Less than half of declared tokensales report reaching goals
In 2017 according to TokenData and FabricVentures report from 913 projects that had tokensale, only 435 (48%) were successful raising $5,6 bln. 131 (14%) didn’t survive this stage 347 (38%) ICOs stayed unreported with no data displayed and even websites disappearing. As a result – low trust to blockchain industry.
In 2018 the hype is over. Less startups assume they need an ICO and industry tends to get realistic. Laws and regulations are emerging, everything tends to come in order to protect investors and give project teams a more powerful foothold for development.
In May 2018 there were 195 ongoing ICOs on ICObazaar planning to close sales. In fact only 91 public sales were closed with $ 2 566 588 843 raised.
The average duration of projects in May 2018 was 42 days. While 51% of ICOs prefer to close token sale within one month, others tend to organize longer sales in several stages.
In May 2018 195 projects planned to close coinsale and only 91 did.
ICO duration increases
In 2017 60% of all projects planned ICO to last less than a month. In 2018 61% of ICOs are planned for 30+ days and divided it into 3+ stages with different discount programs. 10% of ICO last more than 3 month (public sales only).
In 2018 the duration of projects significantly increases. If in 2017 only 39% planned to sale coins for more than a month, in 2018 61,5% act this way. More and more teams initially lay pre-ICO, and then 3 or more stages of sales. In the conditions of substantially increased competition the duration of marketing preparations increases. Also considering examples of extremely successful super long ICO (like EOS) more projects choose to extend ICO.
More projects start with private sale
Nearly 30-35% of tokens with large discount (up to 50%) will go to crypto funds and angel investors. Data shows that 84% of all ICO fundraising this year has come from private and presales.
Pre-ICO allows to check test the product idea, get community feedback and gain awareness and interest without spending money on a full-scale promotion. On a pre-ICO a project can raise $2-3 mln and be ready to go worldwide. Projects use the money to fund pre-ICO campaign including marketing and social media advertising.
Some private sales are extremely successful, and ICO no longer need to go public. Telegram raised $1.7 bln from 175 investors on private sale including Sequoia Capital, Benchmark and Kleiner Perkins, according to Recode. The most recent successful private round belongs to TaTaTu project with $575 mln collected from BlockTower Capital, Carlos Slim’s son, a Bacardi rum heiress, Prince Felix of Luxembourg,investor Allan Cassis’ family and others.
Top-performing private sales:
- TrustToken has raised $20 mln from a series of venture capital funds including Andreessen Horowitz, BlockTower Capital, Danhua Capital and GGV Capital, during its strategic funding round.
- CoinList collected over $9.2mln from some of the finance industry’s most prominent investment firms including Polychain Capital, Digital Currency Group, FBG Capital, Libertus Capital, Blockchain Capital, CoinFund, and Electric Capital.
- KodakCoin has already raised $10M in the presale rounds and it is on track to raise another $175M in its crowd sale.
- Zichain has postponed its initial coin offering (ICO) due to high demand from institutional investors which saw it surpass its soft cap target of US$3mln in the token pre-sale.
Number of projects decrease but the amount of funds raised increases.
According to ICObazaar stats it seems like there were fewer projects but it may be caused by the fact that in 2017 listing was not a must-do in an ICO marketing plan. In 2018 there are a lot more ICO listed and funds raised:
Coindesk reports both ICO number and funds raised increase:
Source: public.tableau.com, coindesk.com
|Project||Total Raised, $|
|Telegram ICO (Pre-sale 1 & 2)||1700000000.0|
|Petro (Private Pre-Sale)||735000000.0|
|Orbs (Private Sale)||118000000.0|
In Part 1 we give data on the main trends of ICO process: duration increases and more funds are coming from private and pre-sales. Part 2 is an overview of emerging fundraising methods, marketing and legal aspects. Stay updated on our blogposts to learn more!