There are two hostile teams when it comes to the philosophy of deciding how to spend your initial ICO budget.
1st team of conservative business man think that you should first build you product in full and only then start your ICO sale.
2nd team on tech savvy people who understand the idea behind ICO think that you should spend all your money on marketing and build your product from raised funds.
As you probably understood I favor 2nd plan, and will explain to you why it is a better roadmap.
Product first – Why not to do this way:
- Credibility for your project. While having ready made product will definitely give you more credibility, there is one problem: How will you tell people about it with no marketing budget?
- You may think that after you have a product you will easily get money from private investors in closed private-sale, but that is a myth. Getting money from investors is one of the hardest things in business, a clever investor will be looking for a project that has a hype already, which you don’t have.
- More risk. When you have invested $100k-$500k in tech development you can’t quit anymore. As if you quit you will loose all that money, you are now too heavily connected to the project.
Marketing first – Why to do this way:
- Online everything is about marketing. When there is thousands ICOs, not the best ones get the attention but those that are being promoted the most. Of course you need to have a good business plan, but most of the ICOs haven’t started developing their product.
- While promoting your ICO and getting feedback you might end up changing your product. Lot of ICOs do at least tiny changes and if you have build up your product already, it will cost more to edit it. But when it’s just on the paper you can change what ever you want or redesign it completely.
- Less risk. If you find out that you idea was stupid and would not be able to raise any funds, you can still quit and bare only lite loss of time and funds. And then you can focus on new project.
As in any business it all comes down to marketing, promotion and branding. Now matter how good your product is, if you can’t tell the world about it, it will never succeed.