The first thing that holds back your idea is funding your software development. The second is marketing your product.
Software drives everything nowadays; from the big innovations that are shaping our world through to the silent, but dependable, systems that keep us all ticking over. But where do these ideas start? Who takes a ‘what if’ and turns it into a viable solution? How is all this innovation paid for? And what about all of the game-changing ideas that are still hanging around the drawing board waiting for someone to ‘add cash’?
The fact is that for every great idea that makes it into the mainstream, there are hundreds (maybe thousands) of also-rans. We suspect that among those ditched solutions or written-off inspirations were some potential gems that just didn’t find the right interest, attract a visionary backer or generate enough funding.
What is the secret to getting funding?
It is a real shame that great ideas are lost on a financial technicality, especially when there seems to be a lot of half-baked and sub-standard software being released. And if we can help even one innovator to find the funding they need, then we’ve achieved our goal as software developers – making software deliver. There is no magic solution but here are a few things to consider:
Tackle the culture
In the UK, we tend to culturally be a little more risk-averse when it comes to investing in new tech. We see failure as ‘failure’ rather than a stepping stone to success. So, there is a cautious approach to venture capitalists in the UK supporting software development projects. In the US, however, particularly around Silicon Valley, lots of people are willing to take a punt on finding the next big thing. Culturally they are much more inclined to try things out for a while on the chance that they might discover solutions.
Consider joint venture v’s investment
‘Joint’ means that your new partner owns a piece of the software you are developing. ‘Venture’ means that they should be on the journey with you. So, make sure, if you JV anything, that the other party also shares the risk and shares in the overall contribution. If not, your deal is not better than commercial finance.
The most important advice of all – HAVE A (fully costed) BUSINESS PLAN
- Outline the full background, market requirement and opportunity for your idea
- Show any progress you have made along with some form of visualisation
- Detail the entire development costs and timescale estimates
- Share any market research, proof of demand or planning information available
- Demonstrate that you understand the operating and marketing costs comprehensively
In truth, most of these tips (1-5 above) are common sense – but the 5th one is critical. Most software development projects are focused purely on the cost to develop, and the application: but the hidden cost is how much it will need to take that product to market. This is the one that catches most people out – and showing an investor that you understand this will significantly increase your chances of funding.
Talk to us
We’ve been here before! Get in touch for a bit of software development advice – we can help navigate this stage.