 So in this video, I'm going to be talking about the pros and cons of an ICO, initial coin offering. If you saw my last video, which I'll link below, I was talking about, is there too much greed in the cryptocurrency space? And I think there is right now too much greed. There's both pros and cons that come with that greed. However, in this video, I'm going to be looking at main features of what's beneficial of an ICO and the main features of what is not beneficial as the cons of an ICO. I'm not going to go into detail, explain what an ICO is. You know what it is? It's a token offering. Let me just turn off this phone. Okay, so I'm going to try to make it short as possible for you. Let's start off with the pros. There's some key beneficial reasons why ICOs are quite beneficial for the ecosystem, beneficial for startups, and beneficial for people around the world. Number one is low hanging fruit opportunity. Things keep on falling down. So low hanging fruit opportunity. If you come from the startup world, raising capital, getting a touch from investors, whether that is angel investors, VC investors is very difficult. First of all, very select few people have access to these individuals that have money. And second of all, even the people that do have access to these individuals for you to actually be able to get funding from those individuals is slim to none. So now what ICOs present, they present the opportunity for anybody regardless of their skin color, regardless of their religion. And what's really important, regardless of geographical location, you know, you don't have to be in Silicon Valley, you don't have to be in Israel, you don't have to be in China, regardless of your geographical location, you have now the opportunity to raise capital. Yes, there's a lot of cons that come with that. I will, I'll get to that in a second. But in my eyes, that's a huge pro. And I think obviously we're going to have cycles of let's say, trial where we see a lot of scammers coming in, where then we eventually kind of filter out through the process. And eventually, maybe a couple of years later, we have a roadmap, an actual process, a blueprint of how to actually successfully do an ICO and validate an ICO. So the opportunity that bear to entry is more democratized and commoditized for people around the world. Number two, speed and paperwork. So the number one enemy for any startup is speed. Speed is against you or time is against you. If you don't have enough momentum, well, guess what? You die away. If you don't have enough users, well, you die away. Okay, so speed in this sense is on your side. So for an ICO, pretty much all of these days, what it takes is a white paper, even though I don't agree with that mythology, I believe you should have more than a white paper, you should have a demo product, you should have a working alpha, at least an alpha product, and showing your community before you do an ICO as opposed to just a white paper. Second one is paperwork. So if you haven't, if you haven't raised capital yourself in the past, the actual legal paperwork for setting up your corporation, setting up your holdings account, setting up your term sheet for raising, let's say you have your pitch deck and you go to different investors. So setting all that up is A, very expensive. So, you know, let's say a North American, something like that may cost you an average $15,000 or so, and B, the actual process of getting say, even if investors say yes, the actual process of the investors reading it over and signing it is quite lengthy. But there's huge benefits for having all that, you need it regardless. But the actual paperwork is a huge hindrance, I would say, and a lot of let's say startups, like let's say you're a startup in Africa, and you have this beautiful idea, you may not have the, let's say, opportunity or the resources or the connections or, you know, just based on where you are, the circumstances of cards you're dealt with, you don't have, you don't have any of this stuff. Speed is against you and paperwork is against you and access to the accessed individuals to do that for you is against you. Okay. Number three, and this is a big one when it comes into cryptocurrency spaces, community building. So what the ICO is, people are building a community before they actually have a product, which this pros and cons to it, which I'll get to in a second, I've kind of lined everything up between, as you can see over here, is a community. So for example, people now have incentive if they invest in your crypto and your token, they're now supposedly right theoretically incentivize now to let's say promote and to encourage the growth of let's say that new token ecosystem. And finally, like I mentioned, this ties into number one is capital. It is really, really difficult for most people to raise money from angel investors. You're lucky if you get angel investors and even harder with venture capitalists. So now the access to capital has been democratized and commoditized, but on both sides because now before, if you wanted to raise money, pretty much you went to angels and you went to VCs for money, but now anyone can invest. You can have, you know, people around the world investing in your project. It's more like an open source commoditized democratized variation investing where, hey, if you want to take the risk and you understand the risk that you're taking, you can invest in this project. So those are the pros right now. And obviously the pros are going to evolve through trial and error, through ecosystem evolution. And we will, like I said at the beginning of this video, eventually come to a consensus of what we deem as best practices when it comes to initial coin offerings. So let's get to the cons. Okay, let me move this over here. There you go. Okay, cons. Number one, there's a shit ton of scammers in this space. I mean, a shit ton. And like any space, there's a lot of scammers in all different spaces. However, specifically this space, because like I said, capital is easy to get. So you got to watch out for this. There's a lot of scammers making bogus claims, drawing up a white paper, it looks good on paper, right? You see it from the outside, nice website, advisory board. Here's a little tip. Anytime I see a startup that has, let's say, multiple advisory boards, multiple people who are supporting their project, I always second guess that I'm like, why do they, why do you need all these fancy names on your website in the first place? I want to know who the founders are. I don't know if they have what it takes because I'm investing money in human being cap in human capital, not the actual technology. So that's kind of, I always second guess that. So there's a lot of scammers. You got to watch out for this. Anytime there's easy money and anything, the scammers will come out of the woodwork and suck up all the money. Okay. Number two, speculators. So with these ICOs, they're raising money on this conceptualized idea of a product they want to create in the future. So the actual value of that company is only value through speculators. Now there is a need for speculators. However, the issue right now is I find it, let's say troublesome where companies are raising north of 10 million, even a million, say $10 million on an idea. And now this idea for the most part, if you look at statistics with regular startups, 90% of our ideas will not exist. They will not come fruition. It's not possible to create due to many different variables. And these speculators, it's a little bit different in the cryptocurrency space because these speculators can make or break the value of your token within your protocol. And this is something to take into consideration for anybody who is considering an ICO in the future. It's like, oh, you have a nice, you have a token now, you know, you raise some money, but due to speculators and then betting on your token, your token can go up and down as you see any single day within a crypto sphere. So this is something where there's both a little bit benefit to it, but there's a lot of negativity or a negative aspect when it comes to speculators on an idea that has no validity. It's a different story if you IPO, you had a product, you have revenue, and you have sustenance there. It's an actual business model. But when you have speculation on a fucking idea, then you have big problems. Wales, a lot of people don't take this consideration, especially for people new in the spaces. Wales manipulate the space. You have huge whales in China, you have these cartels, people come together, and they will come in with bots and scripts and out gas you. So they will literally pay more money in transaction fees to get ahead of you in line to buy all the tokens in this ICO. And therefore it goes back up to number two when it comes to speculators. Now they control the tokenization. They can speculate when they want. They can put sell orders on exchanges. They can buy their own sell orders so that they can manipulate the price through to psychology because people see someone selling it. So therefore the price might drop, etc. And whales are manipulating everything. So now you have an ICO, you have this great idea, and you have these whales own X amount of tokens. And you won't know the whales own your token because they're not going on one address. They may go on multitude of different addresses and they'll out gas you, like I said, you know, pay way more transaction fees, and then they're going to spread everything out and you won't even know. You won't know who these whales are. Okay, so they can make or break you, which is not good. It's really not good when it comes to thinking, how can I create a sustainable company? Next, organization. So it's great that blockchains such as like, you know, Bitcoin, Ethereum is decentralized parties around the world. It doesn't matter where you are working on it. But for initial, and I would say those are the exception to the rule. And they're always, they're always going to be exceptions to the rule. But if I, if I'm looking at actual history of startups that are successful, you know, there's key things to take consideration. Leadership, the core team involved, the nucleus of, let's say the organization. And, you know, I'm kind of irksome when it comes to an organization that doesn't have a true leadership that's spread throughout the world, that doesn't understand how to create a proper sustainable organization that runs as a strong startup. So that's something I've taken consideration to is like, where are the founders? Where are they located? Is there nucleus of the team located there? And if it's not, I kind of second guess that thing. So, you know, even though like I said, it's very interesting with this, it's not new, you know, you look at Linux and everything. But I don't see this as a benefit for having an open source team, not technology, but an open source human capital team around the world for a beginning of a startup. It can definitely, of course it works, after has momentum, after has revenue, after has profit, and you actually have a sustainable business, then you can decentralize your teams all around the world. But from the get go, that's iffy. Next, timing. So a lot of these ICOs, I don't think so, the timing is right, tell you the truth. And they have altruistic goals, which is nothing wrong with that. However, there is, and goes to reality, there is what you want, and then there's reality. And for the most part, most of these ICOs, they are decades ahead of the curve. And you see this in standard technology business, you saw this during the dot com boom and bust, where you had a maze, like for example, Amazon, that wasn't revolutionary that existed before. All these businesses that we see today, whether it's Ubers, whether it's Airbnb, whether it's Amazon, whether it's whatever online, some form of that type of business pre-existed them. It's timing of the marketplace as the most important thing. And timing is very hard to, let's say, calculate, extremely hard to calculate. And timing also corresponds to geography as well, because timing here in North America may work, but timing, let's say in Germany or China may not work. So the geography of your business and the market that you're actually marketing that to geographically does play a role in that timing. And finally, which ties into time is reality. The reality is 99% of these ICOs will fail. That is the cold reality, the cold facts of this space. And I don't know if it's maybe willful blindness, one of the cognitive biases, but I find it irksome, where a lot of these individuals are just going in without actually thinking about reality, without doing something like what I like to call without without doing the gedunka experiment. So I love this experiment. A gedunka experiment is an experiment of dissecting a theory, dissecting an idea and going through it in every aspect possible and looking at it from every frame possible. So both you can play the advocate and the devil's advocate at the exact same time. So most people, they rush into it and they have these blinders on like horse blinders and we call it a willful blindness, one of the 25 cognitive biases. And they don't have, maybe they have 20 yes men's around there, but I always recommend people do a gedunka experiment, break down your stuff, get all your, let's say, devil's advocates in your life, your enemies or people who think this won't work and ask them why. Tell them to write it down and look at it from different angles. And that way you can filter your process, your thought process of this idea before you even write a white paper. I think every stage of a business should go through a gedunka experiment where you filter ideas literally from different minds of, because everybody has a different view of the world, a different view of business, a different view of marketing, a different view of economics, a different view of human nature, etc. So that's it. Those are the cons, those are the pros. They will, they'll have ebbs and flows of going up, changing and rearranging. But the bottom line is a genie is out of the bottle, Pandora's box has been opened. ICOs are here to stay, whether it's called ICOs today or token, whatever, token thing tomorrow, I don't know. But it's amazing. You cannot stop technology, technology is evolving, which I love. And I look forward to the future of what new technology comes and how this platform or this opportunity evolves. Alright guys, if you enjoyed this video, leave a comment below this video. If you want me to do videos of anything else, and I'll talk to you guys soon. Peace.