The startup world is cutthroat.
Thousands upon thousands of startups are created every day. With so many entrepreneurs competing with each other, it’s a constant fight for attention.
This is especially true in the tech world, where marketing is the name of the game. The biggest struggle of upcoming tech companies is getting enough publicity to succeed.
This has made many startups flock towards cryptocurrency and ICOs as a method of gaining traction.
As lots of them succeeded, many startups are attempting to replicate this success by introducing their own ICO to compete against Bitcoin and other leading cryptocurrencies.
What Is An ICO?
ICO stands for Initial Coin Offering, and it is the IPO’s cryptocurrency equivalent. When a company needs to raise funding after starting to offer a product or service, they can launch an ICO. This means they will issue a new cryptocurrency (most of the time based on blockchain technology) tied to their product or service and which aspiring investors can purchase.
This is very similar to the process of buying shares, as the investors hope that the coin will appreciate in value and let them cash in on their investment.
But blockchain-backed cryptocurrencies aren’t actual shares. As opposed to shares, a company or its product can succeed, yet the cryptocurrency issued by the company can fail.
If all this sounds like yet another fad, take note that in 2018, ICOs raised $7,812,150,041 spread among 1253 coins. That comes up to an average of $6,234,756 per coin. What startup wouldn’t like a cushy six million?
The Benefits Of Launching An ICO
1. It’s A Source Of Capital
The main reason to launch an ICO is the funding it will bring to your startup. With over $7 billion raised in 2018 by ICOs, they proved to be an excellent way to get a budding startup off the ground.
Be aware that you need to set terms for your new cryptocurrency in advance. Decide what supply you’re willing to put out in the market. Make sure you’ve got a convincing, well-presented whitepaper ready on your coin offering.
If you’re wondering about how an ICO is different from an IPO or selling shares, one of the answers is simple. Launching an ICO is much easier to do, and involves much less legal and regulatory trouble.
Once you’re ready, launch your ICO with a loud marketing campaign. If your startup is convincing enough, investors will literally be dying to snag a piece of the action.
2. You Get Attention From The Crypto Crowd
One of the greatest advantages you get from launching an ICO is that it’s practically free marketing.
Launching an ICO brings your company to the forefront of one of the fastest growing parts of the tech industry, namely, cryptocurrencies.
If your launch is successful, you’ll soon be facing an abundance of news organizations and websites reporting on your startup. This can get you into the mainstream much easier than you might think.
Cryptocurrency also attracts many wealthy investors, so that you might catch their eyes as well.
3. It Helps You Appear Authoritative
In this day and age, with thousands of startups popping left and right, it can be hard to cement yourself as an authority in your field.
Launching an ICO and maintaining a token can be an excellent way of displaying your authority. Indeed, having a successful ICO launch is similar to having gone through a round or two of funding.
By having a token, you make sure that your brand is associated with what you’re doing. For example, you won’t need to think twice about what agenda the owners of VeganCoin stand for.
Create Your Own Coin Offering
Running a startup is an extremely tricky business. In today’s oversaturated world, you’ll need every edge you can get. Launching an ICO brings one such way to get ahead of the pack and secures your spot as the market leader.
So what are you waiting for? Start planning your very own crypto token today!
Ilija Miljkovac is a cryptocurrency writer and investor. He has been involved in the blockchain and crypto space since the early days of bitcoin. He likes traveling around the world while managing his portfolio and teaching the newcomers in the cryptocurrencies space.
