How to Launch a Successful ICO?
It all started with a whitepaper launched by someone named Santoshi Nakamoto. Yes, since the launch of Bitcoin, we have seen a wave of change wash over how technology and businesses are conducted today. From the various applications of Blockchain to token sales and Initial Coin Offerings (ICO), it has been quite a change.
Initial Coin Offerings have become a popular method of raising funds for startups through the blockchain projects they develop. The way it is going today, the year of 2018 is expected to show a remarkable progress in the number ICO based projects.
Statistics show an increase in the fund collected in the previous year of 2017 with a trade of about $2.2 billion being conducted. This is in comparison to the $62.6 million deal that was raised in 2016. However, the rate of failure of ICOs, as in the number of ICOs that failed to meet its required caps also stands high.
This article is aimed at guiding you through the various steps that would result in a successful ICO. If you are waiting to launch your blockchain based technology in the blockchain market or are planning to host an ICO for the very first time, this article is definitely for you!
Let’s start at the beginning,
Understanding an ICO
An ICO can be described as a kind of crowdfunding procedure where the organization sells all or a portion of their cryptocurrency token for the first time, to the general public. The concept of ICO first came up in 2013 when J.R. Willet administered world’s first ICO for the launch of his venture, Mastercoin. At the time, it succeeded in raising the desired amount.
Although Mastercoin does not exist anymore, the funding model was adopted by many other cryptocurrencies and businesses.
Want more news about ICOs? Read here
Why should you have an ICO?
This question ought to be answered convincingly before bringing in a team to plan for the ICO. Sit down, take some time and evaluate all the pros and cons of conducting an ICO. While analyzing this take into account the following factors as well.
· Will your business benefit from token distribution in long time?
· Will your token have utility?
· What benefit will your project add to the crypto/blockchain platform that is not already provided by another?
· What token distribution method would suit you?
· How do you plan to issue and receive contributions?
· What will be the use cases of your token?
ICO is similar to an IPO in many cases but is more flexible than the latter. While with an IPO you buy a portion of the company in itself, it’s not the case with an ICO. Also, ICO is bounded by much lesser regulations than an IPO.
Know the difference between an ICO and IPO, read here
To launch a successful ICO
· A research of due diligence for your ICO
The ICO platform is one of the most competitive one’s today. For an investor to invest in your project, you would need to pass some degree of due diligence from them. Hence, to pass this evaluation make sure that you know what this due diligence consist of. Watch ICO reviews and videos to understand the key influencers and their way of analyzing ICOs
· Why Blockchain?
The answer to this question is crucial for the future of your business. If your project can be realized with a much simpler technology or database, investment can be seriously affected.
Want to understand Blockchain technology in detail, read more
· A well-crafted whitepaper
A well-crafted whitepaper created by professional outlining the project specifics, working and other features clearly are expected to fetch more investors.
· A working prototype
Launch your ICO only after creating a working prototype. It doesn’t matter how limited the scope or how small the size is. Investors are always attracted to getting an opportunity to see the project in action before the development is carried out.
· 24/7 coverage
Not everyone reads the whitepaper. Even if they do, they will still have questions that they would need to clarify before investing in your project. Set up a community team with 24/7 coverage to cater to these needs. This would help increase your reliability with the investors.
· Local rules and regulation adherence
Intelligent investors may find it difficult to invest money in projects that are not legally abiding. So, make sure that your project abides by the laws of the place where it is based in.
· A well in place KYC and legal counsel
Allocate money in your budget for legal counsel and perform KYC strictly. This would ensure that you are caught off-guard in case regulations gets tighter in between the ICO.
· Set individual maximum caps for the first day
Set individual maximum caps for the first day to give fair chance to everyone. This would put a limit on the number of tokens to be bought by an individual in a day. In case the hard caps are not met by the subsequent days, remove the cap and accept investment as it comes.
· Determine the hard cap
It is essential to determine the hard cap and to be explicit about it. This is because influencers and investors feel more comfortable and trustful if they are able to analyze these details.
· Publish an all-inclusive FAQ
A clear understanding of a project draws more investors. Draft and publish an FAQ that offers a comprehensive insight into the project, by covering all questions that can occur to an investor.
· Test before the launch
It’s important to test your project before you launch it. Excuses and errors can be quite bad for your project. So make sure you present the perfect system.
Learning from the successful ICOs
Learning by example is one of the best ways to learn and so here are some ICOs that have met with immense success.
So, if you plan your project as mentioned and you are not looking for a fast blockchain cash-in, your project has a very high chance of meeting with success!
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