How to Demo a Custom MVP App to Investors
You’re looking for investors to get involved with your app, but how do you pitch your app to them? We’ve put together some top tips about how to demo a custom MVP app to investors.
If you want to get ahead when it comes to developing and launching a custom MVP app, it’s important to get the right investors on board.
An investor, whether an angel investor or venture capitalist firm, will not only supply your startup with valuable funds, but give you useful advice too.
Pretty much all of the successful mobile app startups have pitched for and received investment at some point in time, from Facebook and Twitter, to Just Eat and Uber!
Getting time with a potential investor can be daunting, but it’s essential to demo your Custom MVP App to an investor in the right way. Otherwise, you might not get the result you want.
We’ve already looked at how to develop and design a custom MVP app and how to market your app to potential customers. In this article, we’ll look at how to demo your Custom MVP App to investors to get the best results.
(And remember, if you need extra support developing and designing your custom MVP in order to impress your investors, we’re here to help.)
Table of Contents
- What do we mean by demoing your MVP app to an investor?
- Demoing an MVP app to investors: what you need to know;
- Put together an elevator pitch;
- Keep your app presentation short;
- Choose the right investor;
- Have a backup plan in place;
- Show off your team’s background;
- Know your financials;
- Make sure your app is working;
- Prepare beforehand and get into the shoes of the investor;
- Remember that your MVP doesn’t have to be an app;
- Send a thank you email;
- Some quickfire tips for demoing your MVP app to an investor;
- How to demo a custom MVP app to investors FAQ;
- What is an MVP and how can I use it to get investment?
- Where can I find investors to demo my custom MVP app to?
- What do I need to bear in mind when thinking about how to demo a custom MVP app to an investor?
- How likely am I to be successful when demoing my MVP app?
- Are there any options if I don’t want to work with an investor?
What do we mean by demoing your MVP app to an investor?
By demoing your MVP app to an investor, we mean showing your app to them in an attempt to get them to fund your business idea.
At this point, it’s likely that you’ve wowed them over by emailing them an impressive pitch deck, answering all their questions, and getting a meeting booked to talk about your startup.
A minimum viable product, or MVP, is a great way to show your investors how your app works and increase the chances of getting funding. Not only can they see something tangible, but they can see that you’ve already worked hard on your app and are more likely to see success.
After all, if you’ve already invested tens of thousands of dollars into your custom MVP, you’re showing how committed you are!
You can also gather statistics to show how people are using your app, how much they’re spending, and how long they continue to use your app for. Investors love to see quantitative data as it provides an objective opinion about how well your app is doing.
Find out more about some of the stats you can use:
- The average revenue per user;
- Churn rate;
- Customer acquisition cost;
- Customer lifetime value;
- Monthly recurring revenue.
Demoing an MVP app to investors: what you need to know
Chase the vision, not the money; the money will end up following you.Tony Hsieh
When you get a meeting with an investor, you typically get an hour. In this hour, you’ll need to go through your pitch deck, demo your custom MVP app, and answer any questions that investors have.
An hour may sound like a lot, but you need to make every minute count if you want to get another meeting in the diary!
The first step is to develop your MVP and identify the features you want to include. We’ve got lots of articles showing you the steps to do this. Once your MVP is ready, it’s time to start pitching!
Here are our top tips when it comes to demoing your app to a potential investor.
Put together an elevator pitch
Imagine that you’ve just got in an elevator with someone, and they ask you about your startup and MVP app. You have about 30 seconds until they get off. What do you tell them?
This is what an elevator pitch is – a brief introduction to your business. It needs to be short, but keep people engaged, either with a story or a compelling stat.
For example, let’s say you’re the CEO of a mobile app that helps people find happy hour restaurants near them. Your elevator pitch could go something like this:
I’m the CEO of the HappyFood app. We help hungry tourists across the world find the best restaurants selling delicious food at discounted prices. Businesses sign up for $25 a month to include their details, and as a result, they see a return on investment of up to 900%.CEO of a mobile app
You can use a strong elevator pitch as the linchpin of your presentation and to help you understand what to showcase to your investor. Take the time to develop your elevator pitch and refine it as your startup evolves. Don’t be afraid to tweak it slightly for each investor you pitch to.
Keep your app presentation short
Our first tip when asking ‘how to demo your custom MVP app to an investor?’ Keep your app presentation short and concise. The pitch deck accompanying your custom app demo should be less than ten slides if you’re going for seed funding and less than 20 slides if you’re going for series A funding or above.
Keep your pitch to the bare minimum. While you might want to talk about the amazing new office space you’ve just invested in, it’s likely that your prospective investor won’t be interested at this moment in time! By showing that you respect your investor’s time, they’ll respect you in return.
The same logic applies to demoing your MVP app. You might want to show your prospective investor every single feature your custom MVP app has – you’re proud of your work after all! However, it’s best just to give them an overview of what your app does and how it works.
Imagine the typical customer journey – how they log in, how they access specific features, and how they pay for products and services. Make sure everything is clear and as fuss-free as possible.
According to Meetingking.com, 91% of people pay attention for the first 15 minutes of a meeting. After half an hour, this drops to 84%, and 64% after an hour has passed. You don’t want your prospective investor to start nodding off!
This meeting is a precursor to another meeting – make it so the investor wants to find out more about what your app can do.
Use customer data to your advantage here – what features do your users use the most, and which features bring you the most income? These should be the features you prioritize in your meeting.
Choose the right investor
There are lots of different investors out there, and it’s important to choose the one that’s the right fit for both you and your startup.
47% of startup founders regret getting the funding deal they did. While it might be nice to agree to the first term sheet you get, it’s more important to work with an investor that understands your business. This can make the difference between success and failure for your startup.
When looking for investors to demo your custom MVP app to, consider the following:
- Those with experience in your specific niche. It’s better to work with someone with knowledge of your industry, although a more generalist investor can be good if you want to diverge in the future;
- Those that have worked with similar startups before. You want someone with a successful track record. Look at the startups they’ve worked with and their success. If all the startups they’ve worked with have failed, it’s a red flag;
- Those that ask the right questions and use the correct terminology. You want an investor that’s attentive and interested in what you do;
- Those that share your values and vision. Cultural fit is very important when it comes to funding. While your investor doesn’t have to be your best friend, they should have things in common with you and your team;
- Those that can offer the amount of money you’re looking for. There are different funding rounds to accommodate each stage of your startup;
- Those that are asking for the right amount of equity. More experienced and in-demand investors may ask for more from your business.
This will help you choose the investors that will have the most positive impact on your business and means you don’t waste your (and their) time.
Look for twenty to fifty prospective investors to contact. This might sound like a lot, but the reality is that you’ll only get four or five meetings and one or two term sheets. That way, you won’t be disappointed when the ‘thanks but no thanks’ emails come in.
Have a backup plan in place
You need to be prepared for all eventualities when your meeting takes place. For example, what happens if you can’t sync your mobile phone to the screen or the office Wi-Fi is down?
It pays to have a backup plan in case the worst-case scenario happens. For example, if you plan to run through your mobile app in real time, make a short video of you going through all the different features. If you can’t use your phone, you can play the video. Alternatively, make sure everyone on the team has the app installed on their phones in case yours isn’t working on the day.
Think about all the things that could happen and have a plan in place for all of them. It pays to be organized in the business world, and an investor meeting is no exception!
Not only will you be able to demo your custom mobile app seamlessly, but the investor is likely to be impressed by your ability to plan ahead and roll with the punches!
Show off your team’s background
While your custom MVP app and its features are important, your prospective investor will want to know about the people that make up your startup for two reasons.
Firstly, they’ll want to know that you can work well with them and that you share their values.
Secondly, they’ll want to be assured that your team can not only build the app, but sell and market it effectively.
When you go through your pitch deck, we recommend having a slide introducing the key members of your team. Think ‘hacker, hipster, and hustler’ – who is the lead tech whiz, creative, and leader? Provide photos and a little bit of information about their experience.
You can generally bring one support person to the investor meeting. If you’re not 100% up to speed on the technical development and features of your custom app, we advise bringing someone along who is!
Know your financials
Your prospective investor will want to know all about the people in your team, but they’ll also want to see how your app will make money!
All investors expect some return on investment on the funding they give you, and your presentation is the perfect opportunity to tell them what this will be.
Include a slide detailing how you plan to monetise your custom MVP, how much money your app has made so far, and what your forecast for the next few years will be.
It’s highly likely that your prospective investor will have lots of questions about your bottom line – think ahead to what these questions might be and prepare some responses. Remember that if you don’t know an answer off the top of your head, it’s better to come back to the investor after the meeting rather than make something up.
Make sure your app is working
One of the worst things that can happen when demoing your app is that it takes ages to load or crashes. Not only does this waste valuable time, but it can put a potential investor off.
Carry out thorough testing before the meeting to make sure your app works as it should. Check for bugs, broken links, and faulty integrations. Get everyone in the team involved – they might spot something you miss.
While you might want to show your prospective investor the latest version of your custom MVP app, it’s best to postpone any rollouts until the meeting is over.
It pays to work with high-quality developers to ensure your custom MVP app looks great and is user-friendly. We’ve put together some top tips to help you find the right mobile app developers for your startup.
If you’re not 100% confident that your app will perform on the day, stick to a video or a collection of screenshots instead. The benefit of this is that you can send the video or screenshots to your investor by email after the presentation – more on this later.
Prepare beforehand and get into the shoes of the investor
You don’t have a lot of time to run through your app and answer questions, so it’s essential to communicate clearly and without waffling.
Run through your presentation several times before the meeting, preferably with someone who can time each element and provide feedback. Ideally, you should be able to talk clearly and confidently without staring at any notes.
Also, try and second-guess any questions that a potential investor might ask. While you might not be able to predict every question or comment they have, it helps to get in their mindset and think about what they might say. If you’re not 100% on the financials or technical information, ask the relevant team members for answers or ask them to sit in on the pitch with you.
If a question frequently pops up in your pitches, it might be worth incorporating it into your presentation.
Remember that your MVP doesn’t have to be an app
Not quite ironed the bugs out of your custom MVP app, or have been asked to demo to investors before you can start developing your app? Remember that your MVP doesn’t necessarily have to be an app!
Your MVP can be anything from a website to a short video. That’s what Dropbox did to get the investment needed to move forward – a video demonstrating what the file-sharing software could do!
Ultimately your custom MVP app needs to show off the features of your app and how it solves the pain points your prospective target audience has. If it does this, you’re onto a winner!
Discover more examples of MVPs that drove startups to success
Send a thank you email
After the presentation is over and you’re back in the office, send a short email thanking the investor for their time – ideally within 24 hours, but the sooner, the better!
Include a copy of your pitch deck, answers to any questions you were asked, and any additional information you showcased during the pitch, like a video walkthrough of your app.
Investors are busy people, so an email will help them remember you and put you at the top of their inboxes. It also gives them the opportunity to go through your app in more detail and ask any questions they didn’t think of during the presentation.
Then, it’s just a case of waiting for feedback and the next steps. If you get a request for a more in-depth meeting, that’s great! If not, the feedback you get can help you understand your strengths and weaknesses in time for the next pitch. In our experience, most investors are great at providing feedback, but if you don’t get any upfront, it’s okay to ask.
Some quickfire tips for demoing your MVP app to an investor
The most important thing is not to let fundraising get you down. Startups live and die on morale. If you let the difficulty of raising money to destroy your morale, it will become a self-fulfilling prophecy.Paul Graham
By now you should know what you need to include in your pitch and how to prepare. We’ve put together some bonus tips to help you when it comes to demoing your app.
- Adapt your pitch to the investor. Different investors will want to know different things, so it’s good to plan accordingly, Do your research about the investor. What have they invested in before, and which companies have they worked for? Are they more focused on the tech, the company culture, or the financials? If they are not an expert in your industry, you might want to keep jargon and technical language to a minimum;
- Think about what you want from the investor. It’s not just about the money but the experience and knowledge they can offer. Can they introduce you to potential customers and suppliers, or give you helpful advice that can help you succeed? Some investors prefer to be more hands-off, which may or may not work for you;
- Be confident. It can be good to get into a little routine ten minutes before you’re ready to pitch – whether that’s meditating or listening to your favorite music. If you’re really nervous, having a glass of water on the table when you demo your custom MVP app can help. You can take a gulp of water to give you time when you’re thinking about a question;
- Don’t lie in or over-embellish your pitch. Investors know a lot of people and information, and if they find out you’ve told them something that’s not true, they may decide not to work with you. It’s better to be honest. Most investors will not expect your app to be 100% perfect, and as long as you can explain any gaps or issues, they’ll be satisfied;
- Take notes about what parts of your demo worked well and what didn’t. You can then revise your pitch for the next meeting you have;
- Show your passion in the demo. You might not have the most amazing or unique app in the world, but if an investor likes your determination and grit, they’re more likely to want to work with you;
- We’re often asked how you should dress for a pitch. The honest answer is that it depends! Some investors will expect you to dress formally, while others are more interested in how you present. The industry you’re in can have an effect too – the gaming and app industry is generally more casual than finance or medical. If in doubt, go smart but comfortable – jeans and a polo shirt are a good bet;
- And finally, the world doesn’t end if you get a ‘no’. Take the feedback provided, use it to enhance your pitch and move on to the next investor.
We hope this article has shown you how to demo your custom MVP app to investors. By impressing potential investors, you can get the funds you need to grow your business and develop your app even further.
Here’s to your success!
How to demo a custom MVP app to investors FAQ
Got more questions about how to demo your custom MVP app to an investor? Check out our frequently asked questions.
What is a custom MVP app and how can I use it to get investment?
A custom MVP app stands for ‘minimum viable product’. In terms of this article, it is a basic version of your mobile app with the minimum amount of features. An MVP means you can get to market more quickly and start getting feedback from your target audience.
MVPs are helpful when it comes to demoing your app to investors. You can use a custom MVP to show:
- Your commitment to your startup;
- How people are using your app, which features they like, and customer feedback;
- The functionality of your custom MVP app;
- That your startup idea has a genuine market need.
Check out all our articles dedicated to custom MVP development
Where can I find investors to demo my custom MVP app to?
There are three different types of investors to be aware of; angel investors, venture capital firms, and private equity firms. Let’s discount private equity firms at the moment, as these generally fund larger, more mature businesses. Angel investors are ideal if you are looking for smaller amounts of seed funding for a new business, while venture capitalists are best if you are looking for six-figure levels of capital.
One of the best ways to find investors is through networking, both online and offline. It’s always best to pitch to an investor you have already met, or that you have been introduced to through a mutual contact.
Alternatively, there are lists of investors online – once you’ve found investors that focus on your specific niche, it’s a case of getting in touch with them through a persuasive email.
If you’re looking to find investors to fund your custom app, this article will help
What do I need to bear in mind when thinking about how to demo a custom MVP app to an investor?
Here are some of our top tips when it comes to demoing your MVP app to a potential investor.
- Create an elevator pitch and work on it until it’s perfect;
- Keep your presentation short and punchy, and allow time for investors to ask questions;
- Take the time to pick the right investors to pitch to – you don’t have to go with the first one;
- Have a ‘plan B’ in case your technology fails on the day;
- Showcase the talent in your team – think ‘hacker, hipster, hustler’;
- Know how your app will make money and when;
- Thoroughly test your app to make sure it’s working perfectly;
- Run through your pitch beforehand, so you know it by heart;
- Remember that your MVP doesn’t have to necessarily be your app;
- Send a follow-up email after the pitch as a reminder.
How likely am I to be successful when demoing my MVP app?
It’s estimated that out of every 100 demos and pitches you do, you’ll only get one or two term sheets. This means it’s important to pitch as well as possibly to increase the chances of moving on to the next stage of the investment process.
If it makes you feel better, it’s an honor to be chosen to pitch. Many venture capital companies get 2,000 email inquiries from startups a year, so if you’re invited, you’ve done well!
Remember that you can use any feedback you receive to improve your pitch and demo moving forward. Plus, once you’re on an investor’s radar, they’re more likely to remember your startup in the future. They may recommend you to a fellow investor or agree to work with you when you’re more established.
Are there any options if I don’t want to work with an investor?
Not all startups opt to work with an investor, especially in the early stages. You have the option to bootstrap your startup by providing all the funding yourself. Alternatively, you can start a crowdsourcing campaign, or apply for grant funding.
Find out more about applying for grants in the European Union, the UK, the US, and Canada.
If you need advice on determining the best startup business models for your start-up, You are launched can help. We have been working with a wide range of lean start-ups since 2014, helping them to grow, develop and generate high levels of profit