By: Kevin Schreck
There’s no doubt that current economic conditions have created headwinds for nearly every facet of our lives. This becomes even more pronounced when looking at the prospect of large development expenditures that may or may not have immediate returns.
Let’s take a look at how macroeconomic conditions can affect your development and ways in which you can position yourself to make the current market work to your advantage.
Start with a Plan
Whether you’re starting from scratch or looking to add additional features to your software, we highly recommend that you begin your efforts with a well thought out business plan. When creating this plan it’s important to consider the following:
- View the plan from multiple lenses.
Perspective is vital. And that includes taking into account a view other than your own. Think about your users, investors, partners, etc as you develop your plan - Take into account the macroeconomic factors.
Assess market price sensitivity, availability to capital, availability of human capital and other factors that are sure to impact your success. - Understand the why of what you’re attempting to undertake and how current market conditions fit with it.
For example, in a market downturn people are very often looking for ways to cut costs. This may be an area you’d wish to address with either an application used by external users or something that addresses efficiencies within your own internal operations. - Remember it’s the act of planning that is most important, not the plan itself.
Things are going to change, but it’s important to have things thought out.
Determine a Funding Strategy
Building software comes at a cost and until recently, access to capital for projects has been historically cheap and easy to attain. Low interest rates and novel technology had made the palatability of taking out capital and the ease with which it was acquired as efficient as it has ever been.
But markets are cyclical and as with all things they change.
Recently, interest rates have risen dramatically and with that the access to capital from banks, VC’s, Angel Investors, etc has become more difficult.
If you can bootstrap your efforts this is likely a good time to go that route, however in many cases that just isn’t feasible. Think about what you have at your disposal and leverage your business plan to determine a rough return on investment. If you’re looking to investors, determine what you’re willing to part with in terms of equity and also the expectations you have on your investors’ involvement.
As mentioned earlier, as you seek capital, a well articulated plan will be critical to reducing the risk on your financial backers and securing the best possible deal for your funding.
Consider Phased Development
We all want to go to market with the complete package, but often that’s not really necessary. Other times, we just need an MVP in place to get to a pilot group or have a demoable product for investors.
At Elevate, we guide our clients through a phased approach to development that’s specific to their needs. We take into consideration their key stakeholders, budgets, timelines, and other factors to develop a phased approach that spreads out their expenditure while also focusing on key near term targets and allowing for adjustments as long term targets change.
As you start your technology journey, begin to think about the nuances to your market entry. What are the must-have features for your application’s production release? Can you focus on a subset of features that get you to a revenue generating beta release? Are there high cost features that you can defer out to a later release when you have steady revenue? These questions can help you to plan the most effective timeline for your development.
Choose a Development Partner that Understands You
The right development partner will have experience with all of these elements and work with you to cultivate a situation that fits your needs.
One of the advantages of working with a development partner is the ability to spread your costs over time without the incurring of the costs associated with internal labor while you’re not in a development-focused mode.
Our team at Elevate maximizes your value while expediting your path to revenue and sustained growth. We give you the flexibility to chart the path you need and the nimbleness to scale rapidly when the time to run hits. We’ve been at this a long time. Leverage our expertise to guide you through your challenges.
Interested to hear more or just want to discuss what we can do with your specific needs? You can ping me directly at kevin@elvt.io or go straight to my calendar.
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