1. Intro: the end of a 'era
Let's say things clearly: the second half of 2018 was the end of an era.
It was the end of an era of ICO's dream, where, with the advent of regulations and distrust, the teams could no longer use a few colorful pages on a white paper to raise millions of dollars in just a few hours. . The end of a "era" for the legendary crypto-volatility, after the stabilization of Bitcoin and Altcoins, has suddenly closed the road to 100x returns on a cryptocurrency.
The second part of 2018 showed us a story of undelivered products, failed projects, broken teams – and as a result, the Blockchain space is maturing and the participants are asking to investigate concrete questions and have responded, before believing in a new project. This is the case in particular because almost every ICO in the sphere is launched by a startup, with all the traditional risks involved – and the success of each of these projects, especially the most idealistic ones, is determined by the Founders, the Team, the people behind its. So, they are no longer just ideas and visionaries, but real characters in a professional company, with knowledge, team dynamics and solid skills.
2. Watch an ICO – Invest in a Team
People have stories and even Blockchain startups do. Now, in order to reduce the risk of a bad investment and to identify the most promising ICOs around, let's start the main elements that need to be analyzed in the initial research, in any related ICO risk assessment. The project team, consultants and founders have their own experience, experience, personality, character and culture – and everyone must work together for a successful project.
"As a consultant, I have an interview with some team members to see if they are all on the same page and to ensure they are aware of the ICO space and their business model."
-Catto Savio Gomez, Ph.D.
Management team: the essential part of the evaluation of the blockchain company
Before discussing how to evaluate an ICO in general, before any other technical / financial consideration, we should start considering that the C-level managers and founders are human beings and, as such, must go in the same direction and have the same, clear vision on how their product should be in order to make it work. This will save us from the Beatles – kind of situations in which everyone goes his way.
Here are the main questions you need to investigate:
- The experience in previous managerial positions is extremely important. Check if they have had experience with high budgets (millions of dollars) and because they have left their previous positions to join a new project.
- C-level executives have worked together in the past? Relationships and synergy between levels C are very important.
- Have they founded some startups in the past? What happened to them? If they failed, do they seem to have learned the lesson? A failure is not a bargain, unless it's for you.
- Corporate network and social awareness (influencer, etc.).
- For each of the C levels: this is the right person for this role in this project. Are they coming out of their key competencies? If so, there should be a good reason for doing so.
- A balanced team should include specialists with experience in the target economy, management, finance, marketing, legal, development, sales, investor relations, strategy, blockchain market, strategic and technical specialists.
- If the commercial side is strong, but weak technology, or vice versa – yellow light. Another yellow: the technological side is competent in the vertical sector and DLT?
- Pay close attention to the project hierarchy: all responsibilities and functions must be clearly divided between team members.
Try to consider all the possible gaps in available human resources and make sure the team is aware and plan to meet them. If someone is missing or there are weaknesses in the team, consultants should cover the gap – it is mandatory.
Advisors should not be just names on a white paper: consultants are a key part of every successful project. Not only do they need to be concretely involved and understand the scope of the company, but they also need to provide their expertise to balance the team, cover the above gaps or industry experience and guide them as a wise uncle in moments of panic or doubt.
About consultants, do not forget to ask yourself:
- Do they have a rigorous role?
- What is their reputation, experience and competence?
- Have consultants had any relationship with other team members in the past? What was that?
- How much did their involvement cost? And to what extent are they actually committed? Make sure that it is not just a media personality or a marketing tool to gain credibility.
Always check out all the information on team members and consultants when evaluating ICO teams, make sure that this is all about the whole story.
Previous story of successful financing rounds
As we said, the founders, team members and consultants have stories, just like everyone else. In the world of startups, alongside their relationships, personal experiences and connections, these stories translate into a sort of business history – successful or not.
- Has the team been previously involved in an ICO?
- What funds have they collected?
- Have they received support from VC, Angels or other more traditional rounds of funds?
You should always be able to answer all these questions to make a rational decision.
Transparency and communications
This is a set of questions to consider and do not take anything for granted:
- Communication with investors and the community is important, but how does the team facilitate it? What's up? What is the atmosphere and the attitude with which the team communicates? Are they positive, friendly and transparent or shady and arrogant without a real reason?
- And again on transparency: what kind of reports are published? And how often? Cross-checking of past and new relationships: does the team seem to be manipulating information? Did they recognize mistakes? Are you comfortable with the amount of internal information you've acquired?
- How is the team working? The business side is visible, do developers publish their work anywhere? Leaders are also working on projects elsewhere, and if so, how much time can they spend on this project?
- Relationships with lists of sanctions, criminal or criminal activities, fraud schemes, etc.
3. Tools and assessment resources of the ICO
As you can imagine, all the pieces of information above are scattered on the web. Until now: Kepler Finance collects the key information you need in one platform and prevents you from wasting hours or days searching the Web. It gives you a definite kick-off at the start of the Your initial research, but there are also other important resources that you could consider to better evaluate the teams.
Here is a list of tools you should not overlook during your Blockchain risk assessment research:
- Social media: Linkedin, Facebook, Twitter, Medium
- Company website / ICO
- Personal blogs
- GitHub, ProductHunt
- Crunchbase, websites of connected companies, community resources
"You do a lot of research, you ask a lot of questions, see if people have real and long-term profiles on linkedin / twitter / medium or they just arrived yesterday."
– Simon Cocking
With all these sources, you can reach a rational decision about the project and the team you are thinking of supporting. But always remember to double check your results in a crossed, double and triple way, distinguish paid and unpaid resources, dates of publications, etc. In conclusion, as a reminder, always evaluate an ICO before investing: data-based evaluation, this is where the second non-romantic era of Blockchain begins.