An ICO campaign is a packed operation usually with a duration of 4 to 10 months. Throughout the ICO a lot of actions and parameters kick in eventually shaping and affecting the end results of the process. Perhaps the biggest aspect one must take into consideration when choosing an ICO to participate in is its Community, a simple word that says so much.
The project’s community is its audience. People who chose to associate themselves with the project vision and team ending up joining the conversation channels and following the project on social media. The community consists of many different profiles: some are Tech enthusiasts, others search for the next best ROI, bounty hunters, industry groupies and many more. In this piece, we will try to explain how we at BITSME look at the community and why in our opinion it is the most important thing an ICO project should strive to have and why you as a potential contributor should pay special attention to evaluate its quality.
This article is not suggesting for a second that content and essence does not matter, rather it highlights the point that even the most innovative initiative will not succeed without a wide support behind it.
BITSME is a community building and consulting firm. Since our incorporation and even before as individuals we have assisted several ICOs building their community structures helping them to gather around them the most effective and contributing community members.
By the end of the day, it is all about the numbers
An ICO is a modern way of conducting a financial crowd-funding. The ability a project has to avoid giving away the majority of their equity to old fashioned venture capitals is priceless. In the new ICO era that VC is being replaced by thousands of small partners, each has almost no stand but together they might be even stronger than the VC. Although not holding any equity the community has control over the most important asset of the company – its token. It is often said the ICOs are actually “bringing the VC to the people”, this phrase sums the idea behind an ICO – letting everyone in, making room for contributions from few dollars to millions, letting everyone take part in a project they believe in.
Getting back to the practical side of things, in late 2012 when the ICO concept was first introduced in the crypto market until not too long ago, the community part was exactly as described above. Almost the entire funding target (Hard cap) came straight from those “small contributors”. In Matchpool’s ICO for example back in April 2017, 125,000 Ethereum were raised within a single day. Out of the total sum valued back then at USD 6 Million, USD 250K were secured as a private sale before the official fundraiser started, leaving the rest of the Hard cap originating from 2,200 different participants of different magnitude. In Matchpool’s case, 96% of the raised funds came straight from the general community in the public sale. This is far from the current market standard today.
While by the Matchpool ICO date there were around 4 ICOs each month, these days ICO/TGE numbers have surged to around 100-150 every single month. With the contributor’s population staying behind ICOs in terms of growth, each ICO conducting project now days has to compete with dozens on the community’s attention. This fierce competition is now resulting in a paradigm shift – uncertain about the number of contributions they will secure in the public round, projects now strive to guarantee as much as they can through private pre-sale rounds with high bonuses normally summing in around 60-70% of the entire tokens portion allocated to the public.
Who are those private sale members you ask? Well, they are usually one of these two possibilities: – sophisticated investors now identifying Blockchain ventures as new investment opportunities or experienced ICO investors scaling their game with higher contributions or by syndicating with others. The main point here is that regardless of their profile, what gets these private investors to join in is actually the same magic factor – The Community. The private round investors are also making their decision to participate based on their evaluation on the general community strength, the stronger it is the easier it will be for the project to lock down those private investors.
To sum it up, although the composition of the ICO contributors has changed from being all around public small participants to mostly consist of private bigger contributors, they all a direct result of the projects community strength or its impression. Understanding that will help you play your cards right if you are a project going down this road or a potential ICO contributor.
How to get the best community for your ICO?
The Million-dollar question. Obviously, by the end of the day, innovative projects with real value, high profiles behind it and a clear justified use case is accounted for almost 80% of their community size and quality. However, this other 20% can make all the difference so let’s talk about what you can do to maximize it and ensure your success.
Based on the above, achieving big and high quality community members will probably be all you need. The fact of the matter is that no one knows the precise answer to that question as it is all about general effort and not a specific action if one claims otherwise my best tip for you will be to walk away as far as you can from that offer. BITSME has been involved in its fair share of successful campaigns and none of them were alike. In this hot trendy market, what was the key to success a month ago may not be relevant anymore today. Here are few elements we are focusing on our clients:
Be everywhere – It’s not a slogan it’s a necessity. Today’s competition for the community attention is so fierce, a project can’t afford not to be represented in a certain channel. Open an account and keep its ongoing maintenance with a designated community manager at least at Reddit, Telegram, Facebook, Twitter, Steemit, Discord, Bitcointalk, Instagram, Linkedin, Youtube and any other platform you can afford to.
Make sure your community managers are “Crypto experts” – Unlike other industries a crypto expert can be someone with as little as 2 years of experience. It is essential that the people you have in the front will know how to talk the crypto language, know the history and market standards of other ICOs and be able to give you real time examples and updates from your surrounding. Don’t turn your community managers into hosts as they are probably the most important individuals in your entire team.
Be transparent and informative – Too many projects out there fail to understand the value of sharing their progress with the community each step of the way. In order to have a supportive community behind your project, you need to make them feel like they are part of it. This can be done by releasing weekly newsletter, updating you progress constantly on the open conversation channels or simply by publishing it in your blog. The result of you sharing updates is having a large number of written materials to be shared in the huge pool of ICO and Blockchain information out there, you may never know who will end up reading it.
Don’t launch prematurely – In such a saturated market first impression is what makes the difference. Make your best to have as much of your site, Whitepaper and product ready before officially launching your campaign. It is better to stay in stealth mode focusing on other aspects of the ICO or just creating content than to go live with nothing to show for.
Evaluating an ICO community - separating the good from the rest
As already mentioned, a strong community depends on much more than just a number. Just a year ago, a Telegram group with 1K members was considered something special. Nowdays with Airdrops becoming more and more popular we can see Telegram groups having as much as 100K members. A quick visit in sites like Airdrop Alert will give you plenty examples of groups with abundant population and zero constructive discussion, either you can hear a pin drop from miles away or have endless messages asking when the Airdrop/Bounty is due.
As there are endless checks to be carried out, we will spare the obvious checks and signs and name here only a few easy tricks for you to take into consideration when assessing a certain project community:
Check the existence of a Telegram bot to find better data and analytics about the discussion – If you are lucky enough the project’s community team is using Telegram’s assisting bots such as Combot. Simply type “/” on the text box to check for a bot existence. In case the group has one of those, just activate it and explore the different information in it.
Scroll back several days and check who generates most of the discussion – With or without a bot this is a simple and quick check that can tell a great deal about the community. We often see ICO Telegram groups with hundreds of daily massages, check who is behind those messages, is it the team's representatives? a “welcome bot”? or is it actually multiple participants with a genuine interest in the project.
Ask the community managers why the project needs its own token – This simple question is actually a great way to separate between a solid thought through the project and an opportunist venture without real merit. Put the community managers to test, see if they know their stuff or start mumbling incoherent answers.
Go over the members' list – get an estimation of the number of fake bounty hunters. Unfortunately, as a lot of money is involved an entire industry of buying Telegram users has appeared. Before committing to any project, chose randomly 10 members and send them a private message. If they are real they will understand and even appreciate your due diligence, and if not then consider that as a big warning sign.
Use SimilarWeb traffic extension on the project site – although usually updated only to the previous month, using free traffic measurement tool can give you some great insights. Check the number of monthly site hits to have a basic hype assumption, check the “Geo” and “Source” of the incoming and outgoing traffic to better understand its quality. Traffic originating from Reddit for example, is considered of much greater value than from Bitcointalk same as for every other traffic from sponsored sites.
In conclusion
A community is pretty much everything in the concept and execution side of an ICO. It has many forms and patterns and can often be manipulated and misleading. It is extremely important to understand that the community role does not end on the ICO and is even of great importance the minute after in the secondary market, as it is the one who has the power to generate hype and demand when the token get finally listed. So if you are a team member of a project initiating an ICO, nurture your community as it is your biggest asset, and if you are on the other side of that equation, make sure you are not a sheep in the herd, check those on your right and left and ask the hard questions even if you’re not being the coolest kid in class.