Guide to an STO: How Long Will It Take To Raise Funds?
If you ask any project founder about the desired time frame for raising the necessary funds, the answer will be ‘ASAP’.
It’s no surprise since the very concept of public token offering implies an urgent need for funding. Indeed, there’s no need to opt in for a Security Token Offering if you already have a budget of your own or expect to receive an investment anytime soon.
Given that, timing is crucial for fundraising, especially for innovative projects, since the competitors are always around, ready for the turf war. That’s why we at Priority Token get the timing questions almost from every client. Today’s article is the next episode or our STO Essentials series, and it will cover the topic of setting a timeline for your project.
What Has An Impact On The STO Timeline
Technically, creating a token and launching a token sale takes mere hours. However, there’s a lot more to a successful and legally compliant token offering than a straightforward sale procedure. Here are some essential steps that you should take.
1. Doing a Market Research. You don’t want to spend time and money on launching a project to find out later that there is a similar offer, or product, or concept out there. What is more, not every groundbreaking idea makes the best selling product. To make sure your efforts are not wasted, undertake a careful study of the current market situation.
2. Putting Together a Team. The people behind the project do matter. Ensure that you have all kinds of talents in your team, and they all are eager to work together with passion and creativity. Also, don’t forget about the advisory board. Negotiations with advisors can be time-consuming.
3. Selecting a Type of Asset to Tokenize. You can choose from a variety of options, including debt tokens, equity tokens, and more. Take time to consider what will work best for you and your investors.
4. Sorting Out Legal Issues. Full legal compliance is what makes STO a solution of choice for many enterprises. But it also takes time to settle, so make sure to schedule an adequate time frame for this part of the job.
5. Configuring Your Token sale. How will the contributors undergo KYC/AML procedures? What will be your Hard Cap/ Soft Cap? Will you set a maximum percentage ownership per user? Will there be a token lock-up period? This also includes configuring your smart contract, and all the other tech work.
6. Creating the Basics. Making a website, a whitepaper, a one-pager, a promo kit, a blog, social media accounts, etc., is also a groundwork that takes time.
7. Outlining a Marketing Strategy. To get the exposure you need, you have to devote time to planning a full-fledged marketing strategy. Be sure to include collaboration with influencers, media coverage, social media management, bounty, road shows, etc. Your goal is to reach out to your audience in every possible way.
These 7 steps make up the key part of a pre-STO period. After you get everything done, the time will come for the token sale itself.
And What About Exact Time Frames?
How long will a pre-STO take: a month, two months, half a year? Or maybe it is possible to do everything from scratch in as little as 2 weeks?
It all depends on your project’s scale, your fundraising goals, the abilities of your team, and your project’s features. We at Priority Token had plenty of experience with a broad range of projects, and the timing was also very different. However, there are some shortcuts and techniques that can help you reach your fundraising goals sooner. Use them wisely, and don’t operate on your own. Seek professional assistance instead, and partner with marketing & consulting agencies that can make a valuable input.