Crypto Frontline

What Makes a Successful ICO?

What Makes a Successful ICO?

What Makes a Successful ICO?
May 17
06:39 2018

 

We must begin by saying that there is no Holy Grail for spotting successful businesses and we are unable to anticipate the future. That is true for successful ICOs, but what we can do is to spot some particularities of successful ICOs and search for them in other future projects. Although each project is unique, we believe that if you will try to find companies that have the characteristics we will describe in the following sentences, you could see yourself as part of a successful business.

Sign #1 Revolutionary business

The business behind the ICO is what matters the most. Sure, it is important to have good technical characteristics. The structure of the blockchain, the mining algorithm, supply, and different technologies that should be implemented are all important. But all of these will not worth a dime if the business behind the ICO is not unique.

How can the business be unique?

You can find the answer to this question by analyzing the following aspects:

– What kind of problem is the company behind the ICO solving? It should offer products/services that satisfy certain needs and also, the company should come with products/services better than the ones that are currently in circulation. Innovation is one of the main characteristics of highly-successful businesses and you definitely need to watch for this thing.

– How can the company monetize efficiently its activity? Even though there are some successful companies in the world that address some of the issues humans are facing, they lack profitability. Among them are Netflix and IBM, the lather currently borrowing money in order to pay dividends. A successful ICO should have a clear plan for generating revenue and you should monitor those aspects on a constant basis.

Sign #2 Efficient marketing strategy

There’s no use to have a unique business model if people don’t know about it. We are talking about Initial Coin Offerings here and the company behind the ICO aims to raise funds by selling tokens to public or private investors. A good marketing strategy is required in order to get to a high number of people willing to invest in the company.

Let’s take an actual example and see what marketing managed to do. Telegram is currently the biggest ICO in history, raising around $1.7 billion just from private investors. The company had not conducted any public sale and it is considering not doing it since the capital raised exceeded any expectation. Telegram is an ICO with a highly-ambitious project and judging by the information from their white paper, we are talking about a unique business.

However, what was the budget allocated for marketing?

The total amount is estimated to be around $500,000, a huge sum for most of your reading this material. And it is not just about the money, but also about how it had been spent.

Sign #3 The team working at the company

Behind any successful company, you will find a team of smart and ambitious people, eager to accomplish a lot of wonderful things. Only a team of experts is able to obtain a high level of success and that is true for ICOs, as well. Make sure to analyze the team behind the ICO, before you can decide whether it could be successful or not. You must face the fact that no matter how unique the business is, how good the marketing had been, the company will face problems along the way. The people behind it need to have the ability to solve those problems and come up with some innovative ideas.

Sign #4 Timing

Probably one of the finest details of all is related to timing. What do we mean by timing? You may ask. Well, timing is basically the most in time when the company starts its activity. It should be a time when the sector it is activating is booming. We are currently seeing the ICO market booming, as the ICO statistics show. Because of that, startups that want to raise capital can do that with ease. We would also like to add that the timing of the business itself is highly important. You must be able to spot if the company’s activity comes at the “sweet spot”, meaning right when people need those products/services.

There are many successful companies that failed, just because of timing. Let’s take an actual example with that respect, so you can understand better. There had been companies just like YouTube, which wanted to develop a business related to video streaming. However, the timing was not appropriate, because the internet was very slow. After the start of the 21st century, we’ve moved from the dial-up connection to broadband and thus video streaming companies could thrive. The main reason behind the success of YouTube is the perfect timing, as they entered the market just when the internet speed got better.

These are the four most important aspects which make an ICO successful. Now, what you need to do is learn how to spot them.