Without an effective post-ICO strategy and implementation, negative feedback and PR can negatively impact a startup before they’ve had a chance to launch.
Most companies pour their energies into the ICO stage. They perceive it to be the most important aspect of building their startup: If they can convince investors to pay for tokens and are able to meet their capital target, then the battle is already won. But without proper planning for what comes after, the business can lose its momentum, even if it has sold all its ICO tokens.
In 2017, the average return on an ICO was 5.7 times the original investment, or $5.70 for every dollar invested. As the tokens grow in value, it’s important to manage spending effectively and keep to a budget: There are a number of areas that management teams need to invest in to ensure that every aspect of the business is handled effectively to ensure success.
For most companies, the following core areas need a budget:
- Software development
- Business development
- Operational expenses
- Legal costs
It may also be worth setting a proportion aside to budget for unexpected costs.
Anticipating and Reacting to Setbacks
Although it would be wonderful if everything went according to plan, this is rarely the case — and consumers won’t be disappointed if it doesn’t, as long as they are kept in the loop.
Setbacks can be disheartening, but a vague statement can be even more irritating: A company that explains how it’s been affected by the loss of a staff member, misjudged funding needs, or any other factor builds transparency with its audience. Instead, keeping your token holders, stakeholders and partners up-to-date with an email newsletter or Medium article. You don’t need to take the Buffer approach of ‘radical transparency,’ but some timely and relevant transparency is useful.
Preparing for Competition
With the popularity of blockchain technologies continuing to grow, most businesses will find that there are similar start-ups competing for their share of the market — or if there aren’t currently, someone will attempt to do their own version of the same idea. Some of these may be more established, and so it’s important to consider how you will stand out from the crowd, not just with the efficiency of your product but also with what else your business can offer, including valuable content and customer service.
Capitalize on Initial Excitement
Although it’s natural to want to relax and bask in the glory of meeting targets, but don’t allow the hype of success pass you by. Ride the enthusiasm from meeting the target and maintain momentum with regular updates and relevant blog posts until the application can be released.
Design and Presentation
A website’s ICO landing page is designed with the selling of tokens as its primary focus, with calls to action and deals for bulk purchasing. At that stage, meeting capital targets is the main goal — but what about when those goals are met? Users coming to the website shouldn’t be met with the same calls to purchase, but instead have more of a sense of you as an operating business.
With initial estimations pre-ICO as well as developing projections post-ICO, it is vital that the company does not over-reach on its promises in a bid to attract buyers. Modest but achievable objectives will achieve trust between the company and its token-holders, and while bold claims might gather investors initially, it will only backfire when it appears that the company cannot keep to its goals.
Although it’s prudent to keep expectations modest, it’s always best to be prepared for success. Scalability is a major concern for any blockchain token, and investors will want to know how the application will be managed as users and transactions increase.
Keeping Investors Informed
It may seem proficient to show only the leap from start-up to fully-fledged operational business, but users know this is not realistic. Giving token-holders regular updates about how applications are developing and how the business is working to reach its goals creates transparency and trust between both parties.
SEO, Marketing, and Social Media Engagement
A business that exists in its own vacuum is unlikely to enjoy prolonged success, particularly when it is still in its infancy. Communication is key. Without it, it is easy for users to allow a company to fall by the wayside.
As the website is developed, particularly with relevant blog posts and articles, SEO keywords will power further growth. Without them, new users are unlikely to find the site by chance from search engines.
Many companies often forego social media interactions in favour of developing software and an impressive website, but social media engagement is vital for business development. The public’s trust in the brand is cemented with regular updates, whether that’s through newsletters for token-owners, social media posts for those interested in the brand, or on appropriate third party websites (such as cryptocurrency blogs) to reach a new audience. This also creates a community, which encourages use of the application.
Live chats, webinars, and AMAs (Ask Me Anything) on sites such as Reddit are also excellent ways of interacting with people in a more personal fashion, so that they are able to not only get direct answers to specific questions but also get to know the human element behind the brand.
Proper Documentation and Legislation Compliance
Legislation compliance is perhaps not the primary factor that an investor will consider before buying tokens, but it makes a massive difference when the application develops from pre-ICO to post-ICO. Tezos, which raised $232 million in its ICO, has failed to launch and is facing multiple lawsuits, as well as its co-founder being recently fined $20,000 and banned from broker-deal interaction for two years due to a failure to disclose outside business activities.
ICOs are particularly attractive to hackers, and it’s important to not only follow through on promises made in the whitepaper, but also react to newly developing threats. Some businesses content themselves with placing protections against threats without considering what would happen if there was a successful attack. A crisis plan is an extra layer of security, both so that developers are aware of how to react if something goes wrong and for increased confidence from token-holders.
It’s impossible for one team of developers to be aware of all possible attack techniques or flaws in their system: Interactions with the rest of the cryptocurrency community are effective ways of highlighting any weaknesses that may not have been spotted or factored in.
Ultimately trust is the primary currency exchanged between the business and its investors, and with the purchasing of a token the buyer is placing their trust in the company, which can be repaid with transparency, developmental and business updates, and adhering to promises made. BitRewards’ transparency and openness is instrumental in gaining trust from its users, and with trust comes loyalty.