The world is now crazed with ICOs. The tech is the new trend – all the money is on the tech industry. The youth is getting rebellious against the corporate offices and trying to build their dream possible. Everyone is working so hard to make their voice heard. But they are facing the inevitable problem fulfilling their dream – money!
Even a person having solid plans and possible ideas to execute it – getting enough investment is a hard nut to crack open. The traditional approach was to beg to the venture capitals and ask them for money so they could build their dream.
But getting investments from these venture capitals has some serious problems – there will not be a regular flow of money unless the VC is satisfied with the growth. Moreover, they will be acting like bosses and try to dictate your dreams and plans. But isn’t that’s the reason youth quit their day jobs and decided to fulfill their dreams?
A perfect solution to this very problem could be “Initial Coin Offering” a.k.a. ICO. So, what are there ICOs that world is so crazy about?
- 1 What are the ICOs? Explained with Example
What are the ICOs? Explained with Example
ICO is an idea to get crowdfunding for your project. Let’s consider an example, and you will get the idea in a better sense.
Let’s consider; you have a plan to solve a severe problem our society faces today. We could think about the lack of jobs. So, you are planning to build an online platform where everyone could find the job that matches their skill sets. You will collaborate with all the employees and the employers and make a perfect little platform to build your dream come true.
But to build such a platform, you will need developers, coders, and business experts. Meaning, you will need money to pay your team. So, what you do? You make a beautiful PowerPoint presentation and knock door to door for investments. But getting investors are not just sitting there for you to come. Even if you find the perfect investor, it will be tough to convince them to invest in your idea.
The investors are just businessmen. They will not hand over all the money that you need to run the project. Investors especially the VCs will give you the cash on installments. Also, they will monitor your every single move and could stop the flow of money at any given time as they please.
With the cryptocurrencies and blockchain technologies, you could try out another way. You could ask an ordinary people to fund your project. The method is better known as crowdfunding. But you cannot just walk around your home requesting every guy you see and showcase them your idea, right?
You could instead create a website where you will be showing your ideas, your project timelines, the possibilities your project bring forward, and of course your technological details. Meaning, you will tell the world how exactly you are planning to build and run your project. You will sell them tokens that can be used exclusively later on. For these tokens, you will receive money. Well, this is going to be the money you are going to spend to fuel your dream project!
But how much money could this process make you? We are not talking about hundreds or thousands of dollars only. You could collect millions from raising money by ICO.
Yes, we are not just bragging about it! Only in 2017, the start-ups raised over $5 Billion. This year, within just six months, we have seen companies raising over Billions – the growth is now more rapid than ever.
Not every ICO takes a large team. The Useless Ethereum Token raised over $200,000, and the project was run by a single person only! So, if you have a solid business plan, building the initial fund with ICO could be the smartest decision you would ever make.
Moreover, your business plan doesn’t have to be related to the tech industry. You could be starting an agro farm and collect money from an ICO. For example, you could think of the BananaCoin. These guys planned to make an organic banana farm. They have raised their investment through an ICO. After their massive success of building a banana farm and selling fresh bananas, they are now expanding their business with a mango farm too.
Sounds quite lucrative, isn’t it? So, it’s time to ask the fundamental question – how to start and execute an ICO? Well mates, we here to answer that particular question. Buckle up and be on your reading mode – this is going to be a long read as we will be talking about everything you need to know about launching an ICO all by yourself.
To deal with all the heavy works, we have divided all the tasks into three major phases –
- The pre-public engagement phase,
- The action phase, and
- The post-public engagement phase.
The pre-public engagement phase includes all the tasks you will need to take care before launching your idea for the ordinary people. This is a hefty phase, and a lot of ICOs fail because they took this phase too lightly. It could take about six months or even a year or more in some cases.
Then comes the action phase or you could simply tell it the ICO phase. During this time you will be selling coins to the common. You could think of it as a company going public and selling shares. It could be two to three months depending how much money you are planning to make for your business to launch.
In the final phase, you will be serving your project and lead it to success. Nothing should be on your mind except making the business a sheer success. You will handle a lot of members from the various department of your team. Your team will include but not limit to the developers, the blockchain specialists, public representatives (PR), the marketing team, your legal team, your partners, and the early investors.
Managing your team will not be an easy task. It will feel like being under a lot of pressure. Well, you will be under a lot of pressure. But that is what it takes to make a change in the society and being successful with your dreams and goals, isn’t it?
So, let’s start with our big list to execute and ICO, shall we?
The Big Idea!
Before you are starting anything, you need to brainstorm, a lot. You need to find a stable and practical idea to work on. We don’t want to give you any vague lead. So, grab yourself a pen and paper. Try to make a list of things that you would be interested in working on. You should study the market as well to get knowledge and find out the competition in your preferable niche.
CoinMarketCap has informed us that there are about 1,500 cryptocurrencies available on the market. That means your plan will have to be better, different, and feasible. Otherwise, why should people be investing in your idea at all?
Try to ask yourself these questions – what kind of problem will your idea try to solve, who are your target market, how your idea is better than the rest? You should list out all the problems the world faces and constantly think of the solution to these problems.
This is the best way to come up with the business ideas. Actually, all the businesses try to solve a particular problem. So, think about how big a problem you are planning to solve and how you could solve it.
Remember, you need to be practical and think of the feasible solutions only. You cannot think of creating a genie who will solve all the problems of the world!
After you are selected a particular idea, try to seek public opinions from online forums. Reddit is a great option for seeking ideas and checking public reviews. You could even try creating a thread on BitcoinTalk forums.
Moreover, also ask yourself if your business idea needs tokenization. Not every idea is suitable for ICO, and not every idea will get support from the ICO. So, choose your niche and idea properly. Don’t rush; nobody has given any time limit. Although if you are just wondering about it without following any straight method, you might end up nowhere. Remember, you are here to do business, not to become a messiah!
Know Your Competition and Your Competitors
Market research is a crucial step for any business. Starting a business without proper market research is like walking in the dark hoping you will find light someday. You might have got a brilliant idea, but if some else is working on it or already has built it, your plan will more likely fail. Unless you have something unique to provide the market.
Also, think about the timeline, if someone else has the same idea as yours, you could take the lead by launching the business earlier than them. But don’t try to serve half cooked dishes! You need to finalize project as perfect as it gets. A business full of flaws will only do damage to you. So, make up your mind, do market research, know your competitors, and go public only after your plan is bulletproof.
Otherwise, your ICO will fail miserably. Statistics have shown that about 46% ICOs fail due to various reasons. The statistics are based on the year 2017 only. But still, you don’t want to be another example of the failure!
Does your Government Support You?
We all know blockchains and cryptocurrencies are all about making things decentralized and distributed. It has become a headache for a lot of governments. They simply don’t want people to be in charge of things. The more dominated the common people are, the easier it is to rule them!
Moreover, scams related to ICO is not a rare case. We have seen and heard of ICOs robbing public money or being scammers. The government has no choice but to regulate the ICOs now. For example, in the US, the Internal Revenue Service or the IRS is monitoring all the activities of the ICOs so that they have a clear knowledge of their wealth and activities.
In China and South Korea, ICO is banned altogether. We are very sad to see such countries with advanced technology banning the future of technology. The Security and Exchange Commission (SEC) has exempted their citizens from buying certain tokens. The red-listed cryptocurrencies are Gooldmint, Monaco Visa, Datum, and many more.
So, if you are planning to launch and ICO, you better have a good lawyer. Also, you should check your government’s policies regarding cryptocurrencies and ICOs. You don’t want to be in jail by launching an ICO. Moreover, all your money could be seized by the government, and you could face a long time prison visit for such acts!
Just try not be or look like a scam in any way. Show your idea to the public and leave nothing hidden. Be as transparent as you can be while writing the white paper and all the documents. Moreover, be honest, don’t plan to raise a lot of money and then run away with it!
Design and Develop the ICO Token
You are going to sell the tokens during the ICO. So, it goes without saying that you will need to develop a coin or a token in the very first place. But first, you will need a proper distribution plan. A token sale could be of various forms, or you could call them stages of the token sale. You could go for a private sale where you will be selling the tokens to the selective individuals. Then comes the pre-sale where you will try to sell the tokens without giving detailed information. You can go for the actual ICO or the general sale. The choice is entirely up to you and you only.
For example, you could take a look at the NXT’s strategy which is on the number one spot regarding ROI. They managed to collect about $16,800 as donations from the forums. They started their ICO back in 2013.
Telegram another popular name collected over a staggering $850 Million with their private and pre-sales. They haven’t started their actual ICO, yet they are planning to go for another private sale. This time they are planning to double the amount they earned previously. So, you see, you have your options open. You could go for any method that suits your need and your strategy.
Next, you need to make a fine distribution method. You need to finalize how many tokens you are going to launch in the market for the ICO, how your buyer will receive the tokens, how many stages you are planning your ICO to have.
But the most important decision you need to make is regarding the development platform. You could choose to build up the tokens based on the Ethereum’s platform. About 81% of the tokens are based on the ERC-20 token developed by the Ethereum team. Ethereum has published all the codes. So, you will need to copy it and tweak it a bit to make your own token.
Well, you could still go for other platforms. There Waves and Hyperledger who offer excellent token platforms. You might even go for building your very own custom blockchain platform. This could be a time-consuming idea. But if you have a tech-savvy team, the option is not that bad. It’s a great one if you can make it.
Whichever method you choose, the bottom line is to create a token that you are going to offer to the public.
Take up Your Pen and Paper
After the token, you will need to write about your idea and your tech. You will have to write a detailed and clear analogy of your project. This paper will be called the “White-Paper.” A white paper is everything people should know about your project. Try to be as thorough as possible. Your customers will want to know everything including project plans, market analysis, your planned timeframe, your methodology, tech architecture, your legal plans, your team, and you. In short, you are expected to write EVERYTHING!
Not every one of the investors will read through the white paper. But it creates your image to the world. The tech savvies will definitely read it and try to analyze the impact you are going to make on the market. Even the review writers will read every single word. So, they might criticize you if you have a poorly written white-paper. It will hurt your image badly and sabotage the hunt for getting investors.
Moreover, the blockchain geeks have a fairly great knowledge about the technological facts. They might criticize you badly if you have a mediocre level white paper.
The Perfect Little Website
A website is the most import factor getting more investments. The investors see your website as your potential. Your website should be simple yet detailed with all the necessary information. You need to add details of the team. People would want to know whom they are investing on. Your team members should have a photo, the name and their designation in the company. It will look more professional and reliable. They don’t want to give money to some John Doe.
Next thing you need to add is the project’s aim. If people don’t know what you and your team is planning to do, they will lose interest. Be focused on clearing your idea in some short yet focused words. For example, if you plan to make a new kind of job market, you should focus on “New Job Market.” People can grasp the idea just by seeing these three words.
Moreover, it makes a good first impression. You need to attract their attention just at first glance. Don’t try to be descriptive or vivid here.
The final detail you should have on your website is your tech. Be very detailed about how you are going to solve a particular problem. Designing infographics or a short video is a great idea to go with. This showcasing will make the idea more reliable to the investors. They would think themselves a part of the team – not an outsider.
Apart from these, you could try adding a roadmap. A roadmap shows the time-lines of the important milestones you want to touch. People want to see when they could reap the money and have the fruits. They better ROI you promise them, the more they will be interested in your project. Try to find out all the important milestones and plan a time-line you want to meet. Now share this idea with the world. The world will see it as your determination and how much focused you are about your project.
Link up your social media platforms. Most of the people these days have multiple social media platforms which they use on a regular basis. The social media platforms could be a great way to connect with your potential investors. We are not just talking about Facebook pages and Twitter accounts, try using the platforms where your potential investors might. We are talking about Reddit, Bitcoin Talk, GitHub, Medium, YouTube, or LinkedIn.
As you have finalized your contents, you need to work on your website layout. Try to keep things simple and elegant. No one wants to see a pile of words stashed here and there. Be organized. Using a single page website a great option as things are easily accessible and convenient. Although you could go for other options as per your demand. Try to choose the Sans the Sans Serif fonts as they are clean and clutter-less.
Security should always be your primary concern. We have seen a lot of great ICOs fail due to lack of security. We have to let you know about The Dao when we are discussing the security issue. The Dao project was one of the most promising ideas we have seen so far. It planned to develop autonomous organizations where there were no bosses – a self-sustaining organization. The ICO even raised over $150 Million. But due to a cyber-attack, it lost over $500,000. Soon people lost faith over The Dao. Now, The Dao is just an example of ICO related security issues. You don’t want to end up like The Dao.
To summarize, your website should contain these following things –
- Your logo
- A simple infographic or an introduction video or both
- A roadmap
- Detailed illustration of your tech
- The team members’ description
- The impact of your project on the society
- Use cases of your project
- Legal documentation (terms and conditions)
- About us page
- Social media accounts’ links
Marketing: Get Your Voice Heard!
It’s the era of marketing. You need to spread your voice to the public, more specifically, to your investors. You cannot and should not hope for investments if you don’t have a solid marketing strategy. You have everything you need to launch an ICO. But, if people don’t even know that you are launching an ICO, then what’s the point of doing it anyway?
There are certain ways you could set up your marketing strategy. The easiest way to look for a good marketing manager. The manager will charge quite the amount but consider it as an investment. But if you are running short on budget, you could try to be your own marketing manager.
The first thing to do would be bolstering up your social media accounts. There are lots of great freelance social media experts who could boost up your social presence and help you gather the organic traffic, not just some paid likes. Remember, paid likes and followers will get you nowhere. Try to seek you’re your actual target audience and create contents for them. There is no easy way to reach out your voice to the common people.
The next thing you should do is to create a blog section. We still lack some helpful blogs in the blockchain and cryptocurrency niche. More and more people are getting attracted to the blockchain and cryptocurrency niche. Before others build up a strong blog community, you should seize the chance to help the community with some great blogs. Blogs are the best source for collecting organic traffic. People will visit your website to quench their thirst for knowledge. Try to be true to your readers and actually help them with honest information. They will give back the courtesy someday.
Adding up a great FAQ section also a smart idea. People are questioning a lot about various simple yet common questions these days. You will be surprised to know how many people are seeking the perfect definition of ICOs! As the hype of blockchain is increasing people are falling victim of fear of missing out. Very soon the internet will be full of people who don’t know what a blockchain or an ICO is but will be willing to invest as they think of it as a great way of winning cheap money!
Try to be regular on the social media accounts. If you are planning to dump 15-20 posts once and then be invisible from these accounts, you cannot grow your community. Instead, you should post regularly with a lower number of posts. Try posting 5-10 posts throughout the week rather than dumping all of them at the same time.
Being available on the forums is a great move as most of the blockchain enthusiasts are on these forums not on Facebook. Try to show your presence on Blockchain topic based forums like the Bitcoin Talk, Altcointalks, BitcoinGarden, and many more. Reddit and Quora are two great options where people are docking to get information about blockchains and cryptocurrencies.
Slack and Telegram are the blockchain based messengers where you will find blockchain-educated users. They are the potential investors whom you should target.
While, doing the social media marketing, keep in mind that Facebook has banned all kinds of ICO related ads. So, you cannot increase your popularity in this platform just by placing ads. You have to be popular using the dedicated groups and pages to get your deep sought investors.
Remember, you can never make the common people think that you are a scammer. We have seen ICOs with a lower number of followers going silent, and the people suddenly started screaming their name as scammers. Always serve your followers, they are your asset and always will be.
Launch the ICO
Well, you have done all the works you needed to do before you are about to launch an ICO. But there is a crucial question – for how long do you intend to continue the ICO? Well, it depends. If you are getting huge support and regular token sales, you could continue your ICO. But if you see your token sale rate dropping down gradually, you should consider stopping the ICO.
If we think about the statistics, an average ICO continues for about 41 days. Although it is just a number. You can continue our ICO for as many days you want it to continue. Then again, if you see your investor number dropping down in rapid speed, you should stop the ICO. Here is a list of some of the famous ICOs and their duration –
|Coin Name||Duration||Collected Investment|
|Omni Coin (MasterCoin)||30 days||$750,000|
So, you could see there is no solid time frame. It depends on how much and how fast you are earning money. Communication is the key to success during and after the ICO period. Moreover, people will have tons of things to ask about the coin, your services, and your product. It is quite the normal and common scenario. If you fail to maintain proper communication, your brand image will get serious damage.
Apart from maintaining a bulletproof communication, you should also impose a strong security measure. Your ICO will be extremely vulnerable during this period. You must be prepared for kinds of security breaches and attacks. You could lose millions to the hackers.
After the ICO
Once your ICO has ended, your primary concern should be focusing on your dream project only. You have worked so hard for making your dream, your passion to be true. Now you have the chance to fulfill your dreams as you have the economic backup to do so. Moreover, you investor will seek to witness improvements and some results. You should do all you can do to for your customers and the token investors.
Well, to speak the truth, starting and launching the ICO are the easier tasks compared to what you are going to do after the ICO. You could think of it like – just getting the money to make something you dream of. At this point, you have a moral, financial obligation to work on your project and deliver something of value to the world.
Well, you have collected some money for the investment, you have some cash on your wallet, and your team will get the salary that they deserve. But you need to focus on one thing here – making money for everybody else! How could you do so? Actually, sell to the mass people and earn money for everyone. Launching an ICO makes you more of an entrepreneur as you are collecting money from the common people not just begging to the corporate investors. It will make you more independent and help you get more control.
So, your next step should be getting listed on cryptocurrency exchanges. A cryptocurrency exchange works like a typical stock exchange. This is the best way to speak out to the world and make your presence noticed. Each of these exchanges has certain requirements that your project needs to fulfill.
Don’t worry as long as you haven’t stolen anyone’s idea and is completely unique; you have nothing to worry about. Among these cryptocurrency exchanges, Poloniex is the most well-known and the largest exchanges. So, do you have to do to get yourself enlisted on Poloniex? Well, there is no particular method you could follow. They claim to pick the most unique, innovative and popular projects that meet their users’ demands. Another important criteria for getting enlisted on their platform is by creating strong market demand. The more market demand your brand has, the easier it is to get enlisted. Apart from Poloniex, you could try getting enlisted on Binance, Bitfinex, Bittrex, HitBTC, GDAX, bitFlyer, Kraken, Bitstamp, etc.
To get enlisted on the exchanges, you should have the following attributes –
- Coin name – Well having a name is the most certain things to come in mind. So, you got to have a name for your coin!
- Trading Symbol – A coin trading symbol is a three-letter name that can represent you coin name. For example, Ethereum is ETH, Bitcoin is BTC, Ripple is XRP, etc.
- The Project and The Token Description – Your project should have a clear and short description that can truly stand for the mission and vision your project has. Apart from the Project, your token should also have a clear and concise mission and vision. You need to submit these pieces of information to the cryptocurrency exchange.
- Coin Logo – Coin logo is the most simple and clear symbol of your brand. A logo can give your brand name a better status and makes it more trustworthy among the users and the investors.
- Launch Date – You should tell the exchange the initial date of your project to run so that they can age your project.
- GitHub Link – Exchanges will ask for source codes before listing you coin to their directory. It’s okay. You don’t have to worry about them stealing your idea and copyright.
- Compliance Fee – Some cryptocurrency exchanges might ask for the entry fee which often referred to as the compliance fee. For example, Bittrex used to charge $5,000 as the entry fee. They have revoked that law later on.
- Third-Party Certification of the Source Code – Your project’s source code should be verified by a trusted third party. Some of the exchanges are very strict about this certification.
So, these are everything you need to know about the cryptocurrency exchanges. Without these pieces of information they might not register your brand’s name on the exchange’s registry. It is vitally important to get your name registered otherwise people might think of as a scam or a fraud.
The world is changing so should be the way of doing business and collecting the initial investment for your business. Launching an ICO makes you more independent and gives you the freedom to steer your project to the ultimate goal that only you can envision. Sure, there are lots of cases of ICOs to fail. But at the same time, we could give lots of names of the successful ones too.
It goes without saying that ICOs are the new fuel for the business especially the start-ups. The amount of investment through ICO has reached the sky. Billions of dollars are spent on the initial investments of the start-ups. This more likely shows the world that cryptocurrencies are just some imaginary words uttered by some tech geeks. It is very much the reality. It also works like an indicator that the world as we know is going to change. Actually, the change has already begun. Now it’s time to see how far will cryptocurrencies go and impact the everyday life of every single human being on the planet. Moreover, we want to look at how cryptocurrencies will impose decentralization and distributed network that crumbles the controlling hands of the banks and the financial institutes.
So, if you have a dream in your heart and chase it by setting up your own business, ICO might save the day from the mean investors. What are you waiting for? Start working on your dream today, work on the next big idea that will change the world entirely, ICO will give you the wings to fly.
Come on champ! The future is calling your name!