ICOs Step by Step Process & Misconceptions: Interview with Samer Saab (COO, Wala)

Part 2

Aaron Ngo

Published in

Michigan FinTech

4 min readMar 26, 2018

Introduction

Samer Saab (Michigan Alum)- BSE in IOE (2007) and MSE in IOE (2008)

MFT has given me the chance to meet outstanding and talented individuals. A few weeks ago, I had the chance to chat with Samer Saab, a Michigan alum, who is working to reduce poverty (a pretty cool mission if you ask me).

We also chatted about the ICO (“Initial Coin Offering”) process, and what it’s actually like to go through it. There are so many ICOs that it's easy to write off the entire process as a scam, or oversimplify it. I asked Samer what the process was like for Wala, and his thoughts on the current status on crypto. He was kind enough to provide thoughtful answers, which eventually developed into this article.

Step by Step Process to an ICO

Build a Community- before the white paper, an ICO requires a community. The process requires backers, contributors and a lot of other stakeholders that have to be invested in the process.
Demonstrate Proof of Concept- so you’re not just adding to the noise, you should demonstrate the value your products creates compared to other tokens. Why will this digital asset work, and how do you know that? How will this token be different from all of the others? Will it be able to grow? Demonstrating the value of your token is imperative to avoid becoming being seen as a scam or just another ICO.
Smart Contracts- these are computer programs that allow for automatic transfer of digital assets under programmed conditions. They’re used in conjunction with cryptocurrencies, and should be audited before the ICO to ensure no security problems arise that could lead to hacking theft, and other horrible outcomes.
Security Testing- to ensure the digital asset, and your company stays secure throughout its lifetime.
Legal Advice- this is important for any company, but especially in such a nascent field like cryptocurrencies. There’s very little regulation around cryptocurrencies right now (at least compared other forms of capital raising like IPO’s or venture capital). To ensure your company’s safety, legal advice is necessary.
Whitepaper- this is typically seen as the first step to an ICO, but as you can see it comes much farther along in the process. A whitepaper explains why the product exists, how it works, and why you should be the team for it. It’s the cryptocurrency version of a pitch deck, and took about 4 months to write for the Dala token.
Presale- before an ICO is available to the public, it’s usually marketed to big investors, or whales. By getting these big names on board, it gives your ICO more credibility. Some organizations will offer discounts to accomplish this, others won’t.
Go Live!- Officially launch the ICO, and start marketing/ networking to get the word out there.

According to Samer the whole process should take about 9 months and require 0.5 million — 1 million USD. He suggested anyone thinking about an ICO think of the money earned as revenue, not investments. Additionally, it’s important to continuously foster a community and ensure all relevant stakeholders stay engaged with what you’re doing.

Biggest Misconceptions

As you can see the process is not as simple as you’d think given the amount of ICO’s that have happened this year. With an ICO you’re effectively taking a company public, before even having customers. Investors can get on you for things like a roadmap, and ask why revenue isn’t increasing.
Regulators are still figuring out what they’re doing. This hampers the ability many organizations trying to do a lot of good work. As they say, “it takes a village”.
Not all ICOs are scams! There are a lot of bad apples, and Samer strongly suggested anyone interested in this space conduct their own research before investing.

Future of Crypto

The future of crypto lies in the hands of government regulators. Regulation is not a bad thing in this case and in fact needs to be the approach. So often we think of regulation as something that restricts business. Regulations can actually help businesses by legitimizing the work that they do, and making it easier for to operate. He believes that governments around the world should not take a hard stance on crypto, or risk innovation leaving the country.