“I am planning to raise $20 million in an ICO. Our product is great and we are launching in a few weeks time. Could you help us with reaching some major media, please?”
This might sound unbelievable, but such kind of requests to PR agencies that deal with Initial Coin Offering (ICO) campaigns are not rare. Over the past few it seems that crypto is experiencing something similar to the dotcom boom, the investment bubble that formed around Internet companies.
16 November, 2017, Victoria Zavyalova, co-founder, V Startup Agency
In the mid 1990s, the speculative craze only hit America, but things are global these days, and the ICO hype is global, affecting the blockchain community around the world. People hoping to raise millions of dollars in an ICO relying on “just a couple of weeks PR campaign” are inspired by the stories of wealth created overnight and the rate of Bitcoin.
Well, I’ve got news for you. It was possible just a few months ago – the ICO hype is over. New startup founders with no experience of running a successful business, or as well as genuine fraudsters, not only affected the blockchain community: they also made headlines in the general media.
ICO is still the most accessible and easiest way to raise investment, and it’s much cheaper than a campaign on the Kickstarter, or a heavily regulated IPO. But both journalists and crypto investors are looking into your backgrounds more attentively.
The example of New York-based Starta Accelerator that raised $5 million in one day for Eastern European startups trying to make it in the U.S., inspired many entrepreneurs. But Starta has been working for a few years with media both globally and in Russia, where the accelerator’s founders come from. When the time for Starta’s ICO campaign came, both professional investors and crypto community understood that it’s for real.
Still, this fact is largely ignored, and some startups still think they can make it with: “Sorry that I can’t name all the founders; they’ve just met so not everyone knows everybody.”
We’ve been frequently asked when is the best time to start an ICO campaign, and the answer has been changing with the market. Now, I’d say: start building your reputation at least a few years before your ICO.
Try to launch at least one business, get some traction, and score a few good headlines in media. In this case, you’ll have the luxury of being able to mount a 3-month PR campaign for your ICO, which is the very minimum but most probable option in the new market reality. Even with a successful track record, you’ll probably need six months.
When you raise your millions, the story is not over. You have to communicate with your investors and you should have a good strategy for this. Otherwise, how can they know you are meeting their expectations unlike the many fake blockchain projects flooding the market?
The future of blockchain and ICO as a fundraising instrument for young tech companies is being created now, and it depends on all of us.