The success of Bitcoin had the predictable result of attracting many entrepreneurs with an active interest in launching their own cryptocurrencies. Some of those alternative projects have grown to great proportions, like Ethereum and Litecoin, while many others tend to pop up shortly on the radar and then fade into obscurity.
The people behind these projects eventually realized that a solid initial funding platform is absolutely critical for the whole project to succeed, and have turned to using their own cryptocurrencies as a form of reward for early investors. This is a model similar to the fundraising done by many startups during their launch phase, but it also has some intricate differences that make it more attractive specifically to people launching cryptocurrencies.
In any case, it’s important to know how a good Initial Coin Offering – or ICO – works and what factors could determine its success. Jumping into this venture unprepared is definitely not a wise move nowadays when we have so much information available about the way the cryptocurrency market works.
Try to solve a new problem
Let’s face it, the cryptocurrency market is quite overcrowded right now, and new entries tend to get lost in the whirlwind of noise before they’ve had a chance to make a proper splash. In order to avoid that, make sure that your implementation actually does something useful that no other blockchain technology offers at the moment.
It could be something like Golem offering you access to distributed computing, or a currency with a particularly strong value in certain contexts. It could also be something as simple as using a blockchain currency as a payment token in an upcoming service you’re launching, like a game store platform.
The important thing is that people are automatically incentivized to buy in due to the way the currency itself works, and not because of the prospects for its future value.
Have a professionally written whitepaper
Nothing turns away investors more than a whitepaper that looks like it was hastily put together by someone doing it for the first time. You have to radiate confidence in everything you do, and that includes presenting your idea in an educated manner.
If writing text of this type is not your strong suit, consider hiring someone experienced to cover that base for you. Although, as long as you are working with the right people on the project in the first place, you should already have a pretty good initial draft from just the documentation they have been producing during their work.
Be public and visible
Another aspect that can separate you from the majority of other companies coming up on the market all the time is having a clear public face. It’s not rare nowadays to see a new cryptocurrency pop up with seemingly no information about the people running it. Even worse, this sometimes happens with new wallet systems and other platforms where you would expect that people would care about their privacy and security a bit more.
This has made many people wary of new companies, prompting them to investigate much more deeply when a new player arrives to the market. With that in mind, be prepared for a lot of scrutiny, and if you have anything negative associated with your name that can be easily discovered with a few Google searches, you might want to prepare a good explanation for those who ask. And you can be absolutely sure that there will be a lot of people asking if your project gets even close to successful.
Have a public discussion forum, and be active in it
This is related to the point above, but deserves a separate mention of its own. If you gain enough traction, people are going to want to discuss your project, especially if you’re bringing something more interesting to the table.
For the most part, these discussions are going to evolve on their own in a very organic way. People are going to talk about you on social media, come up with their own hashtags, perhaps even create and moderate a subreddit for you.
But doing these things yourself in preparation of the project’s launch, and actively participating in the communities you’ve created afterwards, can make a huge difference in the way people look at your project. It instills a lot more confidence to see the project runners engaging their community so actively, and people would be much more inclined to take part in those discussions too if they see they have a chance to chat with the people behind the project.
It’s easy to set up a channel in an IM service like Discord, or a whole forum, depending on the scale of the project. This also gives you the benefit that the most important discussions will be happening in an environment you control and observe directly. This can be quite useful for preparing your future marketing messages.
Launch on a smaller scale first
Last but definitely not least, it can have a huge impact if people are given a chance to see how your project works in reality with a fully fleshed out version. It can be scaled down to make the launch easier – and to preserve the value of the tokens you’ll be selling later on, of course – but the important point is that people can actually “feel” what the project is all about, and decide for themselves if they see a merit in it.
You can also throw in some additional hooks for the ICO in that test version, although if you do things right, that won’t even be necessary. The people coming in to see what the big deal is will likely already be considering an investment.
A successful ICO can make all the difference between a hugely successful project in the cryptocurrency world, and a disappointing failure. There are many factors that go into determining how well your own ICO is going to be received, but whatever you do, just don’t fall for the trap of thinking that it’s all down to luck – there is actually a lot you can do yourself to improve your chances.