Formulating a business plan for an app idea is an important step in the app development process. This brings the opportunity to elaborate on your ideas and take a critical look at them. In this article, we will address how to best write a business.
What is a business plan?
A business plan is created when starting a new business. It’s a summary of all your ideas about the business and how to make them work. To translate your ideas into actions it’s important to do research, make choices and analyze, and make decisions. A business plan provides insight into your position, goals, and most importantly the success rate of your app concept.
Why formulate a business plan for our app idea
Are you still doubting why you should write a business plan for your app idea? Below are 3 reasons why you should start writing:
A business plan brings you further into your thought process
By formulating a business plan you get the opportunity to write out your ideas and be critical about them. By writing down the concept on paper, you’ll notice that you will get deeper into your thought process.
A business plan helps collect investments
An app of high quality is not cheap. Depending on the specifications, the costs of creating an app start at an investment of €15.000,-, which can increase up-to a sum above €100.000,-. Another reason why people with an app idea write a business plan, to convince their investors.
A business decreases risks
When formulating a business plan, including the whole journey of the app. From idea until live in the app stores. This way a business plan can provide a good overview of the risks and obstacles.
How do you make a business plan for an app idea?
A business plan is different for every entrepreneur, but there are always some crucial parts. When writing a business plan, there always has to be thought beforehand what kind of producer or service you're going to offer, the target groups, and the competitors. How are you going to differentiate from the competition, which revenue model are you going to use, and how are you going to launch the app? Which risks play a role, are you financially stable, and are you going to use your own capital?
The minimal requirements for a business plan for an app are:
- Summary: Assume the reader doesn’t have a lot of time. That’s why a business plan starts with a summary of about 1 A4. The summary should inspire, convince, and amuse the reader. This way you make the reader want to read the rest of your business plan.
- App idea: There are more than 1.8 million apps in the App Store and more than 2.5 million apps in the Google Play Store (Statista, 2020). One question you should be able to answer is why your app is needed on the market.
- Market segment: Think about the following:
- What is the target group and what desire do you want to fulfill with your app?
- What are the strong points, the weak points, and threats (SWOT)?
- Who are possible competitors and how is your app going to differentiate itself
- The entrepreneur(s) behind the plan: This part includes a personal description of yourself and your ambitions. This part draws an image for potential investors. Think about the following questions:
- Who are you as a person?
- What is your previous experience?
- Which entrepreneurial skills do you possess?
- Why do you want to launch an app?
- The goal: What do you want to achieve and how? Which preconditions are necessary?
- The financial aspect: How much money do you need, where are you going to get from, what are you going to use it for, how are you going to earn money with your apps and when are you reaching break-even.
Complete your business plan with a demo
When formulating a business plan to attract investors, it can be agreeable to make a demo version of your app. At DTT we call this a functional design. A functional design is comparable with a drawing of an architect. The functional design creates a complete overview of all the screens and functionalities of the chosen solution. Every screen shows which functionalities they contain and how users can navigate between the screens. This way, you can show the complete concept of your app idea, and this helps generate valuable feedback. When you’re busy finding investors for your app idea, DTT can help you with strong presentation materials.
Start writing your business plan
Now that you possess all this knowledge, nothing is stopping you. But we would of course gladly help you elaborate on the above-mentioned questions. We help clients make these projects ‘’possible’’. Acquiring budgets and financials can be simplified with the help of the right contacts and professional presentation materials.
We would gladly think about your business plan with you. With a cup of coffee, we can discuss the possibilities and answer your questions. Noncommittal of course. Contact us today!
Are you still doubting what kind of app you want to publish or on what platform? Then read the following articles: