There is a new trend in the Crowdfunding market following the downfall of ICO’s. New and safer emerging method of funding for both the investors and the companies that are raising funds is known as IEO (Initial Exchange Offering).
What is an IEO?
An IEO is a method of funding much like an ICO, but is offered on an official exchange, and is not offered only as a coin. The IEO is instead offered and released on an exchange that verifies the company in multiple ways. In addition to verification, the company can only be listed if it meets the exchange’s criteria which include:
- A business model – The company must have a legitimate business model that includes the IEO campaign.
- Progress on the project – The IEO’s hosted on the platforms already have a userbase, the projects are shown and proved to already have the traction necessary to build out new items based on the funding.
- Legitimate documentation and token economics – The projects and companies must have a website and detailed documentation of whitepapers, technical papers, token economic analysis, etc. It should include how the project can succeed and why the associated token will increase in value.
- A growing community – The project must show a healthy growing community. This can include followers or existing clients.
- Reputable team – The company should show a reputable team, which they can verify that these individuals actually work on the project. The project must show the team responsible for the project.
- Social media & PR – You will want to have or be featured on some crypto, tech, or other publications to prove that you are popular, and have a good project and following so far.
- Utility token – You must have utility token. Utility tokens are used for your product or services, they can be purchased much like a security token. The only difference is that you can only use it on the product that you are offering.
Each of the above items will be reviewed by the platform to help mitigate the risk for those investors. Due to some ICO scams, investors hesitate to purchase the coins/invest in the company, but now that the platforms have specific requirements, this will keep the investor’s mind at ease when considering to invest. In addition to the requirements that the company must meet, those who are applying to be listed on the platform are competing with several other companies to be featured on the IEO platform.
How can I get started?
Although you are looking to receive funding from investors, you will need money to start with and prove to have traction to those IEO platforms. One way to accomplish this is to create a rewards and donations based Crowdfunding campaign. Creating a Crowdfunding campaign can help prove the traction, display the business model to the backers, and the IEO platform. It will also help check off the other requirements for the IEO platform such as:
- Progress on the project
- A growing community
- Social media & PR
Not only will you be improving your chances to be featured on the IEO platform, but you will also be gaining the traction and funding needed to help you with the campaign. Keep in mind, you may pass all of the requirements to be listed on the IEO platform, but may never be chosen to be featured. If this is the case, you will still have the audience, and funding available if you want to keep pursuing the business. Let’s see what steps you can take to start using Crowdfunding for your IEO campaign.
Step 1: Use the Sedra widget
If you would like to host the Crowdfunding campaign on your existing website and add all of your branding to the campaign, then it is best to use the Sedra widget provided in the Atlas subscription plans. Setting up the optional widget is very easy, and is explained in this article here: https://www.thrinacia.com/blog/post/thrinacia-atlas-quick-widget-setup
Step 2: Create the rewards
The Crowdfunding campaign should have rewards or some incentive for the user to donate to the campaign. These rewards can include a reservation or a chance at a spot to be listed in the seed round of your IEO campaign. The incentive may change depending on your plans for the IEO, your project/company, etc. The bottom line is that you can offer great incentives that directly correlate to the IEO campaign.
Step 3. Start running the campaign
Once you hash out all of the necessary details for the campaign such as the rewards, the funding goal, and the duration of the campaign. You can start running the campaign on your website. It is best to make sure you have a marketing strategy in place before running the campaign. If you, in fact, do have a product, it is best to utilize your existing customers.
Every project is unique, so these concepts can be altered for your specific situation. There are multiple ways to adopt this strategy for your IEO. For any questions regarding the widget or Atlas platform, you can contact Thrinacia or send an email to hello@thrinacia.com. For more information watch the video below: