CO, as in Initial Coin Offering has become a common financing tool for startups, but make no mistakes, not all that glitters is gold. Especially after attending the Blockshow Singapore 2017, my opinion became even more forge into a believe.
Similarly, some ICO enthusiasts have developed the belief that in almost the same fashion as in a cult, ICO can do no wrong, ICO can do no harm, ICO is the solution to all the problems in this world.
I have too many (although still quite few) white hair on my head to get blindly absorbed in the frenzy.
It is not because new technologies have made me obsolete, at the contrary, history has gifted me with some little wisdom that is not abundantly available in the market nowadays.
So, the way I spell it out might sound as a conspiracy to some, science fiction to others, Hollywood drama to a certain audience or simply just reality slash normality.
I am specifically looking for the latter reader type. The one that has the ability to read between lines, fill the blanks and look at the world in a slightly different way when interesting hypothesis are presented.
Over the past few months I have explored, researched, monitored and analysed some 50 ICOs globally.
And of 50 or so more I have gathered superficial details sufficient for me to connect dots and come back to the same conclusions. As much as I tried to document this effort, it was impractical to standardise the findings.
Especially because the key factors that determine the success or unsuccess of an ICO are generally not quantifiable, but rather qualifiable.
And the quality scale is in constant evolution. So until the balls are still, all the cause — consequence relation is purely arbitrary.
I have spent nearly 20 years in marketing. I claim to know the industry well enough that if a pattern emerges, I could clearly detect it.
But in the ICO world, the marketing efforts and initiatives (read cause) and the sales performance of the token generated (read consequence) is close to zero.
In fact I have seen ICOs with the perfect marketing strategy failing to achieve a fraction of the declared goal, while other ICOs, that I have no qualms in calling them jokes, exceeded the target 10 folds.
Something is profoundly wrong (and to a certain extent disturbing). Here is where a little bit of self caution is required for me as writer.
So I must inform the reader that I am purposely avoiding stating any name, number, percentage or measurable data.
I will use definitions such as “the largest majority of the cases that I have analysed”.This should be read for what it spells.
It categorically does not mean “all”. If the reader makes it 80-20 it is a choice.
If the reader wants to read 99-1, it is another choice. Certainly I do not mean all if write “the largest majority of the cases that I have analysed”, but I also do not intend to say 50-50.
The reader shall deduct the numbers.
So, in the largest majority of the ICO that I have analysed, the formula for success is the same as for a Hollywood blockbuster.
For someone like me, born in the ‘70s, having watched The Flash, Wonder Woman, Batman, Transformers, Spiderman, The Adams Family (etcetera) 30 or more years before they were brought back to life for the Millennial generation, the movie script is the least important piece of data that I would look into shall I try to predict the success of a movie, Similarly I would not bet a cent on any Whitepaper, as “in the largest majority of the ICOs that I have analysed, it had nearly no correlation with the outcome of the token sale to the public, nor with the success of the business.
In the movies industries it is pretty much the same. Boring scripts make blockbuster movies.
Among the parameters that I would probably pay more attention, I would look at the “actors” in the movie.
In the ICO world, they are called Advisers.
In the largest majority of the ICOs that I have analysed, they just put their face and their CV as a “proof” that it will work.
Although it means nothing with regards to the overall success of the business, some ICOs managed to sell more Tokens because the “co-founder of yet another venture” was part of the show.
Lastly, the producers.
Here is where I would bet all my cryptocoins. When was the last time that a Pixar movie did not make the money invested back? Virtually never.
Hence, if Pixar (just to mention one among many) produces a movie with a horrible script and unknown actors, it would still stand chances to make all the money back.
In an ICO, the producers are the hardest to spot. They only gather around in “private talks” before the pre ICO and before any investor (read ‘audience’) bought the token (read ‘the ticket’) to participate the ICO (read ‘watch the movie’). But if you find who is behind the “wow announcement” of how many million of Tokens were sold in the first hour, day, or millisecond of the ICO, then you hit the jackpot.
These are those that never lose an opportunity and always make a profit.
To all the others, good luck.