Some advancements in technology are so vividly pronounced that it has an impact on our lives and our everyday activities. Some of these technologies, although they have the potential to change the lives of a common person, do not get into limelight until they are fully mature. However, under the hood, they have been slowly gaining their credentials and have been slowly displacing a few traditional methods that have been in existence for decades if not centuries.
If there is one such thing that can fall into this category, it is the Initial Coin Offerings. Initial Coin Offerings are commonly abbreviated ICOs.
What is an ICO?
An ICO is a passively non-regulated, blockchain-based method of crowdsourcing funds for a crypto project. The investors are issued a token that promises them either a utility in the product or service being funded. Upon successful acceptance by a cryptocurrency exchange, the token can entitle them to monetary rewards.
For quite a long stretch of time, ICOs have been viewed as the finest entities of confluence between a traditional fundraising system and a modern technology like blockchain. In effect, it can be considered the proper equivalent of an IPO in the context of crypto projects.
The Dark Phase
Initially, ICOs were totally unregulated, meaning there was no solid legal backing to the funds that were collected. This led to ICOs being dubiously marred with scams. However, regulatory bodies stepped in at the right time, making ICOs more regulated and streamlined, much to the delight of genuine fund-seekers in the crypto space.
There might be alternatives like the Security Token Offering (STO) and Initial Exchange Offering (IEO) but all of these have not stopped ICOs from reaching the top spot in the list of fundraising methods for crypto projects.
Launching an ICO
There are four stages involved in launching a property in ICO: the preparation phase, the pre-ICO phase, the actual launching of the ICO, and the post-ICO phase. Every step involved here is of crucial importance in determining the success of your ICO.
The Preparatory Stages
This is the stage in which you will strategize your ICO in the most nascent stages. It is crucial to understand your market needs and your competitors, so you can strategize and position your project accordingly. You need to come up with a plan that leads into a proper execution rather than just confirming itself to the concept.
Generally, most projects that seek funds through ICO are based on blockchain technology. However, it is not mandatory that your project needs to be in the territory of blockchain or crypto.
Although there is no rulebook for success in ICOs, there are a few factors that have been known to positively influence investors. It is good if your project is decentralized as it is one of the governing philosophies behind the creation of blockchain as a digital ledger. Instead of just one company being involved in the project, it is recommended that there are multiple parties involved. It adds to the credibility and the magnitude of the centralization. The product should display the potential to scale up at a global level. Instead of presenting the product as a manifestation of technology, it is better if the product is positioned as something that solves the problem that users are facing.
The White Paper
The white paper drafted for your ICO is considered the most important document in the entire process of launching your ICO. The white paper should contain all the essential information that investors would look for before investing in your project through the ICO. The readership of the white paper might be limited but it is to be noted that if there is someone who takes an effort to read through your entire white paper they are very likely to invest in your ICO. Therefore, it is important to include all the necessary details.
The details in the white paper can include the problem being phased and the way in which it is being addressed through your solution. It should also speak about the audience who will primarily be benefitted from the solution. It should give a detailed analysis of the market and shoot back the product and its relevance with specific statistics.
In addition to the product itself, it should also detail on the ICO, the tentative schedules and timelines, and the development strategy. In addition, including details about the team of professionals and their highlights, credentials, and experience will help in strengthening the credibility of your ICO.
The website is considered the primary point of culmination for your ICO. It is quite possible that people who look for an ICO option in bitcoin or crypto forums will land on your website. Therefore the website has to be made complete, understandable, and easily navigable.
There are considerable chances that the website might be the first among your communication that people see. Therefore, your website needs to address the needs of everyone starting right from first-time visitors to seasoned traders who are almost committed to investing in your ICO.
In all of this, it should not be forgotten that your website needs to comply with the classic best practices. The website should include stunning visuals, videos, infographics, and if possible, even a proper roadmap and a pie chart for addressing the timeline and the distribution structure of your tokens. It is mandatory that you have your contact information and customer support within your website itself.
The Crowdfunding Parameters
It should be remembered that the ICO is nothing more than a crowdfunding operation built on blockchain technology. Therefore, all the rules that apply for crowdfunding should apply for ICOs as well. There are a few aspects like the minimum cap, the maximum cap, the token allocation, and the status of unsold tokens that need to be figured out before you launch your ICO.
Meticulous care has to be taken in ensuring that these numbers look healthy. For example, if your minimum cap is about $1000 and your maximum is about $1 million, people might not look at your ICO seriously!
Making the Information Public
Now that you have figured out all the above aspects, you can announce your ICO on websites like ICOBench, ListICO, and ICODrops. These websites should also contain information about your team, the timeline, the milestones, the white paper, and the token distribution method.
Creation of Proof of Concept
You seek funds for an idea that needs to be made into a product. In short, your 'concept' needs a ‘proof.’ To develop the proof of concept, you will need to have a theoretical build-up that will explain every aspect of your project. To showcase the viability of your project, you will need to build a prototype before you go on to build the minimum viable product that will help test the hypothesis and feasibility.
At this stage, you will also need to contemplate on creating your utility token. Before you proceed to create your tokens, you will also need to figure out certain important quantities like the number of tokens, and the distribution of the token available for selling at different stages. When you use pre-existing blockchains, there is no need for you to build a completely new blockchain from scratch. Your token will also need to inherently house the smart contract which is nothing more than a small code or software that helps control the functionalities including but not limited to transfer of your tokens.
To ensure that your ICO does not falter in terms of credibility, you will need to ensure top notch security. The crowd sale smart contract should be meticulously designed in such a way that it can defend itself from attacks. In addition, you will also need to keep up the security of your website and your network through simple and established mechanisms like secure sockets layer and secure transfer protocols.
Marketing and PR
More than just announcing your ICO, you will need to engage in aggressive marketing and PR activities. It should not be forgotten that your marketing activities will cost you quite a lot. You can consider using the classic arsenal of digital marketing activities like Google ads, social media, engaging on forums like Reddit and Quora, and even email marketing through an email list collected from your website.
In addition, you can also engage in certain marketing activities that are specific to ICOs and anything to do with the crypto space. These activities include participation in crypto forums, bounty marketing, influencer marketing, and airdropping of your utility tokens.
The crowd sale, without question, is the heart and soul of your ICO. This is the point in time where your company sells your utility tokens in exchange for money. Therefore this step has to be dealt with meticulous care. More often than not, your website serves as the platform for the buying of tokens. In addition to fiat currency, your ICO platform should also support the purchase of tokens using mainstream crypto coins like Bitcoin and Ether.
The time during crowd sale can be considered a brisk and busiest period of your ICO. Therefore, you should actively engage with the community and participate in discussions. It is quite possible that questions and discussions about your ICO might spring up in almost every platform including but not limited to crypto forums and social media. You should have a team that is entirely dedicated to addressing issues on these platforms.
After your launch…
The greatest responsibility in your ICO starts only after you have acquired the essential capital. You are now expected to build the product that you promised your investors in the first place. It is important to comply with the roadmap, so you can increase or at least retain the magnitude of trust that your investors had on you.
In addition, you also have to introduce your tokens on exchanges, so your investors receive some tangible values out of their investment.
Going against the notion of evolution, it is not always about the survival of the fittest but even about the arrival of the fittest. If the ICO has been the harbinger of unifying traditional investments and modern technology, there has to be some validity and credibility to the process.
If you would like to fund your crypto project using an ICO, all you need to do is get in touch with an ICO development company. They will take care to understand your business requirements and address all your ICO needs from end to end.
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