The crypto market is gaining huge popularity. Every month dozens of projects are registered, thousands of users wish to take part in them. ICOs are held for this purpose. Thanks to it, developers receive the necessary funding, and investors become participants in the startup they believe in.
ICO is the initial coin offering. According to statistics, during 2015-2016 the volume of investments in cryptocurrency projects increased by 1300%. The next two years showed even more impressive growth – 6600%. No financial industry has been able to approach such dynamics before.
ICO is so successful for a number of reasons:
- Easy to raise capital
- You can invest with just a few dollars
- High speed of transactions
- The possibility of obtaining super-profits
ICO benefits for startups
Initiators of start-up projects often need funding for their activities. To do this, they issue tokens that investors can buy for fiat or cryptocurrencies.
ICO is carried out at the initial stages of the project development or when additional funds are needed. Usually, after the formation of a full-fledged infrastructure, there is no urgent need for financing. Aspiring entrepreneurs use the offering of the tokens for a quick search of investors.
ICO benefits for investors
Placing tokens on the market attracts many individuals and organizations. It has many advantages:
- The ability to make small investments. Almost everyone can buy a token.
- Great opportunities for earnings. Often, the amount of token sale is many times higher than the purchase price. Sometimes the profit exceeds 1000%.
How to choose the right ICO
Before buying tokens it is better to take the following steps:
- Learn ins and outs of the project. To do this, you should study the business plan, get acquainted with the objectives of the platform, evaluate its benefits, and much more. It is better not to invest in projects in which there are blurred wording and terms. The ICO plan should be clear and understandable.
- Goal analysis. Examine each stage of financing and the timing of its implementation. The aim of the project should be realistic and clearly formulated.
- Meet the team. The project should be implemented by experienced and well-known developers in the crypto-currency industry. They should have a successful background in blockchain projects. Try to learn about the achievements of the development team members.
Read also: 5 Tips on how to avoid ICO scams
Each side of cooperation benefits from investing in ICO. Of course, investors should carefully choose a project, because according to statistics, about 80% of the platforms are unprofitable or fraudulent. On the other hand, you need to follow risk management and not invest all your money in one company. On our portal, you can find a lot of information about ICO and cryptocurrencies. Study it, it will help you to understand the topic well and avoid many problems.
All the peculiarities of Pre-ICO
Every great idea needs funding and resources to come to life. Some startups somehow have to do it without investors’ help, at the same time not having many own funds. Pre-ICO is the tool with its name written all over it. Let us consider in detail what it is.
What is pre-ICO and why buy tokens on it
In fact, pre-ICO is held to raise money to prepare for a full-fledged ICO. The process is somewhat similar to presale. For example, it was used by the feedback system on blockchain Revain. It took only a few days to collect more than 854 thousand dollars.
Pre-ICO is more than just a coin offering, it is a pre-launch, that can help you get invaluable statics on market reaction, etc. The pre-ICO startup gets valuable experience that can be used in the future.
The proper choice and some luck may bring about x10 investments to you! During the presale, tokens are purchased by people who believe in the success of the project. Their main motivation is the possibility of obtaining large profits in the future. Of course, you need to remember the risks of losing everything.
Read also: Top ICO projects that failed miserably
On the other hand, if you choose 10 pre-ICO projects and participate in them in equal parts, then even with the success of two of them, it will be possible to double the investments made. There are different investment strategies.
What expenses do the companies expect at pre-ICO?
To organize the pre-sale implementation of tokens, much work needs to be done. At this stage, the following expenses are coming:
- Website development. Usually, a simple web resource built with a constructor is enough. Creating a high-tech website will cost several thousand dollars.
- Create a video presentation. A short video will be a great solution for introducing the public to the startup. Usually, its cost is in the range from 1 to 100 thousand dollars.
- Advertising and PR. A good option is to tell about yourself on thematic forums. The most professional approach is to turn to specialists. Their services can cost up to 7 thousand dollars. However, in practice, usually 1 thousand dollars is enough.
- Development of project presentation. Initiators usually come up with the concept of the project. Experts will be able to present it correctly. The costs will be up to $ 500. But you may also use your own efforts for that.
- Writing WhitePaper. “White paper” should describe the project in detail business plan, Manifesto, market analysis, ideology, ideas, functions, etc. The whitepaper is necessary primarily for the owner, it allows him to structurize the data about his startup. Implementation of the stage may entail costs up to 5 thousand dollars.
- Targeted advertising. That can be Facebook or Google platform. The only limitation of the budget is the financial capacity of the project owner.
Pre-ICO opens wide opportunities for project owners. It allows you to get much-needed funds for the development of a startup. Also, developers will gain experience with investors. Our crypto portal has prepared a number of articles for the organization of token sales. Get to know them to get it right from the start.