ICOs or Initial Coin Offerings have been the latest trend recently. A lot of new companies started popping out of the woodwork and they used ICO to crowdfund their project. And why not? It is, after all, one of the best ways to attract a lot of investors in the quickest possible way.
Now, if you or someone have an idea or want to start up a business or a project and you do not have enough funds to start it, starting an ICO is the best way to gain potential investors. But before you go ahead and do that, let me tell you now that there is a right way of doing it and a wrong way.
The right way will land you a lot of investors and will surely spark your capital in the fastest way. The wrong way, well let’s say you are going to kill your business before it even started. Here are the common misconceptions and pitfalls when starting up a token crowdsale, how to avoid it and generally the things you are going to need when starting your own ICO.
This is the first thing that should come to your mind if you are interested in starting a business and using ICO as a way to garner investors. Think of something that is unique and will offer a service to potential investors and the end users in the long run. Make sure this idea, however, is solid as anything that has flaws in it or is a copy of an existing product would definitely not attract investors to invest in your company.
Having a very stable team behind your company will give you plus points if you are thinking of launching an ICO. People want to see stability in a company before they would invest their hard earned money in it. Hiring experts in their respective fields with very good references will surely garner a lot of attention, hype, and buzz in social media circles, which in turn can lead to having people think of investing in your company.
Think of it as a Justice League or The Avengers. Each team member will have their own strengths and weaknesses and hiring a lot of them with different strengths will surely compliment on the structure you will be building on, just like Batman with his intelligence and Superman with his raw strength. Remember, a house is only as strong as the pillars who support it.
This should be one of the core tenets of your company and should live by it. Be honest with dealing with people. Everything in a company no matter how small or big it is always started out with trial and error. This will weed out all the imperfections and will always guarantee to give you a working prototype or product to release or to show and tell your investors. It is not always sunny every single day, so failures should be treated not as a roadblock, but as a lesson where you should learn something from.
This should also extend to documents such as your white paper. Be transparent when writing your white paper because it will be read by the very same people who will give you money to start up your business. You should impress them, but also be honest with them as they are the main reason why your business exists in the first place.
Being transparent with your investors will also deter FUD that will be generated by when you launch your ICO. This is because you are transparent with your investors and they will get to hear information straight from the company itself.
Now that you have reeled potential investors in by your white paper, the next thing you should do is show a roadmap for the company’s future. People will want to see how you are going to use their money for development. The roadmap is the best place to do this. Set an ample amount of time for hitting each of the checkpoints in your roadmap and be realistic about your goals.
Having an excellent white paper and roadmap goes hand in hand. If you manage to do this correctly, people will surely start breaking their piggy banks and invest in your company.
Now, this is where it gets exciting. To be able to have a successful ICO, you should reach a lot of people. You should be able to do this by marketing it non stop. There are a lot of methods and places to market it. A big example is Bitcointalk, most of the successful ICOs have launched marketing campaigns in Bitcointalk such as signature campaigns and bounty campaigns in various social media outlets. Just make sure you hire professionals who will be able to handle your campaigns, as handling this yourself without any experience might be detrimental to your marketing campaign.
Aside from that, renting advertising space such as billboards will also garner attention from the general public in your location. Take Electroneum for example, they rented different locations in the London area. This resulted in closing their ICO early because they have reached their market cap in the third week. This also shows the legitimacy of a particular company since you will be renting advertising space and it requires documents to be signed which is required by the city you are advertising in.
This is one of the most important things you must remember before launching an ICO. People will never invest in a business that is not legitimate. Being a registered business before launching an ICO is an integral part of the growth of your company. People will shy away from an unregistered business.
Hiring people with bad backgrounds will also put a taint on the image you are trying to build. This is one of the things that you need to avoid as well as instead of reeling people who would spend money on your project, hiring these unsavory people will push them away.
Also, once you have established your legitimacy, do not do anything that will ruin your reputation. Keeping it intact will surely make your ICO successful, and also your project in the long run.