Startup Funding Espresso – Using Prototypes To Raise Funding

Using Prototypes To Raise Funding

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In raising funding, a prototype is invaluable.

Here are some reasons why investors fund projects that have a prototype:

The prototype demonstrates you can build it.

It gives you a tool to engage customers.  

Prototypes help you define the product better by observing how the customer interacts with it.

Prototypes help validate the market and customer acceptance of the product.

Prototypes help build a better financial forecast as the cost to build and maintain the product becomes more accurate.

Prototypes help recruit team members who can see the vision of the company coming to life in the product.

Prototypes help define the intellectual property better.

Prototypes also help recruit partners, suppliers, and contractors.

Many startups skip the prototype phase and go straight to building the first product. 

This can be challenging as the cost to build a final product is much greater than a prototype and therefore requires more funding.

Consider these reasons in planning your product launch strategy with a prototype.

 

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

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