How to Get Your App Funded in 2020 (App Funding Guide)
July 27, 2020

How to Get Your App Funded in 2020 (App Funding Guide)

how to get app funding

App funding is challenging but if done in the right manner, it benefits both the parties, the app owner and the investors.

Have you ever heard a conversation that does not have an application usage terminology in it? Probably no. Living in the world of digitization it is merely impossible to talk without addressing online payments, shopping, e-bills, and stuff. According to Sensor Tower, the global app revenue reached $50 billion in the first half of 2020 with an increase in CAGR by 23%. This surely states that the users are inclining more and more towards the app world.

Now, obviously, with the increasing users, there is an increase in online business ideas. Being a newbie, you might think about how will you succeed in the business? Where will you get enough app funding to keep up with your business and expansion? How to draft a business plan like Uber, Spotify, Tinder? Sit back and relax. We are here to answer the burning question of money and where will it flow for your startup app idea.


Are you having a great app idea?

The one which can probably give a revolutionary change in people’s lifestyles like GrubHub, Bumble, and more?

Are you afraid of the market and the pitching methodology for fundings? Don’t worry as we have got you covered. Being in the mobile apps development business over a decade we have come across many apps who were barely able to stand the competition because of their poor ideation and no further business plan for fundings.

Thus, it is very much necessary for you to think beyond ideas and feature curation. Investors around the world are no longer ready to invest in a project where they have to wait or you can also say it as where they do not see profits coming in at regular intervals. So before jumping into the whole app funding idea, let’s just get into your head and get the basics right.

The very first thing before coming to a conclusion on funding apps is to ask yourself some questions. Herein we have narrowed down some of them for you.

4 Questions You Need to Ask Before Approaching Someone for Fundings

1. Who will invest in my mobile app idea?

You are in a competitive market space where every day there are thousands of applications deployed on the app stores. So, without getting under confident or overconfident about your idea, study the investments of goliaths like Uber.

There are two kinds of possibilities when it comes to ideas and potential investors.

  • Your idea has the power to draw the investors towards the product

Uber had a unique app concept that an individual can book a ride through his smartphone and avoid hailing a ride with the wave of his hand. This attracted Silicon Valley to invest in Uber by summer 2015, with total funding of $10 billion. Other app investors that contributed to the funding were Fidelity Investments, Jeff Bezos of Amazon, Goldman Sachs, Blackrock, Lone Pine Capital, hedge funds as well as private billionaires.

  • You go and sell your idea to the investors with utmost faith in your thinking

Spotify app, the revolution in the music streaming industry is a freemium model that earns money through advertisements and fundings. But it is still not able to lure venture capitalists like Google Ventures because of its biggest competition Apple music. It is still struggling with its idea and investors’ approach but is stable with the revenue in the form of advertising royalty.

So, you must understand that your app has to have a backup in the form of such freemium models that can churn some revenue and keep yourself moving till you get big investments for your app development.

Both of these tactics will bring you, investors, sooner or later with apt funding for your app. But, the crust of this is your “app idea.” Prepare a modular structure with all the possibilities of profit-making with or without the investment from the fundraiser, so that you have all the roads that will take you towards the online success of your business.

2. Why should one be interested to fund my online business app?

In this era, everything is about finance and financial stability. There is no barter system running in the economy that balances out the business equations. It is a vicious cycle, wherein you need money to get customers but you need customers to get money.

When you decide upon a mobile app idea, you need to figure out the sectors or people who might get influenced by the business idea. Let’s go step by step with your app idea that will help in knowing the interested angel investors.

  • Know your app’s niche:

No investor will invest in an existing idea. Make sure you study your competitors and marketplace. Be sure about your offerings, in-app features, UI/UX design. It should be one of a kind to lure the investors. Ask a question to yourself like which problem is solved by my app? What is the unique selling point (USP) of my app? How is my app different from the others in this service genre? These are the generalized questions asked by many investors and will help you analyze your own thinking for a while. Work on your specifics because investors are not looking for haywire answers. You should know your targeted audience, what features your app includes, and other small details of your application. Narrow down your app idea and earn the investor’s assurance in the funded apps rounds.

  • Branding the app:

Branding makes your app realistic. No one will rely only on words, you need to create your logo, online domain, and start some online activities. Investors are not your friends and family who will hear you blabber your idea and appreciate it. They want proof and an up-and-running plan of action of your app startup. If you want to pitch venture capitalists this a great way. Make a mockup of the website or application- so that it becomes easy for the investors to visualize your idea and understand the minute features and functionalities.

  • Work on your elevator pitch:

A startup funding is critical, you need to prepare a quick brief about your application idea. Investors do not have a whole day to listen to your plan. Prepare a short speech of less than a minute summing up your whole idea. It should consist of the crux, punch line, problem elimination, key feature integration, and a vague plan of future goals.

For instance, imagine an interviewer asking the question to describe yourself in three words, you will respond to this as accurately as possible. Same goes with your app, prepare a gist about it as an “elevator pitch” and get your investors hooked up to it. If you are not able to precisely state your app ideas then you need to go back and do proper research on it. Elevator pitch is a small speech that helps you to reach the angel investors list. If you are on that list, they are interested in knowing about you and your app. Thus this pitch works as the first impression is the last impression for your application.

  • Prepare a pitch deck:

After your elevator pitch gets selected and is on the list, you need to start prepping up for a pitch deck. This is similar to a PowerPoint presentation or a slideshow representing some more key factors about your great idea and market research did precisely to fund your app. You are not supposed to put the exact script that you will probably use for further meetings with investors. This is an ideal chance for you to show some graphs, statistics, branding, and make your online business more viable for investors. They can also have an in-person discussion with you after looking at your presentation which will make it more interactive for both the parties.

  • Create an MVP:

If you do not want your apps for funding to fail miserably, it is very much necessary for you to make a minimum viable product (MVP) before launching it full-fledged in the market as well as approaching any angel investors. It will visually help them understand the working flow of the app and also help you to find glitches in the early stage of application in the online world. To get funding and further partnerships with the venture capital firms, MVP always helps in bringing out the best of your app has ever had. No matter which way you take the investors will set the funding amount looking at the efforts you have put, in making the app.

We at Space-O have also made it easy for you to understand the mere concept of MVP by just gathering the specifics for you in our blog- What is the Minimum Viable Product? How to Plan, Build, and Improve MVP for Your Business? This will surely help you in knowing and setting your funding goals much better than the other app entrepreneur or app companies.


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3. How much money will I actually need to make my app successful?

This is a burning question before starting any of the above tactics. How much will you quote for your app? For a funding process to go smooth you need to have an approximate idea of the amount you want to meet for the future expansion of your application. It might happen that the assumptions are much far away than the actual amount.

If you fund your app with more money than you are likely to give away your firm to the investor. And if you quote less amount you will not be able to achieve your goals. You have to work hard and figure out the estimated cost of developing an app with specific functionalities and user-friendly navigation. Your end goal is to justify the approximate amount in front of the investor.

You can also ask yourself certain questions like how much money will I require to create an app? how much money will I need to lure the audience? how much money will I need to maintain the app once it is deployed on the app stores? These will push you towards a mobile app development agency and know the exact costing. As we know, the maximum amount will go into making an app and the rest will be settled down among the other two questions.

Even if you are funding your own app through friends and family then also you need to have the mere idea of the money. In this way, you will eventually be able to keep track of the money and organize future planning beforehand.

Finally after studying the cost, and figuring out your pitch deck, its time for you to think about the available options for funding your application idea.

4. What are the available options for my funding?

#1 Seed funding

Seed funding or angel investors are very hard to please as they enter at the idea stage of the app. They do not require much control which allows the company to function at its own will. These investors just need proper strategies related to ROI, and one of a kind idea that can revolutionize the existing online world. As they do not see any materialistic representation of your business, the only way to lure them is by a successful idea that can work realistically in the coming future. Make sure that you have done enough research to answer each and every question asked by them.

#2 Bootstrapping

This is the most convenient and easy way of funding other than seed funding or angel investors because you are your own boss. There is no one to rely on or share your profits-loss with. Bootstrap is also easily done with the help of friends family. Initially, if you are capable enough to fund your own app startups than with such a start you might not even need outside investors in the future when you will earn money from the online business. But you can always go for investment loans as a backup plan for your app.

#3 Crowdfunding

With collaborative efforts, one can raise funds for its app. There are three types of crowdfunding like donation, reward-based, and investment funding. These are done online or through social media. It can also work as a barter system where you can give a reward or share of the business. This technique is easy compared to the other fundings.

In donation, the donor does not expect any reward or benefits in return. While in reward-based tactics, one is bound to provide some perks like a free product, names in the credits, access to the app, and more. The investment funding is the one where the investor will invest for the sake of gaining good ROI.

#4 Bank Loans

This is the most common and known investment technique. The banks lend you the loan and keep your assets on a guarantee. These days startups are well supported by the government. There are many financial institutions offering funds to the app startups, and thus, you have a high chance of gaining investments here. If you are financially stable then the loans are a good option for you.

Now, when you consider fundings for the app, you also need to understand the structured rounds that are heard by professionals. These will majorly help you in funding for your mobile app development.

How to Find Investors For My Mobile App?

Many of you, newbies, will be confused about the investor and the rounds, so herein we have simplified it for you.

  • Seed round

This round is at a very early stage where your idea is not materialized yet. You have to constantly sell your idea and ask for fundings. Such fundings are usually used in making MVP, laying a team foundation, and increase the traction to see whether they need or support the idea or not. This money will help you enter the market at a very small scale but you will get an idea of being rejected or accepted by the online user’s world. Here are some steps which will help you in gaining seed fundings.

  1. Justify your idea without any finances
  2. Approach your potential buyers before meeting the seed investor
  3. Bootstrap during that time period
  4. Introduce yourself to the investor with proper data and proof points
  5. Pitch with an articulated and organized deck that answers all their question in a one-on-one interview
  • Angel round

It is similar to seed round but is more formal. In this round outside investors can buy common stock in the company. The only common thing between both rounds is pitching the idea. Here the investor will be straightforward in tallying their investments with the ROI of your app business. Thus, you will have to win him over the argument as to why your idea is worthy of his investment. In the seed round the investor will not take much charge of the profits and losses but with Angel round, you’ll need to prove every single functionality and the benefit of it to him.

  • Series A

If you have reached this far, it means that you have got your clarity of concept and have already been in the market for a while seeing success of the product. You are now at a stage where focusing on product growth matters to you a lot. The series A funds help in achieving the scalability of the product and organizing the business optimistically. This round can approximately bring you $2 million to $15 million, and if you get through some typical venture capitalist then you might as well be able to bag home a huge amount of venture capital funding.

  • Series B, C, D, etc

After series A it is all about expanding your business in a new direction or grows globally, for which you will need bigger investments. Series B round can actually get you an overall investment of $25million from a potential investor. Followed by Series B other rounds like Series C, D, E, etc. investors usually go for public appearances with your firm or look for acquisitions in other companies or even expanding their business in new market services.

If you have got this straight into your heads, you will be able to crack the mobile apps development funding of 2020. Before ending the blog, let’s have a quick look at how to attend the investor meeting so that you avoid any woof-ups and it will also help you in the last minute preparations.


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How to Prepare For an Investor Meeting?

  1. Research your investor: The common mistake done by the startups is approaching any potential investor they come across. This can actually waste your time in the earlier stages, you need to find a specific angel investor or venture capitalist who specializes in your kind of business. Do not bump into any random stranger who is least interested in your ideas. Do proper research on them through public platforms like social media, articles, and more. Know their current portfolio and develop an understanding of their investments, success, failure. You can also reach out to the companies they have invested in the past and know about their working patterns.
  2. Write your elevator pitch and business plan: A gist about your business has to be summarized well. They will look forward to your executive speech which should consist of an understanding of the market size, demographics, your future goals. You must also mention the value edition of your application in your target audience’s lives (if any) and how it is different from your competitors. Now coming to the business plan, make the investor understand several milestones that you are likely to achieve with his money. You should portray a realistic return on investment in the meeting with investors where he can rely on your facts and figures. Do not bluff because it won’t help you in generating future investments.
  3. Practice your presentation: To avoid any mishap it is necessary for you to practice your presentation as well as the speech following it. A confident presentation makes a lot of difference. Do not exceed it more than 30 minutes, make sure you are not speaking the exact same words written on the slide but actually explaining them through your verbal representation. Let their questions welcomed in between the presentation and do not rattle yourself away from them.
  4. Estimate and explain how much money will you need: A man who is investing in your business plan, has all rights to know about the bifurcation of money, it might also happen that he can help you save some with his experience. Avoid asking for less money, directly break-down the actual cost, and make them understand its vital importance. It should be fair, and a reasonable split that should favor both the parties equally.
  5. Take a Q&A round with the audience: When you are done with your presentation or speech, open yourself for some questions from their side. So, you can resolve any confusion or query right at the moment. It may also happen that you go into self-analyzing your own thoughts and presentation. But it will be a brain-storming session for both parties. It will also allow investors to pass suggestions or advice which you should take in a positive way and improve your product accordingly.


1. How do mobile apps get funding?

  • Crowdfunding
  • Donations
  • Funding contests
  • Bootstrapping
  • Strategic partners and Angel investor
  • Bank Loans

2. How to find investors for mobile app?

There are two successful tactics that will help you find a suitable investor. One is the websites like, Angel Investment Network, and more. Also, there are special meets for entrepreneurs and investors to discuss funding options. It is kind of setting a nationwide funding stage, that you can also attend with your startup app ideas.

3. What are the funding rounds?

Once you have decided on the idea of your application, you have to get ready to meet your funding sources, the investors. There are several rounds that have different importance for startups depending on the ideas. With each of the rounds, one will come across vivid investors with different requirements and skill set that he might be looking in you and your product. Here are the rounds that let your idea go through multiple considerations and milestones for improvement

  • Seed round
  • Angel round
  • Series A
  • Series B,C,D, etc.

4. How many users do you need to get funding?

If you are aiming for $1m-$10m than you must have a minimum of 1,00,000 users. This will help you in finding appropriate investors and they will be equally interested to know about your online brand. Thus, you have to justify your fundings with the engagement in your application.

5. How do you start an app with no money?

  • Outsource your app development project
  • Raise your capital
  • Pitch your app developer with an equity split
  • Make your proof-of-concept


There is always room for improvement.

This saying goes apt with the apps. Once you fund your app, your work does not end there. You will have to strive for better and launch new features, functionalities to maintain the engagement and grow for better investment options. You will be able to attend more rounds and achieve the milestones to make it to the next round and bigger investors.

Of course, for this, the pre-requirement that you’ll need is an experienced app development company like us. Space-O Technologies will help you right from your idea generation to app deployment stage offering app maintenance for a certain period of time which is a way to get investments in real-time.

We offer full-fledged services from native app development to web developments. From Uber clone apps to laundry app solutions we have been striving to make app revolution in almost every service genre possible. If you have any query or confusion regarding funding app, venture capital, crowdfunding platforms, funding campaign, app development cost, you can discuss it with us. Let us know your requirement through our contact us form and one of our sales representatives will consult you soon. The consultation is absolutely free.


This page was last edited on July 27th, 2020, at 8:13 AM.

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