Crowdfunding burst onto the scene years ago giving startups a way to not only raise money but also build buzz. I wrote that platforms like Kickstarter were the new tech PR press release.
Now another form of crowdfunding is rising to prominence. ICOs (initial coin offering) tap into the excitement surrounding bitcoin and blockchain technology. They make it possible to raise funds by minting a new digital currency while bringing your launch story to a wide audience.
it is hard to understand the significance of ICOs without a little context. Buzz about bitcoin and other cryptocurrencies has gone mainstream. Most of the focus has been on gyrating, mostly climbing valuations. Many are also excited about the potential of bitcoin to rock the world of money – and blockchain technology to revolutionize how we store and share information.
There are plenty of great articles that tell you why – I won’t take up too much space here. Suffice it to say that blockchain evokes the excitement of early days of the Internet. It combines a so-called trust protocol and distributed ledger that can solve privacy, security, and inclusion issues. Some think that it can deliver on the failed promises of the Internet, put people back in control of their own information, and give them a way to directlty connect and conduct business.
So blockchain is disruptive tech. And ICOs are a disruptive form of fundraising – you don’t need VCs or Wall Street to raise money. If you have any doubt about the importance of ICOs, the numbers tell a dramatic story – Bitcoin News reported that money raised through ICOs eclipsed $1B in a single month in December 2017.
Maxiziming ICO Results
One of the cornerstones of an ICO is the white paper, a document that describes in detail the token offering – and explains why investors (or “participants,” in crypto parlance) should care. What will the business actually do, and why would someone want to hold a new digital currency tied to it?
It’s important to make sure all this is sound. You may not need investment bankers or an army of attorneys – but you do need to comply with regulations, which can seem to be a moving target. Participants need to be careful to avoid scams, in their rush to get in on the action.
The Right Communications and Technology Stuff
The ICO is fertile ground for buzz creation, and a great platform to launch a blockchain or crypto-currency related startup – and we’ve seen many variants, spanning film making, casino junkets, philanthropy, finance and general enterprise tech.
But just like a traditional press release or even a Kickstarter campaign, it needs to be done right. A boring press release blasted out to the masses (”sending and praying”), an ill-conceived Kickstarter campaign, and an ICO without the right communications or tech foundation won’t accomplish much.
How do you build early interest among participants in a presale? Or bring the story to a wider audience, and build brand over the long term? How can you get some attention for your ICO and navigate tough interview questions about scams and bubbles?
It’s a noisy world and a never-ending battle for the consumer’s attention. ICOs and blockchain are new and can be tricky things to explain. People are trying their best to understand what it all means – and where to put their time and money.