Crowdfunding an App for Beginners (With Examples and Websites)

Editor’s note: This article is written by a Guest Author

Crowdfunding is becoming a go-to option for many business enthusiasts. Everyone looking to build something of their own is eyeing top crowdfunding sites for investments, especially those looking to fund mobile apps.

If you look at the industry itself, the crowdfunding market is expected to reach US$1.20 billion in 2024, with campaigns raising an average of US$8.15k. If you’re considering crowdfunding for your app, we can help you know everything you need to get started.

Contents

• What is crowdfunding?
• Why crowdfund your app startup?
• What are the types of crowdfunding for apps?
• How to launch a successful crowdfunding campaign for your app?
• What are the best crowdfunding sites to fund a mobile app?

What is crowdfunding?

Crowdfunding is when you raise small amounts of money from a large group of people, usually through online platforms. Instead of depending on big investors or business loans, you can get funding from small businesses and everyday people who believe and show faith in your mobile app idea.

Why crowdfund your app startup?

Crowdfunding offers several benefits, like helping you become more confident about your app idea by getting the right support, attracting attention from the target audience, and building a loyal community. Let’s look into why it’s a smart choice for your app:

1. Validation of your app idea

Crowdfunding allows you to test the market before spending a lot of money on your app. When people back your project, it means they find your idea relatable. If you reach 30% of your funding goal in the first week, it’s a strong signal that your app has a bright future.

2. Buzz building to attract attention early

Crowdfunding creates excitement around your app. 78% of successful campaigns raise more money than they expected to, it’s all because of the buzz they generate. This attention brings in media coverage, social media mentions, and sometimes, if you are lucky, even partnerships, all or nothing of which can help your app get noticed.

3. Community growth to foster user Engagement

Crowdfunding helps you build a community of supporters who can become your app’s future users. Fundera report shows that successful campaigns have an average of 47 supporters, each helping spread the word about your app. This kind of community engagement is crucial for long-term success.

4. Credibility boost among investors and users

Meeting your crowdfunding goal not only boosts your app’s credibility but also attracts investors and users. With only about 22.4% of crowdfunding campaigns succeeding, hitting your target can make your app stand out and open doors to future funding sources.

What are the types of crowdfunding for apps?

There are several types of crowdfunding, and choosing the right one for your app can make all the difference. Here’s a look at the most common types:

1. Reward-based Crowdfunding

With reward-based crowdfunding, backers donate money in exchange for rewards, like access to your app or special features. It’s a great way to get people excited about your project and build a loyal following.

For example, Flow Hive raised $14.9 million on Indiegogo by offering honey-harvesting kits to investors.

2. Equity Crowdfunding

Equity crowdfunding lets supporters invest in your app in exchange for a share of ownership. This means they become part-owners of your app, benefiting from your idea as it grows.

For example, Good Empire raised over $1 million through Birchal, gaining thousands of investors more backers. It’s a good choice if you want to raise significant capital while building a committed group of investors/supporters.

3. Donation-based Crowdfunding

Donation-based crowdfunding is all about raising money through charitable contributions, without offering anything in return. This model works well for apps with a social cause.

Pebble Time, for instance, raised over $20 million in donations thanks to its loyal fanbase and innovative product.

4. Debt Crowdfunding

Debt crowdfunding lets you borrow money from people who expect repayment with interest. It’s a good option if you want to keep full control of your crowdfunding app development but still need funds to get started. If you’re confident in your app’s financial future, this can be a great way to avoid giving up equity.

How to launch a successful crowdfunding campaign for your app

Starting a crowdfunding campaign and raising funds for your app takes more than just setting up a page. Here’s a step-by-step guide to help you get the most out of your campaign:

1. Frontload your campaign to create momentum

Kick off your campaign with a bang. By getting early investment, you’ll create momentum to help you reach your goal faster.

2. Focus on a clear and compelling story

Your story is everything. Make sure to tell potential backers why your app matters and how it will solve their problems.

3. Use engaging visuals and videos

As they say, a picture is worth a thousand words, and a video is even more powerful. Show off your app with visuals and videos, so that you can clearly explain what it does and why people should care. Your pitch is your only chance to make a strong impression.

Use a professional funding presentation template to clearly explain your app’s vision, market, and funding needs.

Image: SlidesAI

4. Be detailed and specific to win trust

Be transparent with your investors. The more details you share about your app development and how the funds raised will be used, the more trust you’ll build with potential investors.

5. Reward your backers generously

Offer great rewards that make supporters feel appreciated. You want them to feel like they’re getting something valuable in return for their investment.

6. Offer multiple price points to attract diverse investors

Make sure you offer rewards at different price levels. This allows you to reach a wider range of investors, from those who can contribute small amounts to those willing to invest more.

7. Employ an effective promotion strategy

Promote your campaign on social media, email, and through influencer marketing. The more people who know about your campaign, the more likely it is to succeed. If your app connects with Shopify, leveraging Shopify E-commerce SEO can help improve visibility and drive more traffic to your own campaign page.

8. Maintain transparency and communication

Keep your investors updated throughout the campaign. If you communicate with them regularly, they will be able to build trust and stay engaged.

9. Plan a solid post-campaign strategy for long-term success

Once the campaign is over, you have to follow through with rewards, keep your investors updated about your app’s progress, and continue building your community for long-term success.

What are the best crowdfunding sites to fund a mobile app

Choosing the right crowdfunding platform can make or break your campaign. Here’s a look at some of the best crowdfunding sites for app developers:

1. Indiegogo

Image: Indiegogo

Indiegogo is one of the most well-known crowdfunding platforms. It offers flexible funding options, allowing you to set a funding goal date that suits your needs. With its large audience, it’s a great platform for app developers looking for visibility.

2. Kickstarter

Image: Kickstarter

Kickstarter is another popular funding platform that’s great for app creators who want to build a community around their projects. It’s best for reward-based crowdfunding, and it has a track record of helping successful projects take off from the ground level.

3. AppsFunder

Image credit:AppsFunder

AppsFunder is a crowdfunding site specifically for mobile apps. It’s designed to help developers raise capital through equity or reward-based crowdfunding, making it a solid choice for app startups.

4. GoFundMe

Image credit: GoFundMe

The crowdfunding site GoFundMe is widely used by individuals and organizations to raise funds for various causes. It’s also a useful tool for app developers to collect donations from numerous sources.

Final thoughts

Crowdfunding is an excellent way to fund your app, especially if you want to build a community, get some external approval for your app idea, and raise money seriously without having to depend on traditional investors. With the right strategy, you can turn your app idea into a reality.

Take the time to choose the right crowdfunding model and platform for your needs, and remember to stay transparent and engaged with investors who are backing you.

About the Contributing Author

Anurag Bhagsain is the Founder of slidesai.io, where he leads the charge in transforming presentation design. With a love for blogging, Anurag uses his expertise to create informative content that educates and motivates.