Initial Coin Offering (ICO) sounds familiar but not sure what it does in the cryptocurrency and blockchain industry? Well, Initial Coin Offering (ICO) is a way to raise funds by offering digital assets called “tokens”. When a startup wants to raise capital, they launch the ICO in the market to raise funds and create direct connections with companies and investors. Initially, it works really well for any startup to give a kick-start to their business. ICO is similar to IPO – Initial Public Offering. A startup company offers tokens to the companies and investors, instead of shares.
Okay, let us make it more simple for you. You are a startup with a great idea to launch a cryptocurrency system. Also, planning to streamline the payment system with a go-to application that is highly encrypted and transparent. You have your “digital coin”. But you need funds to actually make the “digital coin” ready. You might try to raise capital by getting a venture capitalist investor into the play. But, for this, you might need to share your ownership with the investor. So here, without having to give up any ownership, you can launch ICO – Initial Coin Offering.
Before you launch the ICO, you will need to have a deep knowledge of technology, finance, and the law. ICOs basically leverage decentralized blockchain technology to reach potential investors and raise capital by offering tokens to them.
Well, investors, enthusiasts, and supporters buy some of your project’s tokens with Fiat or digital currency. These tokens are similar to the shares of a company sold during an IPO. If enough funds are raised with the ICO, the startup can continue to pursue the project goals. If not, the ICO would be considered unsuccessful and maybe the money has to be returned to the investors and the supporters, etc.
Tokens play an important role in the ICO. They bridge the financial gap of your business. The tokens should be interchangeable and tradable. Unlike stocks, tokens do not offer any equity stakes in the company. The token could benefit the investors in the form of a service, product, or with an ultimate raised value in the future.
The ICO Campaign
Well, you are already on the ICO launch. So you need a detailed whitepaper necessarily covering and explaining the details about your startup. Let’s say,
- What is the project about?
- The purpose of the project and the aims & objectives of it.
- How many funds do you need to raise to accomplish the goal?
- What does your ICO offer in terms of value?
- What type of currency is accepted?
So, your ICO whitepaper should be as precise as it could be. It should be able to answer most of the questions pertaining to your ICO. Dozens of firms have successfully established by exploring the ICO space with the best ICO practices. So make sure that the whitepaper is engaging, detailed, and covering the entire information about your project. To summarize, your whitepaper is the key to success, to stand out in the market.
The ICO Marketing
In the word of cryptocurrency, numerous firms were able to do great crowdfunding by launching new tokens, coins, and services. Although ICOs are risky, investors closely keep an eye on the ICOs’ launch to make their next move. Investors are always curious to invest in tokens that could create the future value of the service. It’s simple, one great idea can make everyone win.
Now that you have your whitepaper ready, you should find your target market to offer the tokens. You will find targets who are aware of the cryptocurrency and ICOs work and people with zero knowledge about the ICO. You should be able to jot down the potential investors who would be interested in your new venture. If the investors find your venture attractive and interesting, then it’s going to be a great deal for you.
Oh but make sure, your investors meet certain criteria before they buy your tokens. Make sure your investors are familiar with the cryptocurrency market and are ready to buy tokens with pre-existing cryptocurrencies. They have their cryptocurrency wallet capable of holding various tokens or currencies.
Of all the white papers, social media is a boon to market your whitepapers and reach your potential investors. You could get the ICO related questions answered on social media platforms such as Reddit, Twitter, Facebook, Telegram, and plenty others. Engage the audience, and netizens on the crypto-communities, and make them excited for your product or service. Make the most out of these social media hubs. They are the best to perceive the best ICO launches.
Okay, long story short. Now that the world is waiting for your token, plan a prototype to prove your product. Launch your website, exchange your ideas with the world and you’re done! Remember, ICOs are the best way to reach your targets and raise enough capital. Do not get screwed up.
Just launch an ICO that promises the future with high rewards!