• 06 April 2021
  • Announcements

Adding Value To Your ICO: Are You Getting Your Money’s Worth?

Blog Bild

Initial Coin Offerings have exploded in popularity in recent times, with many an ICO now often finding itself taking the place of its predecessor, the Initial Public Offering. Whether it’s a company intending to raise funds through an ICO and launch their respective tokens on a crypto exchange or an organisation pushing to fulfil a public listing at a regulated one, there’s plenty of common areas to consider when it comes to requirements.

One key consideration that both the ICO and IPO spheres share is the perquisite for projects to have a board of advisors or team of industry insiders with relevant credentials to be able to clear your project with enhanced levels of credibility. Unsurprisingly, this gives your project an instant value boost. Many projects however find that while there are more than enough advisors out there ready and waiting to give your credibility a nudge in the right direction, the ultimate value that’s added to said project is negligible.

Wondering what’s going on here? You’re not alone. It’s not uncommon to find individuals named as advisors on hundreds upon hundreds of projects. This immediately should raise a red flag, especially when credited projects span over a significant amount of time, with overlaps aplenty and a general timeline that doesn’t add up. If it looks like an advisor credited to your project hasn’t really been able to devote any meaningful amount of time to your company specifically, it’s nigh on impossible that they’ve been able to enhance it with any level of added value.

When you glance at the advisor demographics that work within the demanding world of solo entrepreneurial endeavours, you’ll see that alongside their advising activities, they maintain professional vocations and full-time employment. While some will find it very hard to resist the lure of handling on multiple projects at any one time, overstuffing a workload can leave previous few hours to put a focus on those special projects requiring real levels of insight and expertise. It’s not just enthusiastic entrepreneurs who are causing a breakdown in consistency and quality here either. Companies themselves can also contribute to an ineffective approach that’s costly to budgets and detrimental to output. Many companies buy into the ill-conceived idea of amounting a board of directors that’s big in numbers. However, when a potential investor spots a board of directors that’s soaring in size that might match the ranks of core team members, more red flags can be raised. Looking to bring more believable numbers to your board-building efforts? For most startups, an advisory board can boast anything up to 15 individual experts, with each of these experts looked to deliver anything from 10-20 hours of active work to the project.

It’s easy to see why problems arise here, however. There might be investors with the best intentions in the world, but without having enough free time away from their paid-work obligations, they simply don’t have enough time left in their day to support all those little extras.

Changing the way we do business in general is essential, beginning with the groundwork up. Any investor needs to be sure they’ve carried out proper diligence steps and any goal laid out by project projections is achieved. If you’re unclear as to why someone is even assigned to a project in the first place, don’t show any hesitation in asking f0r more insights.

Investors shouldn’t overlook companies with small advisory boards, even if those groups number at only a few people. In this startup sector, the investor needs to accept that companies are working with restricted budgets and minimal available funding for financing initiatives like advisory boards. Even if a board is very small, the value it can bring to a project can be massive if the insights on the table are illuminating enough.

It’s imperative you steer a change in the way your investors think, taking charge of expectations and landing them squarely in the sector of realistic results. When you do this, you make a bold statement of intent. This focus not only does away with threadbare claims to attempt to boost credibility erroneously, with the likes of return on investment and detailed insight into implementation of base functions the real reading of the day for your investors.

Admittedly, no single one of the above actions are simple to achieve in their own right. In an ideal world, it would seem that a real change in thinking is on the horizon where the proper business framework and infrastructure of projects will become the real hooks that land the leads you want.

To sum it all up, it’s absolutely vital that companies ensure that any advisors they bring into the fold are not only worth their investment, but also able to be held accountable for any insights they introduce. Companies need to be keeping an eye on whether or not changes implemented do in fact deliver any real value, as promised to them by the apparent industry insights given to them by advisors. Rather than flood a project with dozens of barely recognisable names with very little to offer apiece, it’s infinitely more rewarding to refocus available financing on highly relevant advisors who can bring with them the right kind of information and suitable guidance that has a higher chance of guaranteed success.