Stages of Budgeting an ICO, Part VII
From the Idea to the Process
The world of startups was set alight by ICO phenomenon! What’s for ICO?! There are many points of view on financial business instruments, but we want to share our own one as well as all pros and cons about that issue. We’d like to to tell you about all the startup investment opportunities taking our project as an example.
Lots of people are burning with the idea that everyone wants to invest in them, but it’s far from being the case. It takes much time from the team and it’s a really hard work. Any entrepreneur is working on the project 24/7 and, regardless of where he is and what he’s doing, the processes of finding solutions occur on subconscious level and hit you at some point. Investments occur after a complicated factor combination.
I’d like to share a mini-story about fundraising using our startup as an example.
The Pitch at the Shopping Mall
One fine Saturday, I was wandering around a shopping mall. Entering a shoe store, I noticed one of Top-3 businessmen of Belarus as of to that time. I slowly moved to the exit at first and then turned around and decided that I’d probably never be given such a chance anymore. I didn’t even google his name, I knew him only by sight. I came to him and started mumbling something about our e-commerce project. Listening to myself I was realizing that I was talking nonsense confusing the facts, but my companion couldn’t get away as he was sitting with no shoes on him waiting to be served by the shop staff with another pair. He told me he previously got interested in Alibaba Project and gave me his phone number. We agreed to get in touch on Thursday.
And the day has come. I realized, that Mr. Businessman gave his number for me just to leave him alone and get rid of my spoopsy speech, but he was barefoot and had no chance to leave. Calling him I wasn’t sure he’d answer and confirm the appointment. I was dialing several times, but the line was busy but finally he picked up the phone and we agreed to meet the next day. We didn’t complete any agreement but the conversation itself was pleasant and interesting, what is more — a skillful businessman inspired me a lot.
I was pitching thousands of times in thousands of places, I even caught some investors at WC exit, but let’s get back to business. Everything starts with yourself and your own savings. The importance of seed funding was realized by me since childhood so by the age of 20 I had saved up to $3500.
The Next Stop is “Friends, Family and Fools” (FFF)
These guys are those who trust you and trust in you although they don’t have a clue on what your idea is about, and many of them can’t refuse anything as they are tied to you strongly. Our belarusian people aren’t rich at all and at least buying a car is a life success within their value system. But startup investments are a little beyond them, so the only man who believed in my dream strong enough to invest everything in, was looking at me from a mirror reflection.
The Next Stop is “Business Angels”
It has become trendy to call yourself a business angel, so there appeared various communities and get-togethers among them, but I never met a real one within 4 years of fundraising. There are no business angels in the country — not only me was assured of this fact, but also many other startuppers that shared their stories with me. R. Kiyosaki offered a great model of cashflow quadrant:
- Employee — you have a job;
- Self Employee — you own a job;
- Business Owner — you own a system and people work for you;
- Investor — money works for you.
I suppose that there are hardly any investment-minded people in our country, to be frank, I think the quantity is about a zero. Growing up real investors inside one country demands a great factor combination and I had to feel it for myself, as many of so-called “business angels’ still pose as if they are real ones.
The Next Stop is “Venture Capital Investments”
Regardless of all circumstances, several startups such as Viber, Wargaming, Mapsme, Fabby, MSQRD and many other became a real success in our country within the total absence of venture investment ecosystem. After Soviet Union’s breakup businessmen in our country are just Business Owners — (as for R. Kiyosaki) — they aren’t able to take risks. They usually considered the startup as launching a manufacture or trade center, not more than that. They got used to manage everything on their own and possess 50+1% share of the whole company. Some of them were surely ready to invest in our project, but they wanted from 40 to 60% and we were able to share 10–25%. Any higher percentage could kill us, as we would be left with nothing at next stages of investments.
Stop Nowhere — “Collecting Debts”
This particular game is played within each market. Lots of people possessing money can accommodate you with a loan at a definite interest. After failing of fundraising in venture investments, I stopped nowhere. The Team was already working over the project I’d been dreaming of for 8 years. Stopping at this stage was deathlike. I believed we would surely find an investor and decided to borrow some money. This was the last time for me to make such a decision as money tend to run out of and the percents — to be accumulated. The story went to the moment when the money was over and the process stopped. I was an owner of a one more working business and managed to pay all debts within a year, but that experience helped me to make a decision of never loaning anymore in future. Loaning for startup is like a hole in the head.
The Next Stop is “Crowdfunding”
I was clear on that crowdfunding is not a suitable method of fundraising for our project as we were not a hardway and couldn’t make any advantageous production offers to investors. But at the month I ran out of money, I decided to try and we launched a campaign at Indiegogo. The fail was very predictable but the pain was aching a lot. Thanks God a happy occasion happened in my life — I got married and it helped me to catch a break and reboot.
The Next Stop is “IPO”
This method of fundraising is not available for startup for many reasons, but I have to mention it for general understanding and story logic. A traditional method of fundraising is Initial Public Offering — a valuable and complicated form of attracting investments. Only huge companies can run an IPO, and only serious investors can buy their shares.
A Journey of a Thousand Miles Begins with a Single Step: ICO
Through all this time we kept on working over the project. We didn’t rush, but gradually made small improvements. We realized the sea didn’t run high and we didn’t have a wave to jump on. You have to be a surfer: notice and catch a wave, surf up and ride. Back then there appeared some incoming information about mining and cryptoinvestments. I wasn’t about that stuff, I was fully about Rexpax, someone made me an appointment again. I didn’t know what the conversation would be about. During the conversation I heard of blockchain and ICO and began to realize that blockchain technology is prepared specially for our project and we can go for ICO with it! Everything began to spin from then. What’s for ICO?
Subsequent to successful running of crypto projects and enormous increase of coin rates, blockchain technology found it use in other spheres, and investment market was of no exception. New opportunities for experiments broke new grounds for startups. Therefore, new interesting projects found a system in which they could collect the needed funds quickly and effectively.
ICO market is now young and flourishing as well as supersaturated a bit, to be frank. But it is a wonderful opportunity for fundraising for projects in countries, where investments are hard to find. Regardless of your location, you are given a chance to conquer and win, your ideas and potential may have an ability to survive.
Thank you, Satoshi Nakamoto, for starting up a new era and the chance for us to speak about our ideas and Pre-ICO that will start on November 28th, 2017.