I am a single founder working on a consumer mobile app for the past 2.5 years. Primarily working on the apps retention rate to try to get some semblance of product market fit. Then when I do, going to focus on growing revenue. I have been working basically full-time on this app since my main job doesn’t take up much of my time.
I’ve held off on raising money so far, partly because I see no point in raising money unless I can hire at least 2 app developers which I estimate to require at least $500,000 in funding to do so. I don’t believe I can raise this amount. (Correct me if I’m wrong, I’ve never raised money before)
If I can only raise enough money to pay myself + expenses (<$120,000 in funding) then I might as well stay at my main job and continue working full time.
However, I’ve recently been asking myself a few questions.
Can I just hire app developer contractors instead of app developer employees for cheaper to reduce how much I need to raise?
How much do I need to raise to hire at least 2 app developer contractors?
How much can I realistically raise for my business?
If I could hire only one app developer contractor/employee would that be worth it to raise money and quit my job?
Hoping you guys could guide me in my situation. :)
My Apps 6 Month Retention - 10%
My Apps Monthly Revenue - $500 (Have not focused on this as much as retention)
TL;DR - Single founder, working on mobile app for 2.5 years. Only want to raise money if I can hire a few app developers. Not sure I can raise minimum amount I need to hire a few app developers.
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App Developer Hiring Strategy
Funding Requirements
Realistic FundraisingApp Developer Hiring Strategy
Funding Requirements
Realistic Fundraising
$500MRR is too low. retention of 10% = 90% of ppl leave within 6mths.
look at customer LTV.
better not fundraise right now. if you need to raise 500k… what % of equity would be give? since that dictates valuation.
so lets say you give 20% (which is a f*ck of a lot) - you’d be suggesting your business is valued at $2.5mil
given $500 MRR = $6000ARR
so thats a multiple of 416x
just for context, a typical multiple for a margin business is closer to 5x, startups can go to around 20x
have you considered part time or agency devs to keep that cost down?
$500MRR is too low. retention of 10% = 90% of ppl leave within 6mths.
look at customer LTV.
better not fundraise right now. if you need to raise 500k… what % of equity would be give? since that dictates valuation.
so lets say you give 20% (which is a f*ck of a lot) - you’d be suggesting your business is valued at $2.5mil
given $500 MRR = $6000ARR
so thats a multiple of 416x
just for context, a typical multiple for a margin business is closer to 5x, startups can go to around 20x
have you considered part time or agency devs to keep that cost down?