How to launch your own start-up – a guide for the investor

Do you have an idea for an app to generate revenue? Do you want to release software that solves the problems reported by Internet users? Or do you care about building a certain community that is difficult to find in the current social media? Whether it’s an entertainment app, a work enhancement tool or a dating site, you can turn an idea into a commercial success. However, it is worth doing it with your head and proceeding in an orderly manner. We have prepared an article for you, after which you will be able to rationally decide to launch your start-up.

My application – tough questions to get started

In the beginning you should set the idea in the reality of the current world and (cyber)business. We assume that you have a general idea of how the development of a program or application goes. Answer questions that, like a sieve, will sift through your idea and, so to speak, help form the final shape of the concept:

• For what purpose am I creating this application?
• Who will use my applications?
• In which stores will my app be available for purchase?
• Is my application innovative or groundbreaking?
• What will my app have that the competition doesn’t?
• What projects do I want to get ideas from?
• Am I targeting a local or foreign customer with my application?
• What do I want and what do I definitely not want in my application?
• What will I do if there is criticism or low app ratings?

Do not proceed to the next steps until you can give a clear answer without doubt. If there is any “I don’t know” or, worse, “we’ll see” or “somehow it will happen,” then you shouldn’t implement the project yet. You risk failure, with which you will not only “burn” the idea, but also lose the invested funds. Pay attention to whether the whole thing is consistent with each other – you can’t say that you are writing an application to improve management processes in the company, and its main audience will be a child aged 9-12.

What exactly do you want to make money on?

Now that you have an idea of your app or program, it’s time to understand the essence of monetization. It’s not about economic indicators, measuring profit or profitability of the venture – it’s still too early for that. At this stage, you need to consider which billing model you want to implement for your solution. As a rule of thumb, there are three most popular methods of monetizing apps:

• Paid service – a classic billing model, in which once the payment is settled, the customer gets access to the tool permanently. Clear and transparent terms and conditions are valued by many users. For example, video games can be purchased in this way.
• Subscription – access to the tool is guaranteed until a recurring fee is paid. Failure to pay is equivalent to lack of access to the application. VOD platforms, such as the following, operate on this principle. Netflix, Disney+ or Viaplay.
• Freemium model – the base version of the program is free, but it is so truncated that it requires the purchase of paid add-ons. Only then is its full potential apparent. This is how Office 365 from Microsoft, for example, works.

Be aware that not every model will work for your idea. If you want to offer a mobile game, it would be best to use a freemium model (better resources or customization for real cash) or a classic paid service. Subscription is meaningless at this point – the exception is access to a catalog of constantly updated games, which is the case, for example. Xbox Game Pass. In such a solution, the player pays a certain amount per month in exchange for the ability to play almost all the titles that are on the platform.

How will you fund the creation of your app?

Before you can start making money from the app you release, you need to create it, and that won’t be possible without funding. Even if you are a programmer and only want to use open-source tools, you still need to have some funds at least for marketing and promotional activities. We know that nowadays, with the current inflation and high prices, it is difficult to talk about any savings. It is worth considering crowdfunding, i.e. through various types of airdrops. Developers of English-language programs will have a big advantage here – in countries like the US, crowdfunding tools are extremely popular. Kickstarter, Indiegogo, GoFundMe or Patreon are just examples of such platforms, although we can also find sites such as Patronite or Zrzutka in Poland.

If we do not want to rely on others, we can take advantage of various grants or subsidies. Both government and EU programs are available to support entrepreneurship and innovation. Some people may also consider using a loan or cash credit, but here there is a point to consider. Namely, such financing involves repayment of borrowed funds, and most often no later than three months after the loan is granted. Add to this high interest rates, changes in interest rates and it becomes apparent that borrowing after family or using crowdfunding support will be much better. Lucky those who have a dozen or at least a few thousand zlotys in savings.

Establishing cooperation with a software house

We may be hitting your ego a bit now, but the truth is that a software developer working alone will never be as successful as a software house. You are probably familiar with the saying that every two heads is not one? It would be in this case to write “every dozen heads is not one”. Each successive developer is a brand new, fresh perspective on the project and sees opportunities or weaknesses where someone else doesn’t see them. It’s also an increase in work efficiency – what you would write yourself in a month, in a software house will be created, tested and ready for release in two or three weeks. Not even Robert Lewandowski can win a match alone against a full eleven-man football team.

However, you should not make the assumption that the first better software house will be a good choice. Be sure to check whether your idea coincides with the scope of implementation and specialization of the company in question. It will be difficult to expect a fantastic mobile app from the specialists in desktop web store development. In addition to vetting the software house, it is important to create a brief, which is a plan of work and a set of understandings between the commissioning entity and the one doing the commissioning. You will only settle for what is written in the brief and on the contract, so think carefully about what you want to write into your expectations and requirements. Keep in mind, however, that each additional condition can raise the stakes.

Launching and actively promoting applications

Probably many of us are familiar with the game Cyberpunk 2077 – one of the hottest premieres not only in Poland, but also in the world. The problem, however, turned out to be not the predictable plot or combat mechanics, but a multitude of minor or major bugs. They were created not as a result of incompetence on the part of the developers, but as a result of hasty launching. Learn from your mistakes and give yourself time – it is better to delay the release of the tool for a month, but test it length and breadth, removing bugs. This way you will gain favorable reviews, and if not, at least avoid a wave of negative reviews right at the start. Launching should be well thought out and closely coordinated with promotional activities to gain your potential audience’s attention.

Speaking of promotion, it is impossible to ignore the fact that advertising is a lever of commerce. Here, however, instead of advertising, you need to focus on creating a need for your app. At the same time, it is a good idea to emphasize the name of the program, so that it will be memorable and installable in the future, when the recipient’s period of hesitation has passed. Promotion can be done in a variety of ways and by a variety of methods, but the most effective ones involve the use of social media. Consider the potential in platforms such as Facebook, Instagram and TikTok. Then think about how you can “weave in” your app and reach an audience that matches your target audience.

User support and application updates

Your project has been released to distribution platforms, there is some interest and first payments? Don’t let the initial successes fool you, this is not yet the moment to drop everything and buy a house in the Bahamas. Now really the hardest part of the investment, which is the credibility test for you and your application. As long as everything works properly and as promised, everything will be fine. But what if the first crashes appear, the need to refresh the app, and users start making suggestions? Adopting a passive attitude will be a fatal move and you will lose your existing customers very quickly. There will also be negative reviews that will effectively deter potential buyers. Once the app is released, you need to ensure that support is responsive and quick to write back. However, that’s not all – it is necessary to periodically carry out updates and provide “patches” for any shortcomings. There is no perfect program, and since technology is constantly rushing forward, it is worth ensuring that your application keeps up with it. Otherwise, users will quickly sense that the program is a bit of a dud, and at worst you will be devoid of protection against hacking attacks. So you can’t say that your own app is a passive income that doesn’t require any attention or work. However, this does not change the fact that your own app can be a brilliant idea for a start-up that brings huge profits.