Last year’s massive boom in ICOs, with 234 projects raising around USD 3.7 billion, provided a tremendous opportunity for blockchain start-ups to quickly raise money. Since then, the ICO landscape has been hit with numerous scams, mistrust among users, regulatory obstacles, and high volatility.
As 2018 draws to a close, the huge challenge for players in the blockchain and crypto sphere in 2019 will be to reach out and renew their faith on ICOs. To get there, Depeche Mode’s hit song “Personal Jesus” can serve as an inspiration as it stresses the need for people to believe in something and to be heard. Start-ups need to raise above the noise currently surrounding ICO projects and get the attention of potential investors.
Your own Personal Jesus
For many start-ups, the only way to get a project off the ground is by raising funds from individuals or organizations. Reaching out to investors in a traditional matter is already an arduous task. ICOs provide start-ups with an opportunity to access capital and get in touch with potential investors. It also offers ordinary people who want to support a project (followers) to get a piece of the pie. Through their support and enthusiasm, these individuals become a kind of “Personal Jesus” for start-ups. Going through an ICO allows start-ups to define the market reach of their ideas, as well as create noise around their product/service even if this is the developing stage.
Someone to hear your Prayers
Although rapidly expanding, the blockchain and crypto sector remains a niche market. As ICOs are not yet a mainstream topic, any communication around them should be done on a targeted manner so that a “good soul” can answer their “prayers.” Time and again, the biggest failure the majority of start-ups going the ICO route face is trying to address a single message to everyone without differentiating themselves from the competition. Profiling potential investors should therefore be an indispensable part of any ICOs marketing strategy.
The majority of potential investors in the crypto space possess a good knowledge of blockchain and cryptocurrencies. They do research and build their own opinion though what they hear on the media or through their network. Either they believe in the market or they don’t. If they do, these individuals start investing in the leading cryptocurrencies such as Bitcoin or Ethereum. According to an article in BitCoinExchangeGuide.com, these individuals see cryptocurrencies as a long-term investment — rather than quick way to make profit — and are willing to hold their positions to secure a long-term gain.
Someone who cares
Before spreading their vision to the world, start-ups need to know who really cares about their idea. Categorizing investor types is a crucial task to reach them on the right channels and avoid potential losses. In the blockchain and crypto scene, investors can roughly be broken down into two categories: cryptofunds and private investors.
Cryptofunds are hedge funds managed by teams of expert investors and token analysts. Their objective is maximizing returns by adding ICOs to the investment mix while reducing risks. It is important for ICO start-ups to know who these investors are, what drives them and how to reach them.
Private Investors, on the other hand, call themselves “Blockchain Enthusiasts” and are defined by geographical distribution and socio-demographic factors. BitCoinExchangeGuide.com estimates that 40% of them live in North America, 25% in Europe and 21% in Asia. While individuals located in North America typically hold onto their investments, those located in Asia are more interested in paying with crypo. Moreover, 90% of investors are men and have at least a bachelor’s degree. The article also indicates that millennials display a great deal of interest in blockchain technology and bitcoin. More than a third of these Millennial investors are between 25 and 34 years old and a fifth of them are even under 18. The Millennial generation is turning out to be a major investment force behind ICO. They’re really showing they “care” for start-ups.
Lift-up the Receiver
Blockchain Enthusiasts — who are often also private investors — are typically early adopters of the revolutionary technology or even developers. They are fascinated by how cryptocurrencies disrupt the traditional financial system and vie to harness the potential of blockchain to “do good” for humanity.
The relevance of social media as a tool to attract these mostly young investors should not be underestimated as it helps build a community around a project/idea. These individuals “lift up the receiver” and listen to a start-up message and vision. A large community ultimately translates into devoted followers who create a positive and influential impact on investors’ decisions. At the end of the day, it’s all about the way the story is told and positioned.
I’ll make you a Believer
When it comes to attracting institutional investors, communication should not be limited to social media. As the majority of crypto funds are composed of experts — who are highly knowledgeable — a more focused marketing approach is required to convince them about a project.
Start-ups need to frantically shake hands with investors, attend events and conferences, participate in roadshows, and introduce the team behind the idea. Marketing is just not enough. Investors need to believe in the start-up skill-set and consequently in their vision. The objective is to turn every single investor into an own “Personal Jesus.”