I am creating the app with Zapporoo and the first two phases haven't Been that much money but I know once we hit programming phase the cost will sky rocket. Just trying to start networking with investors before I get to that point.
Hi there! Best of luck as you complete your college degree. From experience I will try to give you some insight into the world of startups and mobile apps.
First some things to consider:
1. You live in a world of social klout
2.Apps must (specially iOS) must be very well developed, otherwise the users themselves will filter you out.
3. Apps must be relevant if you want to succeed. You've have probably seen this, a lot of paid apps go for free for a while when their sales begin to stall or never actually make any pay back to the developers. Free is an easy way to get users and thus paid advertisements or in app purchases (if they are good enough to keep)
Assuming you will have all 3... Let's move on to your question:
Most investors won't entertain an idea alone, specially if you haven't any prior successful experience in running a startup or app development company. Some do however, consider depending on your social klout, learn about growth hacking and consider growing your social relevance before the completion of the app. As mention by Ryan Holiday, a blogger not too long ago got investment for a book from a simple screenshot of his followers' requests for the same topic... he decided to write a book and through his community market it. This was a no brainer for the publisher investor.
With that said, an often unspoken rule of networking is that you don't ask for favors in your first intro. You don't do that in your personal life, you shouldn't do that in your professional. Make friends in the right place, build relationships with a backbone in honesty, mentorship and through time as they see you work and guide you they themselves begin to entertain the idea... In the future, when you ask, your chances are much better that way.
Get yourself a team, find a developer to mentor you and help you improve as you learn. Most new entrepreneurs think that their product at launch is their "final-good enough for a while- product" and is not! Complete opposite, you must realize that your initial launch is nothing more than the 1st iteration of the many to come if you want your community of users to stick with you and share their experiences with others as you help them and improve their lives by listening to their suggestions and issues with your app. If you have a developer this will become easier in the long run as well as tell an investor that you are capable of being a leader, even if is of 1.
Best of luck, give me a call if you wish to talk a bit more :)
As a developer, especially one with experience in the startup world, I get approached all the time by people with ideas they would like to take over the world with :)
The single most important piece of advice I give all of them, and that I would like to offer you is to find a technical co-founder or mentor.
You can get all the advice you want, and there are some incredibly smart and experienced people out there who can help and guide you, but what you really need is someone invested in your success - Either in the business, or invested in you.
In my experience as a Consulting CTO, and one involved with multiple investment rounds, what you need to attract investors is:
1) A technical co-founder or mentor who can help guide you in how best to spend your investment, and who will spearhead the development of an MVP
2) A clear-cut go-to-market strategy that shows your product-market fit, and how you will get your idea to potential customers.
To be absolutely clear, just submitting an app to the app store and hoping it will be a hit is not a GTM strategy - You need to build a community of interested parties who will come into the app store from outside and drive downloads.
I'd be happy to have a quick call with you if you have any specific questions.
I've been involved in advising a large number of startups over the past 10 years. I've seen a some of them receive investment from a variety of sources and many that did not end up landing investment. I've also invested in a number of startups myself as an Angel Investor.
I think we can break down "investors" into three basic categories. (1) Friends & Family; (2) Angel Investors; (3) VC / Institutional Investors. Depending on what stage you or your startup are in, I think you can look at them all in the following way:
Friends & Family
If your product does not have much business traction (a fast growing user base and/or a growing amount of revenue) and you yourself do not have a track record of building and exiting from successful startups, then Friends and Family may be a good option for you to consider. Friends and Family will invest in your startup because they believe in and like you. They will not be nearly as concerned about actual business traction as Angels and VC will be. They love you, they want you to succeed, and they are more likely to believe in you in spite of a lack of history.
Angel Investors are looking for some form of validation either on the business idea, product, or you as a founder. A sophisticated and professional Angel Investor may have a number of criteria that they are looking to see met ranging from potential market size, growing / shrinking market, strength of competitive advantage, track record of founders, evidence of product/market fit, revenue, the passion of the founder, etc. You need to think about creating a strong case to convince Angel Investors to invest in the startup. The evidence should be more than your personal passion for the idea. I think many Angels will take more risk than VCs and Institutional investors, but you should definitely have a primetime real investment opportunity here.
VCs / Institutional Investors
These type of investors are looking for a proven and validated business model that is ready to be scaled. Some are looking for $10M businesses that can be scaled to $100M businesses. Others may be looking at more early stage ventures that have a very strong competitive advantage in the marketplace and the potential to grow very large very quickly. In some cases, I think we've seen some VCs invest in founders in the idea stage, but this is generally an exception rather than a rule.
Well, Humberto gave a very good and detailed answer and I will be happy to add just a little bit more.
First of all - I must disclose that I work for a company that develop apps and other software for every one, from people like you that are just starting to big well established companies.
When someone comes to us with an idea, we usually sit with him and write down its specifications. We write in details what the app should do (and look like) from the users' side (with some mock screens) and from the server's side. Once we have that, we can estimate the scope of work and give a price offer.
This cost money, so be prepared for some initial investment from either your own pocket or from what is known as the 3F (Friends, Family & Fools...).
After you have the specifications you can start asking for price offers so you will know how much money you need to raise. A good way to get investors would be to develop a demo or proof of concept. Something that will look like an app but will not do much. Developing a demo is much cheaper and in most cases will help you better convey the idea to potential investors.
Good luck and give me a call if you have more questions or want more ideas.