There’s no doubt that new startups and SMEs face significant challenges in the modern age, particularly in relation to funding.
In fact, only 40% of small businesses are able to secure funding through a chosen lender, while 34% of this demographic believed that the amount available wasn’t enough to support their plans.
This issue is even more pronounced for student entrepreneurs who are looking to create a brand new gaming app, as these individuals require significant funding but lack the collateral or equity to secure this. So, how should such aspiring entrepreneurs go about funding their startup?
How to Source Initial Funding
Clearly, student entrepreneurs will find it hard to access the funding that they require in one go, so it may be wise to split the project into multiple stages. The first of these should be focused on researching the market and developing your potential business model, as this will determine the viability of your idea and the likely cost of delivering it you users.
If you come to the conclusion that your proposition is viable, you may also want to safeguard it by filing one or more patent applications. This will ensure that you’re idea is protected in the designated regions that you intend to sell into and prevent competitors from muscling in.
While processes such as conducting market research and filing for patents may not be cheap, they require relatively minimal funding. This, in turn, can be accessed through short-term and unsecured loans, which are low in value and repaid quickly to negate the cycle of debt. From a student perspective, lenders such as Smart-Pig offer a viable option, as their service has been designed for those in higher education and includes competitive repayment terms.
Launching your App and Developing an Infrastructure
With a concrete idea, accurate costings and successful patents, the next stage requires you to build your app and develop some form of business infrastructure.
This requires investment on a far larger scale, while it’s important to note that third-party investors may also be able to share their own unique insight and expertise.
One of the best ways to source such funding is to pursue investors through equity crowdfunding. This platform enables you to market your idea and core proposition to potential investors, while offering a relevant equity share in exchange for the requisite funding.