ICOs in 2017 were seen as a guaranteed way of raising large sums of money, even if the ideas behind them were sometimes quite weak. In 2018 most ICOs are struggling. Why? What has changed? How can you successfully launch an ICO in 2018?
The market place in 2017 was very different to the market place today. The number of ICOs that have launched, and the number of scams, mean that investors are more cynical. In addition, key engagement platforms such as Facebook, Twitter and MailChimp have banned ICOs, further promoting the idea that ICOs are not credible investments, as well as making it more difficult for ICOs to promote themselves. That makes the market more challenging, but the good ICOs will still succeed.
LookTouchFeel have been very successful in this area, so we receive far more approaches from potential clients than we can possibly support, and we pick and choose our clients carefully with our expert partners. Those ICOs that pass our pre-qualifying reviews all have the following features:
· A strong idea, that is unique or at least shows that it will be implemented better than any competitor products
· A compelling story and a reason why blockchain is being used: blockchain itself can’t be the story
· A comprehensive business plan and whitepaper. Investors in ICOs are now looking for all the same information that traditional investors expect. What is your timeline? How are you going to spend the money? How much have you invested so far? Where has the money come from? Who are the key partners?
· An experienced, credible team. The people involved, as with all businesses, are often the best indicator as to whether a business will succeed or fail. You need to have experts in all the key areas who have the experience needed to make this a reality
· A working prototype that has thousands of engaged early stage users. An idea for a product isn’t enough in 2018, you need to prove the concept before people will invest
· The money to fund the launch. It is an expensive business launching an ICO. Experienced suppliers, like us, know how risky it is, so we charge fees up front.
Our first advice to clients is that, to secure investment, they need to build trust and to do that they need authenticity and transparency running through all their communication from the very beginning. During the pre-launch marketing we aim to increase the visibility of the project and communicate value to increase the chances of people investing and the amount they invest. We normally see three kinds of investors and marketing is built around them:
· Product driven
· Profit-oriented investors
All investors look for evidence that your project can be realised, and future adoption of the network.
It is important to ensure that the messaging is clear. Too many ICOs really struggle to explain what they’re doing and why, because they commonly come from a deeply technical background. We help by building a message framework that includes elevator pitches etc. We then use that framework in all content.
The key ingredient of all successful launches is engagement with the crypto community, so it is our main focus for all launches. It needs to be genuine, real world engagement through global events and targeted, specialist content. As discussed above, many of the usual platforms for content have banned ICOs, so if you use these platforms at all you have to avoid the automated trigger words and talk about the story behind the launch.
The need for credibility and authority in 2018 has increased the need for effective PR to support the digital campaigns that we run. However, most PR agencies are still nervous of getting involved, or don’t have the expertise (even if they do have financial and IT specialists). I suspect that will soon change, as the industry is regulated and things go more mainstream. One agency that is working in this area is Onyx Media and Communications, who have experience working with big and challenger banks and fintech. Their MD, Anne Cantelo, told me:
“PR in this space is very challenging. Journalists have become jaded by the huge number of ICOs and most don’t want to talk to you until you’ve succeeded (even when they’re enthusiastic about your idea). Instead we’ve found that we have to go back to story-telling. What is the story behind the launch, are the people newsworthy, is there something truly unique? It’s a tough sell, even where we have great contacts, but it is possible if we’re involved early enough to ensure that there is a story to tell beyond the ICO.”
I’m looking forward to increased professionalism and regulation to bring a sense of permanency to the industry. Hopefully that will push out the scammers and increase the credibility of the many great investment opportunities that are available. The recently announced plans for the New York Stock Exchange to trade Bitcoin will also give the industry a feeling of permanency.
Succeeding in 2018 is much tougher than in 2017 but perhaps that’s a good thing. Only the best will secure investment and that in itself should improve the credibility of the industry.
The cryptocurrency market is becoming extremely crowded.
You need a grown-up agency partner that understands how to build a community around you.