An Entrepreneur’s Guide To Listing An IEO (Initial Exchange Offerings)
Back in 1864, Herbert Spencer would have never imagined that his quote, “survival of the fittest” would find relevance with today’s blockchain-based fundraising.
This ever-evolving sector is constantly identifying alternatives to protect the interests of investors and offer entrepreneurs with an optimized way to raise capital.
Listing An IEO : An Entrepreneur’s Guide
After Cryptocurrencies became mainstream during the better half of 2017, the market was flooded with a number of Initial Coin Offering (ICO) projects. It was not long before this model garnered a bad name for itself due to inconsistent funding patterns.
However, on the bright side, blockchain-based crowdfunding is on the rise with the pundits valuing the global market in the billions. This positive trend has given birth to a new funding pattern known as Initial Exchange Offering (IEO).
An IEO is a boon for entrepreneurs as it harnesses the popularity and the reach of cryptocurrency exchanges to gather funds for business ventures.
Moreover, investors are encouraged to invest in IEO projects because they are verified by exchanges only after comprehensive background checks.
Finally, the exchanges shoulder the burden of creating tokens and marketing them as well as managing the smart contracts. This enables entrepreneurs to dedicate more time for developing their business strategies or polishing their offerings.
But, how does one go about launching or in this case Listing an IEO project? The process is relatively simple and it involves the following steps:
1. The Initial Spark
It all starts with an idea. Identify a problem in the market and the possible solution to it. Moreover, also research on the different players in your chosen sector as well as potential competitors. The more profound and unique the solution or product, the better it will attract investors and funding to your project.
2. Approaching An Exchange
After you have found your business calling, its time to gear up for the funding process. When planning to utilize the IEO model, one must pay close attention to the choice of exchanges.
Different exchanges offer different commission rates for their services. Make sure you have done your homework before narrowing down on an exchange and allocate a flexible budget to cover any “rainy day” expenses.
3. Earning The Greenlight
As an IEO saying goes, “You don’t choose the exchange, the exchange chooses you!” Simply by choosing the services of a platform does not make you eligible for their listing programme.
Exchanges follow a very strict and rigorous review process. They will grade the veracity of the project, cross-check regulations, and also authenticate your team’s credibility. This is because the reputation of the exchange will suffer in the event of any malicious projects getting promoted.
4. Getting Featured
Once the exchange has completed all the background checks and is happy with your project, it is time to enter the limelight. The exchange will create a fundraising campaign for your project on their platform.
They will also actively promote and market it to all their users, thus giving you instant access to millions of potential investors.
5. The Way Ahead
The exchange will automatically upgrade your project after it reaches the predetermined checkpoints. For example, most platforms will list your tokens on their secondary exchange once it hits the soft cap threshold.
This helps in attracting greater demand for your coin and enables the project to gain better traction in the market.
Initial Exchange Offerings are reimagining the crowdfunding game as multiple projects are collecting funds in record time.
A prime example of this phenomenon is the BitTorrent IEO which reached its target of $7.2 million in less than 14 minutes!
In a nutshell, IEO-based crowdfunding places more emphasis on securing the needs of an investor, that is offering potential token holders with trustworthy projects.
Many budding entrepreneurs now respect this perspective and are optimistic with pursuing their business goals using the new funding medium.
With increased interest and positive feedback, Initial Exchange Offering is here to stay in the long run. This model also harks back to the resilience of blockchain technology to adapt and provide inclusive solutions for modern problems.