Importance of Marketing in 2020 for IEO

 

IEO is a crowdfunding technique in a crypto market. Entrepreneurs launch an IEO to raise funds for their project. Tokens are issued by the entrepreneurs for their project. The investors can purchase these tokens in exchange for cryptocurrency like Bitcoin, Ethereum, etc. The tokens are not sold directly to the investors but through an exchange. These exchanges are responsible for marketing and trading these tokens. Although exchanges are accountable for marketing an IEO, one should never fully trust these exchanges. Every entrepreneur should equally participate in marketing their project.

IEOs are the latest trend. Many entrepreneurs are launching new IEOs for their project. If you are planning to start an IEO, you must know that marketing is very crucial for the success of an IEO. Many entrepreneurs even approach professional companies to launch and market their IEO. These companies provide excellent IEO Launch Services and IEO Solutions. In this post, we will discuss the importance of IEO marketing and understand why marketing should be your top priority for IEO. IEO marketing can be divided into three stages.

Three Stages of IEO Marketing

1. Pre IEO Marketing

In this stage, you need to inform the investors about the IEO. You should create awareness about their project, token and company. It is done to create hype among the audience and to make the IEO launch successful. This stage of marketing plays a very important role in creating a huge opening for an IEO. 

2. Ongoing IEO Marketing

This is the second stage of marketing. In this stage, the IEO is already running. The time period is very short at this stage, so the marketing techniques need to be quick and fast. Most people prefer social media marketing, campaigns and content marketing. It is done to boost the sale of tokens. You need to expand your audience reach in this stage.

3. Post-IEO Marketing

This is the last and final stage of IEO marketing. You need to give your all at this stage. It is mostly done to inform the investors that token launch is over. It shows the credibility of the project. It is also done to increase the demand for the coin in the crypto market. High demand will increase the price of the coin. You can create a marketing website to keep the investors updated.

These are the three important stages of marketing an IEO. You need to plan each stage ahead of time to make the most of market conditions. 

Tools and techniques of IEO Marketing

There are many different ways in which you can market an IEO. You can adopt various marketing tools and techniques to market your IEO project. Here are some common marketing strategies adopted by entrepreneurs to promote IEO.

• Referral programs
• Cross-marketing (marketing along with exchanges)
• Influential Marketing
• Market-centric Promotion
• Press Releases
• IEO Aggregators
• Bounty Campaigns
• Social Media Marketing
• E-mail Marketing
• Airdrops
• Content Marketing
• Marketing Website
• Mouth Publicity

These are a few techniques and strategies used in launching most of the successful IEOs.

Importance of Marketing for IEO

As we have discussed before marketing plays a crucial role in the success of an IEO. Here we are going to discuss the importance of marketing for IEO projects.

Network of followers

When you market your IEO, people get to know about it. All the marketing will create hype about your IEO. If the investors like your ideas, you will gain a large number of followers for your IEO project. It will eventually help you to generate a strong network of followers.

Brand awareness

When you are new in the market, investors will judge your project and your company. With marketing strategies like influential marketing and press release, you can turn these judging investors into potential investors. It also makes people aware of your brand. Marketing increases brand awareness among investors.

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The race between IEO and STO and why is the latter better

 

What is an STO?

STO stands for Security Token Offering. Like ICO, STOs are issued to raise money for the business. However, these security tokens are backed by real assets, i.e. equity, debt, loans, funds, etc. STO is a blend of ICO (Initial Coin Offering) and IPO (Initial Public Offering). It was established as a secure form of raising funds after ICO suffered from frauds and scams. In early 2019 STOs increased by 135%. 

What is an IEO?

IEO stands for Initial Exchange Offering. It is an ICO done through the exchange. Instead of issuing the tokens directly to the investors, tokens are listed on exchanges for the investors to invest. Investors can instantly buy tokens from exchange using the funds stored in their exchange wallet. It is more secure than ICO, but there is no regulation. IEO came into action when ICO started facing a downfall. Binance was the first IEO cryptocurrency exchange.

Advantages and disadvantages of STO

Let’s read about the benefits and drawbacks of STO to see if it is better than IEO.

Advantages

• Regulatory Compliance: It is one of the main benefits of STO. It is compliant with regulations. Unlike many other ICOs which faced cease and desist orders in the US, STO just needs to file for exemptions with the SEC to keep going.
• Safe: As STOs are regulated, there is no chance of fraud or scam from new investors. It is safe to raise funds and invest.
• Transparency: There is full transparency in STOs. The investors can see all the tokens that are issued. The investors can safely invest as there is transparency in STO.
• No entry barrier: There are very fewer entry barriers in STOs compared to IEOs. IEOs requires a very long procedure to issue shares. There are many parties involved. Lots of expenses are incurred in the IEO. Whereas STOs are easy to raise funds without any barriers.
• Flexibility: STOs provide flexibility in running the business. You can have complete control over the business and run it accordingly. The security tokens can also be traded after the initial selling is done. It increases liquidity.
• Global Investors: As the token standards are universal, they can be traded all around the global. It increases the number of global investors as there are no restrictions. It is not at all time-consuming, which makes it even better. The funds can be easily liquidated by investors.
• Fractional Ownership: Tokens allow the security asset to be divided into smaller units, thereby enabling fractional ownership. It also makes the token easier to transfer.

Disadvantages

• Complex Compliance: Compliance can become a significant hindrance as the process becomes very complex. It has to follow the same compliance as an IPO which makes the process complex and increases legal risks.
• New Market: STO was launched in 2018, so it is fairly new. Also, the market in which STOs are issued is quite new. There can be long-term risks associated with it. New rules and regulation can be introduced, and a lot can happen in a new market.
• The platform needed to manage tokens: STO needs a digital platform to be run. Also, the tokens need to be managed through that platform. It needs a whole setup from where the funds can be raised, and tokens can be issued. 

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Ways in which documentation drafting impacts your IEO Project

 

Ideally talking, a blockchain project’s whitepaper is drafted and refined by the project team. This isn’t contrite; after all, nobody will comprehend how to enunciate the privileges of your project better than you would. However, many projects slump by only letting themselves to observe the whitepaper draft before making live to the audience.

To make sure that your whitepaper is up to mark, you must consult with external specialists in the cryptocurrency market. They will assist you in making revisions and noticeable modifications to your whitepaper, and ensure that people see your project in a positive light.

This doesn’t merely cover your whitepaper, though; this can pertain to any official documentation and press release that you would put out. With considerations to the whitepaper, information that commonly needs to be inspected incorporates the technical features of the project, how your token w.ill be operating, project structure, etc. Cryptocurrency exchanges are inclined to put your project through a highly austere due diligence process before affirming you for an IEO.

The rationale for this is that the exchanges reveal themselves up to a lot of vulnerability by driving and promoting projects through their launchpads if they deem your project as a bust, or worse if they consider it is a scam, it is questionable that they will jeopardize their reputation with their clients simply to host your project.

White Paper

Starting now, you will encounter a list of the critical things that you should have in order before ascending for an IEO:

• A Breakdown of Your Team
• A Competent Team
• A Record of your Competitors and Risks to your Project.
• A Detailed and Clear Description of How your Model Will Work
• How the Project’s Financial Model Works
• Tokenomics
• Your Target Market

 As a precept, to decrease the risks of a company intending to launch IEO projects, unique quality, expert, and thorough illustration of all documentation (including corporate) of both the future project and the company is needed. This step will acknowledge summoning in compliance with the formal and technical elements of the project with statutory requirements.

As part of the administration of IEO projects, IEO Consulting Services administers extensive services for the composition and preparation of the complete assortment mandatory for registration and assuring the continued prosperous execution of the company documentation.

Besides, ieo development services assist in the process of KYC (Know Your Client). KYC is one of the global control standards, the essence of which is diminished to the method for classifying and documenting clients.

The main elements of White Paper are:

• Commercial and technical specification of the nature of the project
• Characterization and evaluation of the market on which the launched project is aimed
• The account of obstacles that the project aims to solve
• The main advantages of the plan (platform)
• Purpose of the token within the project, etc.

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Raising Funds with IEO’s – Risks and liabilities involved

 

After the collapse of ICO (Initial Coin Offering), IEO (Initial Exchange offering) have become quite popular in the cryptocurrency world. In IEO, the tokens are not directly sold to the investors. The tokens are listed on exchanges for the investor to buy. It was introduced to reduce the risks of fraud and scam, which was the reason for the downfall of ICO.

Parties Involved In IEO

Unlike ICO, there are three parties involved in IEO. They are as follows,

• Token Issuers: It is the issuing company who wants to raise money for their project. It can be a company or an individual. They have to list their tokens on exchanges so that the investors can buy the tokens and help raise funds required to start the project. Most of the projects are start-ups as there are no restrictions on raising funds.
• Exchanges: They are the link between token issuers and investors. In ICO, there are no exchanges. The exchanges list the tokens and help the issuer to raise money. Most of the work is done by exchanges. They receive listing fees in return. Exchanges make the whole process much safer for the investors and reduce the burden of the token issuers.
• Investors: Investor is those who buy the tokens which are listed on exchanges. The investors have to make the payment in the form of cryptocurrency. Investors prefer IEO, as it is safe and trustworthy. They have to fill in KYC forms with the exchanges in order to buy the tokens.

IEOs are trustworthy but not entirely safe. There are various risks and liabilities involved in raising funds with IEO.

Risks and Liabilities faced by the Token Issuer

Many people think the issuing company is always safe and less prone to risks, and it is still the investors who face scams and frauds. But in IEO, even the token issuer face various risks while raising funds. Some of the risks and liabilities faced by the token issuer are,

• Listing Fees: If you think you can simply list your tokens and get funds, you are absolutely wrong. The token issuer has to pay listing fees to the exchange in order to list the token. Sometimes when the project is unable to raise funds, the token issuer has to bear the loss of listing fees.
• Marketing Fees: The token issuer has to pay an additional marketing fee to receive IEO development services when they need additional marketing or consultation or  different IEO solutions. Sometimes when the project is unable to raise funds, the token issuer has to bear the loss of marketing fees.
• No Guarantee of success: Even though the exchange helps the token issuer in raising funds, there is no guarantee that the goal will be achieved. Exchanges don’t guarantee the success of the project. In the end, the token issuer is the one who will incur the loss.
• Regulation issues: IEO face various regulatory issues. It has evermore been a subject of deliberation. The token issuer has to be very careful while dealing with regulation as one slight slip up can lead to legal issues. Many people say that it will face the same regulatory issues faced by ICO.
• Hackers: Nothing is ever foolproof. Hacking is not a new thing in the cryptocurrency world. The fact that everything happens online put everything at a higher risk. Although it is difficult, hackers can still hack the system and commit theft. The issuer has to face the consequences in the end. 
• Legal Issues: In some countries, there are different laws pertaining to IEO, hence the issuer has to be very careful while targeting the market and audience. 

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How to Strategize Content Marketing for STO Project

 

In the world of security token marketers, things are pretty much different. STOs are just occasionally not allowed to operate with conventional retail investors, probably because of the regulatory restrictions in several jurisdictions. In the US, the legislation does not allow the participation of non-accredited investors in most STOs. Therefore, the marketing strategy of a security token provider should be extensively geared in the direction of accredited and sophisticated investors.

Sophisticated investors are normally well educated and are experts in all the common finance-related topics. They usually have an above-the-average capital pool or high recurring income. They insist on more careful because of diligence and won’t like to jump on board due to any kind of fancy website or endorsement.

Therefore, when you plan to launch an STO, it is extremely important to get your compliance right and make the necessary documentation available to investors.

The first step that is included in STO marketing is defining your goals. You must explore who exactly you are talking to. If you are working with a good STO development company that also offers STO marketing solutions, then that section should be taken care of by the company.

The second most important step is to create a detailed content marketing strategy for your STO project.

Content is the Voice of Your Brand

Most of the people are aware of the fact that “content is the ultimate king”. Well, yeah! Content has the potential to draw millions of eyeballs globally. If you create and share the right content about your STO project most frequently on the different mediums, this will help you gain trust amongst the global audience.

An Active Blog – The Actual Game Changer

Blog posts and detailed articles can help you to provide relevant knowledge to the whole world and educate potential readers through your own personal articles. It is highly recommended for companies as well as start-ups to maintain an active blog through which they can provide development related updates or educates the entire community about their niche.

You can begin with updating just 2 blogs or articles in a month. Setting up a blog is quite a simple task. It should not take longer than 1 hour. Today, there are many easy-to-use tools are available. For example, WordPress.org is quite handy tool. You can also go with third parties like Steemit and Medium.

Many of us believe in the fact that setting up a blog will not attract much traffic in the beginning and can waste a lot of time. That is actually true – a blog may take 3-5 months to gain desired traffic initially, but it will be noticed if you create a high-quality blog content.

Use Third-Party Blogging Platforms

If you are looking for the faster results, you can trust renowned third-party blogging platforms to get your articles published. Medium and Steemit are one of the best options to consider. Getting assistance from such platforms, you can expect your content exposure to millions of readers. Steemit is the blockchain platform that is widely used by many Cryptocurrency enthusiasts. Medium is one of the most professional platforms that expose its content to more general readers. The final decision is on you, depending on who you want to reach. Many companies offering STO development services trust these third-party platforms for blog publishing and better results.

Social Media Post Content

Social media is considered as one of the best ways to connect and reach the potential audience in any niche. Content is needed everywhere – in the social media posts, videos, images, and infographics. In other words, the strength of your social media page is actually determined by the strength of your content. Social media posts are concise, impressive, and interesting. Include quotes, ask questions, and share your achievements, polls, and funny post on your social media page to get more customer engagements.

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Impact of book building and book running on your fundraising

 

Book building is a crucial step that cannot be skipped for your fundraising project. To state the obvious, book building is that process by which you arrive at the price of your security as a company when offering shares for sale in an IPO. It is firmly established that book building is the most efficient and popular process to price your securities in the market. It comes before reaching out to IEO Consulting Services, STO Development Services or ico development services. Obviously, you have to find out and establish your price before going about trying to streamline what you have to offer. You separately require ieo development service for your IEO, STO Consulting Services for STO and ICO software development for your ICO project, but book keeping and book running are relevant and constitute a crucial part in all these. Therefore, let’s look into the impact book building and book keeping have on your fundraising.

Book Building

Credibility Evaluation

Credibility is everything when it comes to business. People invest in you because they believe in you. They believe that your company has potential. And it is important that you get a feel of what the general public perceive about your product. Book building acts as an evaluation mechanism and helps ascertain the worth of the security you offer and your company’s credibility in the public sphere. Also, the entire process follows a wholesale basis.

Price Determination

To make it big with your offering, it is imperative that you know where you stand with your instrument. Book building facilitates a realistic, accurate perspective of investors’ response and commitments to the issue, thereby giving you clues and information to help you arrive at fixing a price for your instrument.

Demand Indicators

You are into this business for making some profit, if not a bulky one, in the first place. You need enough funding. You expect a handsome return of the time and effort you put in. Therefore, fixing the best price possible is the logical step towards that direction. And accurate perspective of the demand coming your way is the key. Only then you can get a picture of the highest market price for your shares and securities as well as the level of demand from promising investors.

Issuer’s benefit

Book building benefits the issuing company as it offers a scope for realistic pricing of the issue, the final price being decided 11 to 12 days prior to the opening of the issue. Another benefit is that book building offers the company an early access to capital. Furthermore, apart from bringing in liquidity and buoyancy, book building also facilitates a timely flow of information regarding issues, investors, syndicate members and lead managers.

Avoidance of the uncertain

For businesses, uncertainties impose risk and risk spells loss of profit and worse, even loss of capital, down the line. Therefore uncertainty is something a company or business cannot simply afford to accommodate. But with book building there is a possibility for a pre-sale of the issue which grants an early snapshot of the scheme of things, thereby doing away with uncertainties that may loom over the fate of the issue. Also, apart from facilitating transparency of allocation, you can enjoy a certain degree of flexibility with the price as well as size of your offering.

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Security Token Offering Licensing – Explained

 

Unlike other fundraising tools, Security Token Offering generates security tokens that operate within legal boundaries. A token is classified as a security token when there is an expectation of profit from other’s efforts. If an initial coin offering does not obey specific regulations, it can subject to penalties. Nonetheless, if all the regulations are effectively met, these tokens have strong use-cases. A security token is equivalent to an investment contract. In other words, a security token is an investment contract that showcases officially authorized or legal ownership of a digital or physical asset. It is important that this kind of ownership should be verified within the blockchain. Once the ownership is verified, the security token owner can use them as collateral for a loan, store them in various types of wallets, and trade away their security tokens for other assets. 

The Actual value in security tokens lies in how they can redefine the true meaning of ownership. Token owners can democratize assets and also distribute them amongst many people across the world. Let’s understand this with an example; instead of buying a gold coin, which is any way out of many people’s budgets, it is now clearly possible for around one hundred people to own the fractions of the gold coin. Sounds interesting? 

If you are willing to offer STO Launch Services or hire some, you have to be concerned about their licensing.

There are certain kinds of regulations that your security token must be subjected to. 
Nowadays, an increased number of blockchain companies are willing to plan and launch a security token securely as investments. Nonetheless, many of these companies have discovered that a successful launch of STO can be an overwhelming task. The process involves consideration of a wide collection of legal aspects. A few of them are explained below. Please take a look!

Incorporation of Security Token Issuer

The jurisdiction in which a security token issuer incorporates can have a deep impact on the structure of STO. Picking up an appropriate jurisdiction of incorporation of the issuer will depend on several factors like the physical location of the asset or interest that you want to tokenize, the countries or country where the founders of the issuer are considered residents for tax purposes, income-tax rates, and applicable tax laws. 

Choosing an appropriate jurisdiction will also depend on the type and classification of such interest, marketing strategy, whether the issuer needs access to any banking services or appropriate security regulations, and other applicable laws. The issuer of the token should know and discuss several jurisdictional attributes with a well-informed legal representative and tax advisor before picking where to incorporate.

KYC/AML

Nowadays, many of the countries impose AML (Anti-Money Laundering) and KYC (Know Your Customer) prerequisites on all financial businesses, including issuers of security tokens. These prerequisites ensure that the funds that are used in investment of security tokens have not come from unlawful resources.

KYC screening has to be done in order to comply with securities laws. KYC process is also an important step in knowing which investors should also undergo the accreditation process.

Security Regulation

Security tokens must be sold or offered after registering with SEC (Securities and Exchange Commission). However, registration can be a slow and overwhelming process. Some of the most popular legal exemptions that are used by many issuers for their token sales to be exempt from registration are explained as follows

Regulation A+

Regulation A+ is categorized into Tier I and Tier II. According to Tier I, the issuer can raise to 20$ million and it does not pre-empt state laws of registration. And according to Tier II, the issuer is allowed to rise to 50$ million and it can pre-empt state laws of securities registration. This is famous amongst STO, but the shortcoming is the lawful expenses of going all the way through the SEC review procedure and ongoing maintaining annual or semi-annual reporting prerequisites.

Regulation CF

Regulation CF is also known by the name of crowdfunding exemption. It allows Security Token Offerings to be sold or offered to accredited as well as unaccredited investors. It has gained immense popularity amongst start-ups that are focusing on raising seed capital from unaccredited investors. The downside is that there is a limit on raising capital.

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