Going to be on national television to pitch my software - Need Advice
This Thursday I will be filming for a Canadian TV show where I will be pitching my software to 5 Canadian millionaires to invest in. The TV show won't air until September.
The software is ridiculously basic and it is for sports teams, specifically football and basketball teams. I made this in Adobe Flash using Actionscript.
I have been selling the software mostly to sports teams in the USA, including University teams for $20. I have sold only 32 copies ($640), but I don't advertise. I just write articles on the subject.
I have no patent on this software, since I have been doing this casually. Is it a bad idea to go on this TV show and ask them for money for a software patent? Or should I be asking for money for marketing or other things? Is it unreasonable to ask for money for a patent?
I also have no idea how much I should ask for. Apparently a US software patent (where most of our market is) is about $15,000.
I know absolutely nothing about software patents, but if it matters no other software exists that does this exact thing (however it could be easily duplicated).
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Is it Dragon's Den? I don't know if patents are an OK thing to ask for money for, but I've seen enough of those shows to know that your bigger problem is going to be your sales. 32 copies @ $20 will never make enough money to draw in that kind of investor. Even if every university (I'm estimating 2000 in US) bought their own copy, that's $40,000 *at the most*. Be prepared for some tough questions about how you'll ever make money off of it. This probably means coming up with ways to either target the mass market, or get a *whole lot more money* off of each university. – rbwhitaker 12 years ago
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Also, now'd be a good time to learn something about software patents, so that you're informed when they start asking about it. Oh, and good luck! – rbwhitaker 12 years ago
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And if any of those investors are tech savvy (and there's probably at least one) you'll want to be prepared to defend the Flash thing. Because of HTML 5, Flash, in it's current form, is nearing the end of its lifetime for most uses. (See http://arstechnica.com/business/news/2012/02/adobe-lays-out-the-future-for-flash-a-platform-for-the-next-5-10-years.ars) I'm not ragging on your implementation choice--just be prepared to explain why you chose it, and why/if you'll stick with it going forward. – rbwhitaker 12 years ago
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Hey guys thanks for the help so far. There are 35,000 High Schools in the USA and 5000 Colleges. But this can be sold to virtually any football or basketball team in the world. So my target market is probably 100,000 if this helps. Also I don't think the judges are going to know about the "end of flash" so im not worried about that right now. **If anyone else could add some advice I would really appreciate it! ** – Mike 12 years ago
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I doubt what you have is patentable. They are unlikely to take you seriously if you think you can patent it. – Tim J 12 years ago
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Sorry, even 100.000 possibly markets only makes this a couple of millions revenue ever. Maximum - nice fora singple pprogrammer, epic failure level for a startup. – Net Tecture 12 years ago
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It's "Chinese math" of market estimates: there're 1 billion people in China and roughly 50% of them are women; if just 2% of Chinese women buy my product at $20, I'll make millions! No, you won't - the cost of reaching those customers is insane and $20/unit won't get you there for the most part. – Dnbrv 12 years ago
2 Answers
Ok the protection issue is going to come up, you can probably say that is part of what you are seeking funding to cover.
AS others have pointed out the real questions will come around
How are you going to sell it? Once of price, per month subscription, per user subscription?
How big is your market?
A comment mentions 2000 clients which is not enough for the price tag, but you could do a per user which may be 2000 users in 2000 uni's @ $5 per month ... now that is worth listening too ... or it could be free to these users with targeted sports related advertising aimed at the exact user, which is a valuable demographic to the right advertiser.
NOTE: The current price and current market you can say is a beta/early adoptors price but you need a better answer to the question.
How much of that market can you capture in 6 months, 1 year, 2 years?
Its useless if you can only sign on 1 per month because thats only 24 new ones per year ... unless your charging $75,000+ per install you won't cover your costs ... seriously I know :)
Realistically can you sign up 100 new users per day for 24 months ... again worth listening too.
Do you have others who can help you grow?
As you grow you will not just be developing and blogging (well not if you have investors, if your going solo then sure). You will be doing marketing, sales, support, PR trips, trade shows ... oh and development too. Each of these take time and specific skillsets, which cost money, which is why your asking for funding.
Have a read of my answer on this question about what it takes in a startup. Do the work to know these numbers ... the answer you come up with is how much you should be asking for.
To wrap up :
Do NOT talk about the functions or features of your product, they don't care much ... if the market likes them enough to buy it that is all you need to cover as far as the technology is concerned.
Do look at the benefits to the market, it allows them to do SO MUCH more. My advice is ring up or email all of your current 32 end users and ask them
- What benefits did you get out of using the application?
- How much time did it save you?
- Would you subscribe to it if it was a service?
- If I was to go commerical would you pay $1000 per month, $500 per month, ... etc until they say "yes" without a lot of hesitation. Over the 32 it will give you enough of a feel for the pricing for now.
This is a set of broad brush strokes to give you a feel for what you need to do to prep for this thing.
- How much is it going to cost you to build this thing?
- How are you going to make money from this thing?
- Is it going to make 4x to 10x between these 2 values?
- What do you need help with? This is essential, don't lie but have a plan to get this hep.
- What do your existing users think, how engaged are they. This is critical, if they all love it you have an essential first step. Anyone who knows what they are talking about will listen if you have that qualification in place ... the pricing and skills can be fixed if you know its something worth fixing.
Good luck.
Focus on your product. Asking for investment in a patent is a no-go. The patent is completely useless if the product doesn't sell and if you don't have the backing to actually litigate with it.
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But I feel like there not going to invest in something with no patent. So do people ever actually ask for an investment for a patent from investors? – Mike 12 years ago
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All investors want to know that you have some form of protection. Protection doesn't necessarily mean a patent - they're just looking to see that you have some competitive advantage. (Check out http://en.wikipedia.org/wiki/Porter_five_forces_analysis to see how they would judge your competitive advantage). Having a large user base is another popular "protection", and explains why twitter (which is super simple conceptually) is so valuable. You might be better off suggesting that you'll use their money (and all your profits) to vastly expand your user base. – John O'connor 12 years ago
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ok guys i decided to not ask for a patent but rather to get this developed into mobile application, improve the look of the software, as well as help with marketing! – Mike 12 years ago
