Mobile App Development

How You Can Create the Perfect Business Plan for Your Mobile App Start-up

How You Can Create the Perfect Business Plan for Your Mobile App Start-up

The road to launching an app startup is filled with numerous aspects to consider such as workload, core concept, budget, product implementation, and resources. The purpose of compiling an app business plan is to put together all the key pieces of this puzzle.

As one of the best companies that write business plans, the team at Neetable has experience creating business plans for apps. Discover how to draw a business plan for your app. In addition, we've included our template so everyone can see your startup idea clearly.

Introduction

Strategy is a necessary aspect of all ventures. This is particularly true for newly formed ventures. No matter what industry you're in or who your prospective customers are, you'll be up against a lot of competition.

Businessmen never make decisions based on guesswork and speculation. Business plans are an effective tool to align a team around a vision or to raise funding.

An excellent business plan is necessary regardless of whether you are looking to raise angel capital, venture capital, or crowd-funding. Make sure to include as many learnings from interactions with potential customers as possible in your mobile app business plan.

What Is a Business Plan?

Making your ideas a reality requires a business plan. Start by visualizing the project and identifying its key ideas. This becomes the basis for the business plan.

A critical component of any project is the creation of a product requirements document (PRD). There are three sections to the PRD: business requirements, user requirements, and system requirements. A business plan is part of the PRD or the business requirement’s part.

Developing a vision, core ideas, and concepts, drawing up a business plan, and drafting a PRD prepare all stakeholders to build on the start-up’s successful foundation.

Why Do You Need a Business Plan for Your Mobile App?

The digital age has been transformed by mobile apps with a growing number of original and useful apps every few months. According to Statista,

  • In the first quarter of 2021, Android users were able to choose between 3.48 million apps putting Google's app store in the lead.
  • The Apple App Store was the second-largest app store with roughly 2.22 million available apps for iOS.

number-of-app-savilable-in-leading-app-store

When you have an app idea that will stand out from the competition, it is time to take the next step by developing a well-developed business plan for the app.

Let's now look at the benefits of a business plan.

Benefits Of Creating a Business Plan

Attracting investments

You need to choose between startup co-founders and investors depending on the kind of business model you want to use. Your only way to complete this task effectively and move on to more significant steps in developing your company is by developing an application business plan.

Reducing the risks

Recent studies indicate that writing a business plan will help you reach your goals faster. Entrepreneurs with expansive business plans have a higher likelihood of growing their businesses and increasing their revenues. Making plans can also simplify finding loans and investors.

Staying true to the strategy

It is sometimes easy to lose sight of the most important things. As an entrepreneur, you will face new challenges and obstacles every day. However, a business plan will serve as a reminder of why you began it and where you want it to lead.

Prepare efficiently

Your plan will help you gain a deeper understanding of the market you plan to target. By defining your goals, setting priorities, and building more accurate forecasts, you will improve your business's success. This is a chance for you to analyze any possible risks and find your niche in the industry.

Managing and delegating effectively

You need a business plan for your mobile app if you want to succeed. With it, you are able to see the impact of key tasks and delegate each one to the right person.

Because startup plans are unique, especially for those in the mobile app sector, make sure you come up with something that works for you.

Create a Business Plan Template

Create a Business Plan Template

Executive summary

If you are writing for investors, make your executive summary clear and concise. The introduction to the business plan might be easier to write once everything else has been drafted. An executive summary contains the following components:

Define the problem

If you know that your potential customers have a problem or a series of problems, then you are targeting those issues. Probably no effective solution is available for the issue, or the current solution has serious flaws. You must demonstrate that your app startup has a large enough customer base to make it a viable business model.

Formulate a solution

With your app idea, explain why you believe it is a good solution. Explain how it affects the pain points identified and why people or companies will turn to it as a potential solution.

What is the value proposition?

A value proposition is the essence of the value your product delivers to its consumers. When entering a new niche or designing a product entirely from scratch, defining the value proposition may prove more difficult. You must, however, use this opportunity if you are entering an established market to explain why your product is superior to a competitor's.

Define target

Investors need to know if your goals align with their portfolio when considering investment. Through thorough analysis and understanding define success.

  • Who is your target?
  • Within what period do you hope to achieve your goals?
  • Your exit - IPO or acquisition?

Market

Having an understanding of three key metrics is helpful for investors, which are:

  • Total Available Market (TAM)
  • Serviceable Available Market (SAM)
  • Serviceable Obtainable Market (SOM)

TAM is the total size of your target market. SAM is the percentage of the target market you can penetrate using various marketing strategies within a specific period of time. SOM is the size of the market for early adopters that you can access quickly.

For a market that is already established and growing, you can consult a research firm to get a sense of the market's size and projected growth. A SWOT analysis would be helpful if you face established competitors - whether they're startups or large companies.

Knowing what the challenges are will help you avoid losing money to false confidence. Having a realistic plan can also help convince someone to join your team, since they will want to know that they are working with someone who is committed to the long-term vision.

Company

How You Can Create the Perfect Business Plan for Your Mobile App Start-up

A company's team is its most important asset. Investors choose a startup for the people behind an idea.

This section entails the following details:

  • A legal entity, where the company is registered and when it was formed.
  • The number of employees and/or shareholders.
  • The location of operation. If the team also involves remote members, how do you perform operations together?

What is your company history?

The history of how you came up with the idea for the app is another significant aspect. When and how did you learn of the problem you want to address? How did you understand the market and customer pain points (e.g., developed an MVP, did market testing)? How did you form your team?

Who is on your team?

The investors want to learn more about everyone involved in the company, whether they are regular employees or those who play a key role in the overall strategy. People may wonder about the team's costs, such as salaries, insurance, and other important costs. Details about their involvement, their responsibilities, along with any previous experience they have in mobile application development or a related field.

A list of your advisory team members and how they support your startup will lend credibility to your business plan.

Marketing Strategy

During the first two or three years of your plan, your marketing strategy will change a lot. How you plan on advertising the product after its release, how you manage the community, and how you remarket it will have a substantial impact on your results. An app marketing strategy should aim for incremental achievements.

All B2B or B2C startups have a variety of strategies ranging from social media to content, PR, advertising, and referrals. Some tactics may need to be rolled out later after you've established some momentum.

Get an understanding of the cost involved, like the customer acquisition cost (CAC). Based on this number, you can understand how long it will take until you break even and start making a profit? Investors would find this information helpful.

Financials

Apart from all the above information, investors prioritize the following data also to make a more informed investment.

  • How are you going to make money?
  • What it will cost to run your business?
  • How much funding is needed?

Revenue models

For app owners, there are mainly four models for earning revenue.

Advertising

The concept of free for users and paid for advertisers works if your user base is the product that you intend to sell.

In-app purchases

Revenue from consumer apps can be generated in this way. Don't be overly optimistic when forecasting revenues - instead, base them on the percentage of purchases and use referral discounts as a way of encouraging upgrades.

Paid

Many people dislike paying to download apps, but this method can still generate revenue. It may be more convenient for you to sell your apps within the iOS and macOS app stores, as well as on your own and third-party websites.

Subscription

B2B apps are often built using this model but its gaining popularity on other platforms too.

Costs

The cost of app design and development depends on its complexity, purpose, and the resources. For a customized estimate, contact our IT experts. <link>

There will be some fixed costs for your business, such as salaries, subscriptions, and office rent, while others will increase with scale. An investor can visualize how your company will scale over time, allowing them to start making money.

Funding

Last but not least, to secure investment, you must have a clear idea of how long it will take to reach profitability and the amount of funding required. That's how much you're asking for. When you launch your app, you must determine how much equity you will give away, or what it will take to bootstrap the app to profitability.

Conclusion

The startup and app process for every technology startup is different. There is no one path they all follow. While no two journeys are alike, a solid business plan can help you approach potential investors with more confidence, and instil confidence in your team to chase a common goal.

FAQs

What is a business plan for a mobile app?

Basically, a business plan is an overview of the app's goals, creators, and paths to success. A business plan should also cover the company overview, its history, market forecasts, and financial planning for the future.

How long does it take to write a business plan for an app?

Creating a successful business plan takes between two and eight weeks.

How much does it cost to write a business plan for an application?

Your company's size and the scope of your project drastically influence the cost. For a customized quote, get in touch with us today.

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