Marketing your blockchain project in a post-hype world

Is the blockchain and crypto hype really over? Let’s dive right in and take a good look at the cold, hard numbers and see what’s what.

There’s a range of metrics we can look at to try and understand what’s happening with the blockchain-project investment market. But, for the time being at least, let’s take a look at the amount of money raised, on average, per project.

If we look at this average, there’s still a pretty convincing uptrend here, even with all the “brace yourselves, the crypto winter is coming” talk flying around lately. That said, many projects are flying off the shelves, others are, well, frozen before they even got off the line.

Yes, the amounts invested are going up, so it should still be relatively easy to raise money through for your blockchain project right? Yet many projects seem to be struggling.

Here we need to take into the account that the competition has also gone up, dramatically. The statistics above also do not count the number of failed ICOs in the total.

Stats vary widely depending on the source, but the numbers, on face value at least, are a little sobering: according to ICOBench there were a total of 5135 ICO-funded, blockchain-based projects, with approximately 20% of those reaching their soft cap by the end of December 2018.

Coming up with that 20% figure requires a bit of educated guesswork though, because there’s no hard data on who has raised what.

According to Coinschedule, 1072 were funded successfully, Coindesk has this number as 650 and ICOBench 2293. The truth is probably somewhere in the middle. This means that under 20% of projects that listed themselves as fundraising through an ICO managed to reach their soft cap.

So, after doing a little bit of maths, suddenly it all doesn’t seem so easy anymore, does it?

With the end of 2018 the market saw a veritable crypto-bloodbath, with prices declining over 80% from the highs of 2017.

In this sense, the talk of crypto funds freezing their assets and crypto investors getting cold feet seems inevitable. There is also a big shift in who invests. As institutional investors have moved in, it is no longer easy to raise money just off a white paper and a viral video.

This, we believe, is a good thing.

So, as the market is starting to mature, the game has changed, quite significantly. As we kick off 2019, here’s what you need to focus on to help secure funding for your blockchain-based project.

I mean, really, REALLY think it through.

Is your idea really solving a problem?

What is the competition? (and OMFG, if I hear another person tell me that their project has “no competition” I am going to scream)

What is the total addressable market?

Who is your customer?  

Why do you need blockchain for this?

Is the name you’ve chosen offensive or superstitious in some cultures?

Why a token?

Why not a token?

What is the background of your marketing guy/girl?

Has anyone from the team got skeletons in the closet?

What is your unique selling point?

For certain these questions will come up, best come prepared.

I mean, really, REALLY think it through.

Is your idea really solving a problem?

What is the competition? (and OMFG, if I hear another person tell me that their project has “no competition” I am going to scream)

What is the total addressable market?

Who is your customer?  

Why do you need blockchain for this?

Is the name you’ve chosen offensive or superstitious in some cultures?

Why a token?

Why not a token?

What is the background of your marketing guy/girl?

Has anyone from the team got skeletons in the closet?

What is your unique selling point?

For certain these questions will come up, best come prepared.

Make sure your tech is up to par. If you can go live or build an MVP first, do that. The market is no longer interested in investing money into just a mere idea. If you are not the technical mastermind yourself, find the best talent or partner with someone.

I am not suggesting overcomplicate things or add AI on top of a stack of blockchains in augmented reality, however whatever you are building has to make sense. If there is no expertise behind it, they’ll start smelling BS.

What is your revenue model?

What is your burn rate?

When will you break even?

What is the cost of acquisition per customer?

When will you make a profit?

Make sure that you calculate everything and try oversee any potential costs and revenue streams.

Put a lot of time and effort into your financial plan. Building a shiny and impressive pitch deck will go straight down the drain if your numbers don’t work out.

One big mistake that I’ve seen even super-smart people make is thinking that they will start marketing once the product is ready. Or once they have secured an investment or you know… “when the time is right”.

The problem with this is from both sides.

Let’s say you’ve built the best product in the world. It goes live, you expect explosive, organic growth. Yet nothing happens.

But why?

You may have the best thing in the world but if no one has heard of it, it is not likely to sell.

Many projects take a stance of starting marketing once they have raised funds from investors. This is also a chicken and egg situation.

Investors are not likely to part with their money if no one else has heard of you.

How can they trust that once you have the money for a full on marketing blast you’ll know what to do with it?

What to do when you don’t have a million to spend on marketing? There are many cost effective strategies you can use. Things like SEO and cold outreach to press and influencers may do the trick for you.

The key here is to find channels that work best and give you the best results and then focus on only these few channels, particularly if you’re working with a small team. Don’t try and do everything, everywhere. Pick a a couple of channels, and f***ing own them.

It will take longer with a low budget but it is by no means impossible.

The worst course of action is doing nothing.

Seems like a no-brainer really.

Build the best team.

This is one of the most important areas investors look at; people buy people, not products.

In the startup world money of course is scarce.

It is not a great idea to hire people on price.

It is better to go for a smaller more experienced team rather than hiring interns or semi-qualified people and hoping they’ll deliver if you tell them what to do.

Hire people to tell you what the best course of action and trust them to do that.

Ask yourself “how much money do I need to do this?”.

It is easy to get blinded by the crypto cash cow. When you see that projects that raise hundreds of millions, or even billions. A unicorn before the product even exists, sounds great right?

But have a think, a really good think whether your company can actually live up to the promise. Of course it is easy to overvalue your company, because to you it is the greatest thing ever. But will the investors see it that way?

On the flipside, asking for too little may also not be the best move.

Is it plausible that you will go to market and survive until you start making money with the amount you are asking for?

I have seen potentially great projects seeking to raise $100k. Firstly, how do you possibly build tech, pay salaries and market the project with a total of $100k?

There are of course some great examples of bootstrapped projects that have made it to unicorn status. For most of them, sadly, the story goes that the money runs out before you can get to market.

And if the ticket size is too small, investors may want to pass.

As I already mentioned above, people buy people. Instead of trying to desperately find investors or other business partners you need and telling them about your earth shattering idea, find people you connect with.

People who like you as a person are going to be more likely to invest into or go to business with you. That is also more beneficial to you and your company: to find people that you like and respect.

It is less likely to be a beautiful success story if you don’t trust or have a mutual understanding with your investors.

To safeguard and get your business thriving, find your people.

The sea of blockchain projects is overflowing with buzzwords. How many times have you heard pitches going something like:

“We are going to bring transparency and decentralisation into the industry. This will completely disrupt the space and bring democracy to all through blockchain technology and highest level of encryption with the help of smart contracts that interact autonomously on a synchronized ledger without a central authority that will make everyone rich overnight through this miraculous and unique ERC-20 token with lazers…”

Don’t be that guy (or girl)…

Go back to the basics; forget the buzzwords and say what you actually do.

Blockchain is a very hot topic still of course, however most don’t understand how it works. The beauty is they don’t have to. When pitching an e-commerce solution, most probably do not go to the details of how Amazon S3 works. When sending an email, I doubt anyone takes a moment to think about POP3 and SMTP.

Of course, there will be situations where investors want to take a deep dive into the technical specifics, but keep that separate from your main marketing conversations.

Stop trying to blind people with science.

Stop saying “blockchain”.

Tell your story.