During the last months, the ICO process became an investment tool for non-initiated or mainstream investors. This easily accessible investment has, however, some risks and disadvantages for non-initiated. ICO is a risky investment and many precautions have to be made by the investors, based on some qualitative and “quantitative” (in some cases) metrics. In this article, we provide some parameters which can be relevant to score or have a clear idea of the project and the investment.
Advice to ICO investor:
The following indicators are constructed through a representative sample of a hundred of closed ICOs. Different pertinent precursors of success were identified in order to construct a model of evaluation.
Since the projects addressed by ICOs are not achieved or are in testing phase, their evaluation methods are mainly based on non-quantitative parameters and projections on the qualitative characteristics.
How can you analyze an ICO project:
- The team and the project:
The first step of the analysis has to be focused on the project and the team supporting the project. In most of the cases, the projects are represented by business applications. In these cases, the business projection and market analysis have to be provided for the investors and ideally, an existing structure of the business is of prime interest (not yet with blockchain). For new structural blockchain project creations (new networks), the white paper and the technical descriptions are the founding component.
- The White paper with technical descriptions:
Mostly, these white papers are for very technical people and for this reason an audit has to be made and a particular attention to the team skills and their complementarities should be done. The skills must be blockchain oriented (cryptography, distributed systems, and decision protocols).
Another critical point is the availability of a test-net or minimum valuable product that consolidates the concepts and gives a visibility for the investors (MVP).
Even for new networks, business applications and real use cases and improvements have to be described.
- The legal aspects:
Finally, a solid legal foundation has to be clarified for the investors to guarantee the responsibilities and the planned investments.
The approach described above, is the one we strictly followed to prepare the NeuroChain ICO. We are proud to provide maximum information and clarity for the investors.
Some quantitative models and our ICO analysis will provide in the next posts.
Invest Smart. Invest NeuroChain.
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