ICO? I run a software startup, and we're profitable, with traction and customers

[gurglegratipay]

Hi all, I'm the founder of a software startup, for which I'll remain ambiguous for the moment, understandably as we decide how best to move forward.

My team and I are programmers, been coding for years, the works, and we have built a product, and some underlying proprietary tech that sees some significant customers. We are 100% bootstrapped, and profitable. Our product is in the sales automation space, B2B.

I have been intrigued by ICOs and it's decentralized means of fund-raising, as is compared to venture capital, and I have a few questions for you:

1. We have a ready product, ready customers, ready company (been in operation for close to 3 years), proven team, and revenue (and profit) generating, is an ICO good for us? (Compared to many ICOs I see which are ideas-only)

2. How should the token be used, in your opinion? Token as service credits, or a token for equity?

3. If it's token for equity, how can I cap my own valuation? I'm in this for the long haul, and an artificially sky-high valuation will make things hard for us in the future.

4. If it's token for service token, it's kinda useless, no? Since fiat will do the same.

5. Lastly, will you be interested in an ICO for a software startup in our space? (not closely related to blockchain/eth)

[brekyrself]

Questions 1-4 should be determined by your current share holder(s) and accountant(s).

Question 5.  ICO's always gain some attention, it's how you attach your real world product with a blockchain that will determine the excitement.


You are at a similar point many of us are, how to attach our current business models with a blockchain to further our enterprises...  I would suggest reading some white papers on platforms that can provide "User Issued Assets" to see ideas beyond what you mention, service credits, equity etc...  Read http://docs.bitshares.eu/_downloads/bitshares-financial-platform.pdf and you can see OpenLedger.info as a reference of a business built upon a blockchain.

[ttookk]

If you look at past ICOs, they usually had multiple purposes at the same time:

- Distribution of tokens to the community

- Price discovery

- Funding of further development/reimbursing the dev team


Furthermore, most, if not all legit ICOs (yeah, I know, "there are no legit ICOs" and all that crap…) are projects in which the existence of tokens is an integral part of their utility. Having an ICO, creating tokens and trying to subsequently add value to these tokens defeats the core idea of an ICO, really. I realize that there are a lot of projects going that route, even though on a technical level, there is no need for them to issue their own tokens and this worries me.

What you COULD do, although I don't know/see how this would work with your specific product, would be tokens as vouchers: users can buy them during an "ICO"/crowdsale and use them to purchase stuff from your company. How this would be beneficial for you or the buyers, I don't know. the only advantages I see would be that those vouchers would be tradable between users and you wouldn't need to set up a voucher management system, since it would be managed by ethereum, or whatever token platform you decide to use.
If you go that route, I wouldn't call it an ICO, though.