When you’re trying to get your product off the ground, it can be difficult to find the right investors. You might have a great prototype, but investors are not only interested in prototypes; they want to see real sales and demand for the product.
By demonstrating that there is a real market for your product, you’ll be more likely to attract the investment you need to get your business off the ground.
Why Investors Wont Save Your Product
At the end of the day, you must realize that investors don’t care how innovative or amazing your product is. They just need to know that it wont be a financial risk to invest in your product.
Real investors want to see positive cash flow, sales data and demand before jumping in and investing.
Have you ever watched an episode of SharkTank? What’s the biggest turn-off for the sharks?
When the entrepreneur comes on the show without any sales and only a prototype…
I’m not saying acquiring a deal with only prototype is impossible, I’m just saying that it dramatically decreases the chance of securing an investment deal.
If you truly believe in your product don’t just pursue the licensing route, try to start a Kickstarter to show that there’s desire for your invention, then use the funding to develop & manufacture a small batch, and then you can start building up your sales.
Heres Our Guide To Starting A Kickstarter
First we would recommend getting some form of visualization or prototype to demonstrate your idea. Heres a list of different ways you can visualize your idea.
- Concept Sketches
- 3D Model
- Photorealistic Renderings
- Video Of Physical Prototype In Action
Steps To Get Started
- After you have a way to demonstrate your invention clearly, you must then move on to protecting it. You can apply for a provisional patent which will protect your idea for up to one year. After that you must file for a design or utility patent.
- The reason you need a patent before posting on Kickstarter is because the second you share your idea on any public website or social media, it becomes unpatentable. SO make sure its protected before posting anything about it.
- Ok so after youre product is protected you can move on to posting it on Kickstarter, this part is straightforward it just includes signing up for a Kickstarter account and posting your product.
Bonus Tip: The more pictures and videos you have the higher chances of getting donations.
At first, send it to friends & family and ask them to repost & share it as much as possible.
But it doesn’t stop there, you must begin marketing your Kickstarter.
We have a full guide on “How to market your Kickstarter product” coming soon.
But for now here are some quick tips on how to market it.
- Make TikTok/IG Reels and link the Kickstarter in your bio
- Run paid ad campaigns on Facebook
- Network with other inventors on Facebook Groups or similar
- Find influencers that are relevant to your product and see if they would like to review your product idea
- Start A YouTube Channel
If you follow all these tips & tricks you should have a fully funded project thats ready to move on to development.
Can I Just Skip The Prototype?
The simple answer is no. Even though investors might not be interested in a prototype without any sales data behind it, it doesn’t mean you should skip a prototype.
In fact, its impossible to continue on to manufacturing without prototyping your product first.
What Is A Market Analysis?
A market analysis is a report that provides information about a particular market, including the size of the market, the trends within the market, and the competition within the market.
Market analysis reports can be used to aid in business decision-making, as well as in developing marketing plans.
Why Is It Important?
A market analysis is important because it helps businesses to:
- Understand the size of the market for their products or services
- Identify trends within the market
- Understand the level of competition within the market
How Is It Conducted?
There are a number of different ways that a market analysis can be conducted, including surveys, interviews, focus groups, and secondary research.
What Are The Different Types Of Market Analysis?
Some of the different types of market analysis include:
– Consumer market analysis
– Business-to-business (B2B) market analysis
– Industry market analysis
– Competitor market analysis
Create A Business Model Of Your Invention
The first step in acquiring investment is to have a business model of your product or service. This means creating a document that outlines how your business will make money.
There are a few different ways to do this, but the most important part is to be realistic about the costs and revenue potential of your invention.
One way to create a business model is to use the Lean Canvas method. This involves creating a one-page document that outlines the key parts of your business, including your value proposition, customer segments, channels, and financials.
Another way to create a business model is to use the Business Model Canvas method. This involves creating a nine-block diagram that outlines your value proposition, customer segments, channels, customer relationships, revenue streams, key resources, key activities, key partnerships, and cost structure.
Once you have created a business model of your invention, you can then begin to look for investors.
Some places to look for investors include:
– Family and friends
– Crowdfunding platforms
– Venture capitalists
– Angel investors
– incubators and accelerators
When looking for investors, it is important to remember that they will want to see a return on their investment. This means that you will need to offer them equity in your company.
In conclusion, finding investors while only having a prototype may be difficult but to the truly dedicated inventor there are many ways to overcome this hurdle, like the ones we outlined in this blog.
We hope you found this article helpful and we wish you the best of luck on your invention journey!