8 questions to answer before launching your ICO
If you can answer these 8 questions objectively and truthfully then you are on the track to do a successful ICO.
Before deciding to ride the blockchain wave, it is important to be crystal clear about a few important questions, lest it lead to wasted effort, time, and disappointment in being unable to raise the expected funds. Try to answer the following questions in as much detail as possible, so that you have complete clarity in your mind which you will then be able to translate to an investor
1. Does your Idea really need a Blockchain application?
Find out if your project can function well enough without integrating it with blockchain. Is there a real need for it, or is your project just trying to comply with the latest fad? This is a crucial question to ask yourself, because investors will be skeptical to invest in a project where there is no immediate requirement of a blockchain solution
How is centralization of data being a challenge in the industry you’re dealing with? Will a distributed ledger help solve that problem?
2. How are your competitors trying to solve the same problem?
Do you have any competitors who are trying to solve the same problem using blockchain?
How is their solution and business model different from yours? Are they successful? If not, why, and how will you overcome the challenges they had? If they are successful, why are you looking at getting into the same space? How economical are you compared to them?
What is your USP? Do you have a disruptive model or a unique product?
3. Do you actually need your own cryptocurrency?
Do you really need your own token, or is it just for cosmetic purposes? List down the reasons why you need your own token
The crypto market is highly volatile. Keeping this in mind, do a risk vs reward analysis for issuing your own token
4. Does your token have a big enough use case?
Does the problem that you’re trying to solve appeal to a big enough target market? What is your target market size?
How is it useful for each stakeholder in your industry’s ecosystem?
How can it be of use to potential future users?
5. Who is on your team?
Does your team have enough credible people that will seem attractive to a potential investor? What are their credentials?
What are the various skill sets your team members are equipped with?
As mentioned earlier, this is a highly volatile market. Is everyone in your team driven to weather storms in the crypto market?
Can your team execute the dream you want to build?
6. Why would someone invest in your token?
Every investor invests with the aim of gaining returns. How will your project generate money? How long will it take for it to become profitable?
What is your proposed roadmap and strategic vision for the next 30 months? How are you planning to scale?
Why should an investor invest in your token over the others in the market? What’s in it for them?
7. How do you plan to use the funds raised?
What percentage of the funds are you planning to allocate for various functions like sales and marketing, legal, technology, bounty programs and so on
8. Is there a ready prototype for your product / technology?
Anyone can have an idea. Ideas are useless unless they are acted upon. Investors obviously know this. Keeping this in mind, do you have a working prototype of the idea you are proposing? What are the challenges you’re facing with the prototype? What are the areas you can improve?
Answering these 8 questions in total candor will not only put you in a better place to tackle questions from investors, but also give you clarity as to why you are doing what you are doing. It will also help you explain your project better to your community and future stakeholders. Take your time, introspect, and document your answers for you to refer back if you feel stuck any time.
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