A friend who wants to make an app asked me why anyone would need investors to help bring an app to market. She asked "what would we need to pay for?"<p>How should I answer her?
It depends on the app. If it's something like Flappy Bird, you won't have much in the way of expenses. If it's something more substantial, you might need to hire designers and developers to build the app and make it usable. You may need ops people to keep it running. If it's not inherently viral, you may need marketers and a budget for ads and PR. If you're doing something novel you might need to file patents and hire lawyers. You might need to pay for servers, storage, and bandwidth.<p>All that costs money. It might be more than you have in your checking account. That's where investors come in handy.
Unless the app is completely self-contained, you're going to need to pay a hosting company to provide you with server hardware and communication bandwidth.<p>If you want to market your app to people, you'll need to pay for ads.<p>However, most investors aren't really going to be interested in funding something unless they're convinced that there's a good chance it can make a lot of money. If all you want to do is create a small-scale project that doesn't need to support a lot of users, you could fund it out of your own savings.
Servers and marketing are the two big money hogs.<p>Also you need to think about the time spent and income being made. Getting investments mean you can treat it as your full time job and not worry about dipping into your own savings after your 3rd month of advertising without getting much return.
Money can help you do the right thing faster if you know the right things to do. Otherwise raising and then spending money a little better each round can end up in focussing on the investors as being the customers of your business. If you consult at a medium-high enough level, you can probably raise a fair amount of money yourself and self-fund.<p>It really depends on the app and if there's market demand ($) for it beyond just users.<p>If it's the first app, learning how to make money is more valuable on a smaller project than building something big and having less of an idea.