the net. Sometimes, users will judge your app immediately based off of a first impression and without reading your app description – having a name that explains the features of your app can give you a major advantage in these cases.

Brian Swanson, co-founder of Inspironto, told us the story about how his founding team came up with the name for their app, QuestionAir:

“We were talking about how fast the app sends questions from the poll manager’s iOS device to the respondent’s smartphones (because it doesn’t depend on backend servers). Someone said it felt like we were sending questions through the air – and that’s how we came up with the idea to call it: QuestionAir.”

The name of your app doesn’t have to be extremely clever. Sometimes, clever can be complicated. A simple name is easy to remember, and makes it easy for consumers to understand what the app is all about. Ionuț Mănășturean, the founder of Mini Games told us, “The name of our app, Mini Games, is simple and easy to remember. I picked this name because I wanted to express that our app has many mini games to play. When we looked at our competition, we realized that the first ranking app for the ‘mini games’ keyword was an app that was only in Russian. I saw this as an opportunity, so I began working on an English mini games app. As a result of choosing the right name, our app is now ranked first for the ‘mini games’ keyword in the app store.

2. Differentiate Your Name With A Play On Words

Sometimes, a play on words can provide you with the perfect app name. Take the app, Free Map Israel. This crowdsourced map application changed their name to Waze in 2008; a play on the word ways, which was perfect since the app represents the vast number of ways that an individual can get to a specific location.

Aggrey Ellis, Director of Customer Experience at Gopher Leads, shared with us the backstory of how their app name was created. He said, “We created a simple mobile app that allows employees to earn extra rewards by referring sales and other opportunities to their company. Gopher Leads, sounds like ‘Go For Leads’, as we try to convince employees to rally around and ‘go for’ sales.

Maybe you can’t get the exact word that describes your app, but differentiating slightly can give you a memorable twist and open you up to more options. There’s a caveat here though, if you get too creative, you may make it harder for users to find your app. If users are searching for Ways, it may be difficult to find Waze if they don’t remember that the spelling is different.

3. Keep It Short and Memorable

A long name with several words and many characters is an surefire way to ensure that users forget the name of your app. Ideally, you want a short name with a minimal number of characters that is unique and memorable. Skype, SnapChat and Tinder are all billion dollar apps that have short and memorable names. Not only are these names easy to remember, but they are also easy for users to communicate when recommending them to their peers.

Yusuf Motiwala, founder and CEO of Mesibo, told us about how he came up with the name for his app. He told us, “We were trying to come up with a name for our new messaging startup, the requirements being – it should be unique, easy to pronounce and spell, have association with messaging, be one word and less than eight characters. As simple as that sounds, finding a name with those criteria became an almost impossible exercise. Despite extensive days of brainstorming, we were unable to come up with a name that was convincing and that met our criteria. One day, one of us suggested that since we have both voice and video as core features; we should think ‘beyond messaging’ to search for a name. This became the tipping point in our search for the right app name. The name ‘Mesibo’ was derived from picking letters from the phrase ‘Messaging and Beyond’.”

4. Make Your App Name An Action Word

While these words may not be in the dictionary, we all know what it means when someone says “Google it” or “Skype me”. In many cases, you know you’ve reached success when the name of your app becomes an action word. One major tip when learning how to name an app – consider how your app sounds in everyday speech and how it flows with normal language.

Lori Cheek, founder and CEO of dating app, Cheekd, has a funny story about how she came up with her app name. Lori told us, “Growing up with the last name Cheek was kind of a pain in the butt (excuse the pun), but it finally came in handy. For weeks, I was racking my brain about the verb that was going to finish the statement, ‘You’ve Been ______.’ and then one day it hit me. You’ve been ‘Cheekd!’ The word is now in Wikipedia and the funnier thing is that a few years ago, I was on ABC’s Shark Tank… my epic episode re-airs all over the world all the time and I recently got this random email: “Did you ever wonder how different your life would have been if your last name was Smith… or Johnson… or Bennett?’ and yes, I have!

5. Choose A Name That Is Searchable

Sometimes, a name can be chosen because it fits the entrepreneur’s goals for marketing and customer acquisition. Consider the fact that 63% of smartphone users discover apps through the app store; searching specific keywords to find an app that solves their customer problem. Since such a large portion of downloads are a result of searching, it is a wise decision to choose a name that aligns with the keywords that are being searched. For example, the app LiveAuctions aligns perfectly to what consumers are likely searching for – live auctions. Not only will they likely rank higher than other auction sites that have less-aligned names, but customers will know exactly what the app is about as soon as they read the name.

Newaz Chowdhury, the Marketing Manager at Powerphrase, recently told us how they came up with the name for their mobile game – Trump’s Great Wall of America. Newaz said, “When you pick a name for an app, you want to make sure it has keywords that people are searching for in search engines and the mobile app stores. For us, we looked at our competition to see what apps were showing up when you searched particular keywords. We found that the words ‘Trump’, ‘Great Wall’ and ‘America’ all had significant search volume. As a result, we chose our name. This was also around the time when Matt Damon’s movie, ‘The Great Wall’ released – and as an additional benefit, ‘Great Wall’ is also an extremely popular search term in China. As a result, we received a spike in downloads from China and elsewhere – leading to consistent traffic and downloads.”

6. Align It With A Domain

Most likely, you will want to have a landing page that corresponds with your mobile app. Try to choose a name that is available, but that also has the same name available as a web domain.

Saurabh Jindal, founder of Talk Travel, told us about how domain availability factored into his decision for an app name. He told us, “TalkTravel is a voice mobile application that enables travellers to speak, in their own preferred language, to destination experts. For us, we wanted to convey the idea of travel and talk to make travel simple. We also wanted something seemingly easy to remember and that sticks in people’s mind. It came down to a choice between Travel Talk and Talk Travel; but, the Travel Talk website domain wasn’t available. Hence, we decided to go with TalkTravel.

Patrick van der Mijl, co-founder of Speakap also chose their name as a result of domain availability. Patrick told us, “It was a rainy Sunday when we did our research for a business name eight years ago. The choice for ‘Speakap’ boiled down to domain availability; our criteria was that the name had to be short, simple, and related to communication. Speakap made sense, because we enable employees to be heard.

7. Pick The Obvious Name

Sometimes you don’t need to choose a name, because the right name may just choose you. Tasker, for instance, probably didn’t put a whole lot of thought into creating a unique name – Tasker made sense and is a pretty obvious choice for an app that helps you manage tasks. Likewise, theScore is a pretty obvious app name for a sports score app. In many cases, the obvious choice fits the criteria of many of the previous tips – it will likely reflect your core features, it’ll likely be searchable, and if it truly the obvious choice, it’ll also be memorable.

Cody Swann, CEO of Gunner Technology, told us the story of how the name of his app uConsent came to be. He told us, “uConsent is an app that acts as a digital handshake between two people and is designed to foster interpersonal communication around sexual intimacy while creating an anonymous and secure record of that communication, including location, time and specifics of the request. In this case, uConsent was an obvious choice. In fact, most of the time the name is obvious if you think about it long enough, but it’s important to let the name produce itself naturally.

8. Connect With Your Consumer’s Emotions

There’s something about a name that pulls on our heartstrings or evokes a certain emotion from us – and when it comes to how to name an app, an emotional name may give you the edge that you need. Take MyFitnessPal, for instance – it’s not just another fitness tracking app but it’s also your pal; someone you can depend on to hold you accountable to your fitness goals. Family Locator, is another app name that immediately pulls on the emotions of users. It immediately makes you think of the possibility of not being able to locate your family and gives you immediate incentive to download.

Zach Hendrix, co-founder of GreenPal told us a similar story of how they came up with their app name. Zach told us, “We wanted our mobile app’s name to invoke a personal response from our users. When you are looking for a lawn care service, you usually ask a friend or family member for a recommendation. So we decided to combine the color of green grass with the feeling of getting a recommendation from your friend, or family, or your pal. After brainstorming for weeks, we landed on GreenPal and it has stuck.

The Most Important App Naming Tip

While all of these tips are extremely important in learning how to name an app, here’s one tip that’s more critical than all the rest – make sure your app is as good as your app name. There’s nothing worse than clicking upon some really awesome sounding app, only to be disappointed by a not-so-awesome software solution. When you choose your great app name, make sure it truly represents a great app.

As always, we’re here to help you build awesome apps. We’ve helped dozens of startups around the world to develop innovative and market leading technology – and we’d love to help you introduce your app idea to the world too! Contact us for a free consultation with one of our app startup consultants to learn about how we can help you bring your app idea to life.

11 Ways To Ensure
A Successful App Launch

To the masses, it may seem like successful apps just pop up one day and achieve magnificent success without much effort. However, anyone who has ever launched an app before knows the truth – a successful app launch takes serious work and getting people to your app is not easy.

While a great app idea may start at a hackathon, most apps aren’t built overnight… or in a week… or within a month. According to a study by Goodfirms, it takes an average of 3-5 months to fully build out and launch a mobile app. Why does it take so long? An app launch doesn’t just rely on how quickly your app developers can code it – but also includes many other steps like customer research, concept validation, pre-launch marketing, and more.

To build a successful startup and experience a strong app launch, there are many factors that need to be in place before, during and after you push your app to the app stores. If you’re just starting development today, you’ve got at least 90 days to get everything together before launching. In this guide, we’ll guide you through each step that you need to take as you approach the day of your app launch.

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Phase I – 90 Days Before Your App Launch

Phase I - 90 Days Before Your App Launch

Three months before the official day of your app launch, you should already be setting the foundation for a strong launch. More specifically, you should be focused on validating your app idea and laying the groundwork for your marketing and branding.

Validate Your Assumptions

Before taking on the expensive journey of building a new piece of software, it is critical to validate your concept; proving that there is actually a market experiencing a specific problem, and that your product is the solution that the market is looking for to solve that problem. Not every app startup will change the world like Facebook or Uber, but there are thousands of highly successful apps that simply solve a small problem for a large number of users.

True market disruption comes when a founding team creates an app that solves a problem that no other solution exists for. However, you don’t have to be the first to market to succeed as an app startup, you just need to solve the problem better or more effectively than other competing solutions. Consider how some of our favorite apps solve our largest problems:

  • Uber solved transportation problems for citizens, making it easier to procure a ride without waiting on a taxi. Furthermore, Uber made it simple for the average person to earn extra income by monetizing their automobile and free time.  
  • AirBnb simplified the property booking process by giving easy access to short-term rental options outside of the traditional hotel. Furthermore, it made it easy for property owners to earn an income without a long-term tenant, by monetizing their property through the platform.
  • Tinder didn’t solve a new problem. Online sites like Match were already leading the market – but they were expensive to use and was a huge commitment for the average person looking to casually date. Tinder made it easy for singles to mingle with other singles by literally bringing dating right to their fingertips. A simple swipe of the screen can generate a new dating relationship without the huge monthly commitment of other dating solutions.

Believing that your concept is the best solution for your market isn’t enough. Your ‘belief’ can quickly lead you to blowing through your development budget only to find that your audience doesn’t believe in your solution as much as you do. There’s something that’s better than great assumptions – validation through real data. No matter what, you will validate your app – you’ll either validate it early on, or you’ll use all of your resources to build it and then validate that there is a major flaw when no one downloads it. Successful apps are able to validate their assumptions early on and pivot where necessary to ensure that they are building the type of solution that is truly in demand by users experiencing a specific problem.

There are several ways to validate an app idea, including:

  1. Smoke Tests – The purpose of a smoke test is to determine buyer intent as cheaply as possible. In practice, a smoke test gives the impression that there is a product to be purchased, even when the product hasn’t actually been built yet. An example of a smoke test could be a landing page that explains the functionality of an app, displays several design screens and allows users to ‘purchase’ a subscription. The ‘smoke’ part of the test is that there is no product to be purchased, because it doesn’t yet exist. This allows startups to test how many people would be interested in the application if it already existed; giving them immediate clarity on whether it is worth it to go forward in building out their app concept. Smoke tests can be built and executed rather inexpensively, but can provide an incredible amount of insight to make your app launch more successful.
  2. Crowdfunding – Platforms like Kickstarter and Indiegogo give startups the opportunity to pre-sell their product or service and raise the funds to build it. Pre-selling is a great way to prove demand for your app before it’s official launch. App startups that are able to crowdfund successfully have an additional advantage since they are usually able to generate enough capital to build at least an initial minimal viable product (see below), are able to build strong brand awareness, and are able to sign up thousands of customers months before their app launch.
  3. Minimal Viable Product (MVP) – Launching a minimal viable product is another excellent method for proving your concept and validating your assumptions on all aspects of your application. A minimal viable product is a stripped down version of the product that only includes enough features to satisfy early users. In terms of apps, a MVP will be a real and launched application, but stripped down to only its core features. This allows developers and app startups to launch their software quicker and with a smaller budget, but be able to attract early adopters in order to generate insights and feedback. Instead of spending tens or hundreds of thousands of dollars to build a full-featured app that may or may not succeed in the market, an MVP only includes very few features to test interest and usage behavior before developing further features.

Lay The Groundwork for Branding & Marketing

Marketing is critical to the success of any startup, and you don’t actually need a launched product to start communicating with your audience and building brand awareness. If your plan is to wait until your app is already on the market before you decide to begin building the foundation for your branding and marketing, you will be seriously behind the ball on the day of your app launch.

Ninety days before your app launch, take the following steps to build a strong branding and marketing foundation:

  • Buy a domain and launch your website: At some point, your app will need a website, and the sooner you launch a site that explains the features of your upcoming app, the quicker you can start building up anticipation from potential users. A website for your app gives you many benefits – you can offer pre-registration, showcase demos of your application, generate feedback and use it to launch a content marketing campaign. Furthermore, setting it up early ensures that you align your app name and website domain.
  • Create all your social media handles: Marketing through social media is one of the most effective ways for app startups to reach their audiences. Lay the foundation by creating all of your social media handles on the various social platforms such as Facebook, Twitter, Instagram, Pinterest, Reddit, and others. Even if you don’t think you’ll use a certain platform, having your app’s handle there ensures that if you ever change your mind, you will already own the appropriate handles.
  • Become part of the community: If you know exactly who your target audience is, it isn’t hard to find them. In many cases, your audience has probably already organized itself into a community on a platform like Facebook, LinkedIn or Reddit. Become active in these communities and groups; but don’t start immediately advertising your app and annoying everyone. Instead, engage with them – answer their questions, get in on the action, learn about their likes and dislikes, and identify their complaints about your competitors. These groups are a highly valuable source of market research, and after you establish yourself as an expert; advertising your solution will be perceived as an expert recommendation instead of an annoyance.

Phase II – 30 Days Before Your App Launch

If you’ve been building your app according to lean startup principles, you should have some core product built for testing with early adopters – even before the full app that will be launched to the public is completely developed. Thirty days before your initial launch, you want to start testing your software to validate your assumptions and kicking off your marketing plan. Here are several steps that should be taken a month before your app launch date.

Submit MVP To The App Store

Even though your full-version app may not be ready, you should still submit your minimal viable product (core-features only) to the appropriate app stores. Be sure to take a look at all the guidelines for both the Google Play Store and the Apple App Store to make sure your app meets their submission guidelines.

Submit MVP To The App Store

Why submit your app 30 days in advance? There’s a chance that your app may get rejected by either store. If this happens, you’ll have a 30 day buffer to make the necessary changes and get it resubmitted before your app launch date arrives.

Invite Beta Users For Testing

After your app has been successfully submitted to the appropriate app stores, launch it in beta – an initial private launch that allows only invited guests to access, download and use the application. Fortunately, both app stores (Google and Apple) allow developers to invite users to test their apps before officially launching it.

Don’t launch your app without beta testing it first. A beta test is basically a dry run that allows you to test each feature, discover any bugs, and gain valuable feedback from your users. Furthermore, it will help you identify any final improvements you need to make before the official launch and will help you earn some initial reviews.

How do you find initial beta users to invite? If you’ve completed the previous steps, you’ll already be in the right position – you will have a list of pre-registered users from your website, as well as an expert presence in several communities and groups. People who need your solution will be more than happy to be invited as a beta user, you just have to let them know that the opportunity exists.

Kickstart Marketing Activities

What does a failed app launch look like? It’s when you’re anticipating your launch for a whole month, and then on the day you launch, not a single user downloads your app. It can be a depressing day for those who are not prepared. Due to this, it is essential that you kick off your app marketing activities early on to start building up brand awareness and anticipation throughout your market. Here are three marketing activities you can focus on thirty days before your app launch:

  1. Create Marketing Materials: Ideally, you want to have strong marketing assets ready to go on the day of your app launch. It takes time and effort to optimize a marketing campaign for ideal conversion, and time will be wasted if you wait until the day of your app launch to start producing your marketing materials. Focus on high converting assets like the content for your app’s website landing page and creating engaging promotional or explainer videos that will draw interest from consumers.
  2. Develop and Market Your Content: Many app startups fail to take advantage of one of the most effective marketing strategies out there – content marketing. Developing great content has two major advantages. First, it allows you to establish your brand as a leading industry expert. Second, if optimized correctly, content can help you rank for important keywords on search engines like Google, which can drive organic and free traffic directly to your application.
  3. Optimize Your App Store Listing: According to Forrester, 63% of apps are discovered through app store searches. Just like ranking on Google, ranking highly in the app store can bring significant traffic at no cost. Optimize your app listing using ASO best practices to ensure that potential users can find your app when they are looking for a great solution.

Phase III: 7 Days Before Your App Launch

 Days Before Your App Launch

A week before your app launch, you want to start building anticipation amongst your audience. When users are excited about a new app release, they will rush to download it as soon as they are able to. Facebook, for example, first launched to a single university, and slowly spread university to university. Each university knew when it was coming and students anticipated the day that they could join in on the platform that all of their friends at other universities were talking about. As soon as Facebook opened up to a university, it was quickly adopted by a large portion of that school’s student population.

Likewise, you want to build anticipation for your application and get the word out that your app launch is coming soon. Here are a few ways to start spreading the buzz about your upcoming app launch:

Build Strong Media Relationships

One of the quickest and most effective ways to gain the trust of an audience is to gain the trust of people that they trust. Sure, you can acquire customers by persuading them one-by-one; but media and influencer relationships allow you to immediately reach pre-existing networks with the backing of a credible source. Building strong media relationships can be a difficult task, and it takes some practice to learn how to reach out to influencers and journalists successfully. Many businesses choose to hire Public Relations agencies who already have contacts so they can gain coverage sooner. Whether you hire a PR agency or choose to do it yourself, here are a few tips to getting your app mentioned by the right people, shortly before the day of your app launch:

  • Contact Influencers –Look for individuals that influence your market; whether they are on Twitter, YouTube, Instagram, or anywhere else. An influencer is someone who possesses enough power to sway the purchase decisions of individuals who follow them. ‘The Oprah Effect’ for example, is a phrase that was coined to explain the influence that Oprah Winfrey had over her viewers for the last couple of decades. A simple mention on her show immediately transformed never-before-heard-of businesses into multi-million dollar brands. Maybe you can’t reach Oprah, but there are thousands of influencers out there from social media influencers to published industry leaders. Identify who these influencers are in your industry. They may not have millions of followers, but even someone that can influence several dozen people to try out your app may be valuable to your mission. Contact them and introduce them to your software. Offer them a free trial or invite them to your beta, and ask them for their feedback. If they like it, they may mention your app on their blog, podcast, youtube video, or even just share it with their social media following – providing you with valuable exposure.
  • Pitch Your Brand Story To Journalists – Brands need their stories exposed, and journalists are always looking for great stories to write about. This creates a mutually beneficial relationship between entrepreneurs and the media. However, a great story has to really be extraordinary – nobody really cares about a new app that no one has ever heard of. Instead, find the parts of your story that really matters. Do you have a fantastic founder story or some never-before-seen industry data that would be interesting to those in your industry? Find the angles that give the most light to your business and pitch it to journalists that write for the publications that your audience read. The amount of exposure you can get a week before your app launch will directly relate to the number of downloads you can expect on the day you launch.
  • Showcase Your Expertise With Guest Posts – Many blogs also often look for new and interesting content that they can expose to their audiences. Identify which blogs are most popular among your market, and offer to provide an expert article to that blog. By guest posting articles on popular blog sites, you can directly reach large established networks that may have been impossible to reach previously.

Setup Analytics and Tracking Software

The day of your app launch, you’ll need to start measuring KPIs and tracking app metrics to analyze how your software is performing. Without the right software in place, you will be unable to collect the metrics needed to optimize your strategy and progress the success of your application. There are many metrics that can be tracked, and here are some awesome analytical tools that you can use to measure your app’s performance:

  1. Flurry is an analytics tool that allows you to measure how many users you have, what actions they are taking when using your app, and what pages they are dropping off at. Furthermore, Flurry provides a report any time there is an error or crash; and allows you to track revenue, sales, events and other important metrics.
  2. Apple App Analytics is Apple’s developer analytics tool. This tool offers in-depth reports on the performance of your app store listing, gives you an overview of your user engagement metrics and provides detailed reports on crashes and bugs.
  3. App Annie allows you to easily access an in-depth analysis about your app’s performance over any period. You can measure unique metrics like the performance of your keywords, your position on store charts, cross-app usage and much more.

In addition to your app tracking software, it’s also a good idea to make sure you are subscribed to and setup with all relevant marketing software as well. If you’re using apps like Mailchimp, Squarespace, Buffer, Unbounce, ActiveCampaign or another marketing software, ensure that your subscriptions are up to date and that your marketing materials (like email marketing scripts) are already put together and ready to send.

Decide On A Monetization Strategy

Apps can be expensive to grow over the long run. While some app startups turn to investors for funding, many successful app startups are able to sustain their initial growth through earned revenue. How much you charge for your product or service – and how you charge – depends on what your app is, how it works, and how much your audience is willing to pay. For example:

  • Minecraft and Afterlight are successful apps that charge up-front for full access to the application.
  • Headspace and Evernote rely on a subscription model, requiring users to pay a monthly fee to access and operate the software.
  • Fortnite and Pokemon Go rely on in-app purchases to earn revenue and monetize their users.
  • Social media sites like Facebook don’t charge anything to users, but instead, charge advertisers to promote ads directly to their users.

According to statistics however, the most successful model for most apps is the freemium model. With this monetization approach, users are able to access a basic version of the application for free; but if they want to access additional features, they must upgrade to a premium monthly subscription. This model allows developers and app entrepreneurs to capture a broad audience and transform a handful of these free users into paid customers.

For more information about monetizing your mobile app, check out the article, “How To Identify The Most Profitable App Business Model”.

Phase IV: The Day Of Your App Launch

The Day Of Your App Launch

One of the most important days as an app entrepreneur is the day of your app launch. If you’ve taken the proper steps so far, you will start receiving downloads immediately. The day of your app launch, there are two major steps you should take – announcing your launch and measuring your app metrics.

Announce The Launch of Your App

Remember a month ago when you started interacting in different social communities and built a widespread email list of interested consumers? Today is the day you can finally take advantage of the relationships you have built. Announce the launch of your app on your social media pages and send an email out to your list. Remind them of the benefits of your application and provide them with a link where they can access your software immediately.

Furthermore, send out a press release and a link to your app to reporters and influencers that you have built relationships with. Invite them to download the application and encourage them to share it with their audience. Influencers have power, and this power can give you a major advantage. Offer influencers an incentive to check out your app; maybe consider giving them free access to a premium package or some initial credits for in-app purchases.

There is much benefit in driving traffic on day one. Apps with promising traction can end up in the “New and Noteworthy” or “Trending Apps” categories; making it quickly visible to millions of users.

Start Analyzing Your App Metrics

Since you have already decided which metrics you need to track and have setup the right software to do so; now you need to start actually analyzing these metrics. At minimum, on day one you should begin measuring your number of downloads, active users and engagement metrics like Daily Active Users, Monthly Active Users and Number of Sessions Per Day.

Furthermore, stay in tune with customer feedback and seek to quickly identify any bugs, crashes or weaknesses on your app. Users can be unforgiving towards an inconsistent app that is heavy with bugs. Software isn’t always perfect, but quickly identifying and fixing any bugs will be critical to establishing an exceptional user experience.

Phase V: App Success For The Long-Term

App Success For The Long-Term

Assuming you’ve accomplished each of the previous steps, you will now have a strong foundation for a successful mobile app. The final step is to grow your user base and scale frequently; converting users into paying customers and earning a substantial profit. But how do you get there? Here’s a couple tips:

  1. Analytics Tell The Real Story – Your app metrics will always give you the real story on how well your app is performing. Just having downloads isn’t enough – over time, it’s also important that you know how well you are converting these users into customers, how much each customer is worth, what your Net Promoter Score is, cost per acquisition and more. The more that you understand your app metrics, the better you will understand your users; and the more you understand your users, the better you will be able to deliver them the most effective solution.
  2. Keep Your Users Happy– Always pay attention to what users are saying about your app in your reviews, on social media, and online. Sometimes you will have an unhappy customer (or ‘detractor’) that may say negative things about your solution. Every app has a few dissatisfied customers, but if you see a pattern of many users complaining about the same thing then it may be a sign that you need to quickly make changes to better serve them.
  3. Never Stop Promoting – Always continue to improve and optimize your marketing campaigns. Continue building strong relationships with influencers and media; continue to interact with consumers on social media; and continue to optimize each technique for better performance. As you scale, your marketing strategy will become even more important.

The day of your app launch will either be a major success or a major failure, but if you follow these tips effectively, you can almost ensure that you will receive at least some positive traction on your first day of app launch.

The first step to launching an app is actually building one, and we’d love to help! Our team of startup experts and app developers know exactly what it takes to bring your idea to life. Contact us to setup a free consultation today!