Bitcoin Forum

Hello everyone. I would like to know your opinion about start-up companies that create and develop their own product, and at the same time create their own tokens to get some investments. (The question is inspired by the company Neurogress).
The main idea of these is :
1)Get some investments.
2)Offer to people your product.
3)Attract a lot of attention to your development.
4)Make your token "rise in price".
After all, the company has a good product that makes money, "cryptocurrency" that has risen in value, and those guys, who bought tokens on time, will earn a little (or maybe a lot) on this.
Correct me please if i misunderstand the main idea of these company! thanks!

If you issue a token to crowdfund your project and that token have no utility in your project, then you make an unregulated security. And that is against SEC rules in USA. When you are making a security you need to do it under SEC rules. If you dont do it then SEC will not allow it t be on any USA exchange. You noticed what happened to Ripple in last few months. Since it is a security was delisted from all USA exchanges and sooner or latter will be delisted from exchanges in countries where USA have diplomatic influence.

Other than the problem about legalization from local government, from investor point of view you can not offer your token to the investor if you do not have at least a working product or MVP. take a look at neurogress project, the project started in 2017 and already have a few product and MVP.
without a sample, the chance for your project to get funded by the investor is small. in my opinion it should be like this:

1)Develop and have a trial product or MVP
2)Get some investments.
3)Finish the product and offer it to the people.
4)Make your token "rise in price".
5)Develop the project further

You are absolutely right, but I also added the motivation and reason why investors should launch funds into the project and what will be the benefit for them.

So the intention for the creation of the token is to raise money to develop their startup? People will not be interested on such cases they will be looking to make money quicker that is why most people choose cryptocurrencies.But in crypto there is no start up or big company everything can be decentralized that is where the future lies.

The rise in price will only happen if their product is already working or if their issued token is already on the market and listed to different exchanges.

Start up funding isn't good as making token.

They might be sued by the SEC if they'll offer investments in the form of token if they don't comply to the regulations set by SEC about investments.

You made a good analysis to the project. The giving of free token is the reason with making to know about the project.When the price pumped up, you may thing about the project. Surely you made a research of project. They will made set for all.In final, you will again inverse certain part of money into that coin.

That can be considered as 1), since 1) is the main reason why would investor fund their project. without a trial or developed product, there will be no way investor will invest in their project except in some rare case the founder or part of the team have a reputation to back it.
1) is the essence of everything since it is a foundation of their project.

Most of the project started from the scratch and some of them succeed because they have a good concept and that’s why they are earning that much in this market. If you’re looking for a new project to invest with, you must have your good reason before you invest, you study their project, their usage in the market and the possible demand for that new project so by this, it can help you make decisions.

The coin price will only be increase if their plan will be apply, but if this plan will remain in the whitepaper only for sure in the end everything
will be finish into nothing. And it will only be successful if most of their community supporters will embrace the plan they have in the future, then the demand will surely be good in my own opinion.

I know that there are some companies who would do that the way you have described it here, they will first create tokens and seek for investment and after that they have gotten the investments from their investors, they then arrive at the number two point which offering their products to the people, then they go ahead to work on getting attention to their products which will then cause a rise in the price of the coin.

But I wouldn’t say that is a good way to go, the best way to do it is to make use of the strategy that @ DaMut have listed out...

So, @OP, how do you see this one? Isn’t it a much better than the first strategy?
It’s best that the company develops the product first before they go about seeking for investments, because that’s what is going to convince the investors to have their money on it, then after they have gotten the funds they can go ahead to finish the product. This is the best way to do it and approved by the law.

With some of these new projects that are creating their own tokens, I have a feeling that no token is actually needed for their business model. The token is then only created because you can then determine the distribution yourself and reserve, for example, 15% of the total tokens for the team. If the project is successful, the team members are financially secure.

Every coin is good as it usages, so many project died because their failed to have a use case for the token and real life use. But again there are so many good project that one can invest and are good in profits in the long run.

This strategy is much better with Good Long-term planning, Releasing the MVP is the good persentation before getting some investment, even like that developing only a Concept was also good but it's much better to make MVP First. After that some step above can smoothly executed since the startup already the working product and over time it will rise if the product was developed.

It is the job of the investors to set time aside to learn about the various projects they invest in. You don't just wake up in the morning and hurry to invest in a startup with just an idea and no viable project not to mention that they don't have a good plan that would help the project grow. Not just in the price of their company tokens but also an overall project growth. That's the key to surviving in an ever changing investment space like crypto. You have to continously put in research work if you want to ensure that your investments don't go into mediocre projects.

How is this going to be effective?

The company will create their own token, but it's price will be rise after seeing how the token will gonna perform and how investors will treat and trade it.

For a start up company, you should always research on what is in demand on crypto market when it comes to your project goal/objective. It also be advantage if your project has a good product to begin with as investors are more interested on unique products with good use.

Well, I think that most companies do what other companies did in the past. They create tokens and then sell these tokens to investors and market their project on the internet, on the bitcoin forums, and on social media. If they succeed then they have the money but also they now have the responsibility to perform and be able to provide the product and service to the public. These token can be used by the investors or they can also be transferred and sold to others for a profit. It is up to them.

For me, a project that already has a real use case or product even just a beta before they offer it to the community will always be more attractive. This will gain people's trust easier because at least people can see the genuine and seriousness of the developer. A real product will always win against a mere concept. A start-up company that already running previously and already have a product and willing to spread their wings into the crypto world will gain more advantage cause first, they already have the capital to develop their project even if only a prototype and they're brave enough to open to a new world and new audience. The more the merrier.

I agree that it should be unique and when it launched the developers should know how to innovate some developments and their market strategy. Everything should be new because of the high competition in the market. there are lots of the project where they said their project is new and has something new to offer and they are developed well. But when they finally launched their project it will look like this horse in the image.

https://miro.medium.com/max/1198/1*73rZ596sfTQIPRuiSzImdA.jpeg

new companies have to hold lots of interesting events, develop platforms, and maintain market confidence.
many companies only focus on getting investment but forget to perfect and make products that are in demand by the market.
without a quality product, the dream of a new project to survive and get a big investment in the market will not come true.
investors are now more active in analyzing new projects.

I am sure that it will be easy for the companies to do that, but the hardest part is how that token can give real usage to the end-users and benefit them. Many of the projects are not yet reached that stage because, after the token list on some exchanges, the project seems not too serious to continue and reach the next stage. The focus of the project is still on making money from crypto and following the market trend and not giving real usage for their customer, and if that continues, the new project will not grow and it is hard to increase the price.

That's it! that's why this company has attracted attention. Neurogress already has its own product, and it seems very interesting (google it yourself if you need it.) Thank you!

my opinion: if you want to get a lot of money VERY QUICKLY, you need to do something illegal or take very high risks. Most cryptocurrencies are very volatile, or do not grow in price too much (or cost too much) Not much publicized tokens can really skyrocket in price if they are not a dummy

Well, judging by the information on their website, they have been around for quite some time (2017, if I'm not mistaken) and are developing something, I read about their projects, they sound interesting, but I don't know how this is all implemented. Maybe someone tested their development?

Yes, I've heard about that. This even more incentivizes developers to make a really cool product. I think this is a good alternative of giving employees a parts(%) of your company as a reward, I hear this has been popular in the past.

What does "unique" mean to you? Many people prefer to invest in something famous, popular, but not necessarily "unique". They think that this way they risk less, but I think that really unique things should be expensive, for this reason I created this thread.