5 Tips for Evaluating Initial Coin Offerings (ICOs)
Today’s blog post is for those who are looking to invest in an ICO, also for those who already have. Why not check your ICOs against our short and sweet evaluation guide?
That’s right, investing in ICOs can be a risky business, so we highly recommend you to evaluate every Initial Coin Offering against certain criteria.
Here’s our ICO evaluation guide that is not to be taken as investment advice!
1. How unique is the idea?
Let’s be honest, it’s difficult, almost impossible, to invent the wheel these days. But some ideas are better than others. Look for something that stands out. It’s doesn’t have to be a new idea, but an improved version of a successful idea or something that’s just better than anything else in the market.
It’s also worth checking how old an ICO is. If it has been around for at least some time (1-3 years), chances are, it won’t fail in the nearest future.
2. Transparency, Business Case, Pitch Deck, and Whitepaper
Evaluating ICOs, many investors don’t read any of these papers. Well, you should. The more transparent an ICO is, the more crucial details you’ll be able to fish out.
Many investors avoid reading the important business documents being afraid of technical terms and complex language, but even if that’s the case, you’ll still be able to understand the majority of the text. PLEASE READ THE BUSINESS CASE, PITCH DECK, OR WHITEPAPER OF THE ICO YOU’RE INTERESTED IN – whatever is available on the website. If you can’t find any of the documents on the ICO’s website, don’t be shy to contact them!
Before investing, you need to have a clear understanding of what the project is. If you can’t be bothered to go through what actually represents the ICO, better buy a lottery.
In addition to checking business documentation, if it’s a project you don’t know anything about, find out more about their team. Who are the team members? What background do they have? Can they run a company? Do they know how to monetize ideas?
After all, an idea is worth very little if it can’t be realized properly.
Never trust a roadmap blindly, but every startup should have one. A roadmap gives you a rough estimate of what the ICO of your immediate interest is planning to launch short-term and/or develop long-term. It will also give you an idea which phase the project is in. Are they live? Are they beta-testing? Take your time to go through their roadmap!
5. Community, Press, Partners
Community, press, and partners speak for themselves, community most of all. These days, you can buy all the media coverage and excellent ICO reviews you want, but you can’t buy a strong community, you have to build it from scratch and work hard to maintain it.
The CoinMetro Team prides itself in having built an amazing community of true believers. Having people who fully support you is of great help during the development and testing phase because real feedback from real people is invaluable.
Before you decide to invest in an ICO, or if you have already invested in one, make sure to check it against our 5 tips!
Questions, suggestions, anything else? You’re welcome to the comments section below!
The CoinMetro Team