What is Whitepaper?
A rapidly growing interest in ICOs or Initial Coin Offerings has fueled many startups worldwide to raise funds using this technology. The market has grown vast enough to validate its own rules and regulations that bind all startups who undertake this route. One of the guidelines insists on the creation of a document called the ‘White Paper’. This document serves as the preamble to every project. It outlines the basic idea, mission, the technology used and a detailed description of the ICO. This document plays a crucial role in generating investor interest and converting the interest into investments.
The White Paper details out the system architecture, UI and blockchain technology used. The file also talks about the current market scenario and growth projections in the coming years. In addition , it lists out all the team members, advisors and the investors. Without a well-modeled White Paper, a successful ICO cannot be performed. A poorly written White Paper is a reflection of the lack of experience and technology usage of the part of the founders.
An ideal and compelling ICO White Paper is supposed to answer the following questions:
- What is the main idea behind the project?
- Is the project financially viable and why?
- What issues does the project aim to solve?
- How is it better than the competitors?
- How does it enhance the blockchain community?
- What is the role of ICO project tokens in the model?
- What is the timeline of the entire project?
Read More: How to launch a successful ICO – necessary steps and important tips
Tips on how to write a compelling Initial Coin Offering White Paper that actually sells
An ICO white paper is a document which outlines the technology, uses and risks of a blockchain project. Generally speaking it’s constituted of:
- technical analysis
- marketing material
There is no set formula or pattern to follow while designing a solid and compelling ICO Whitepaper. Each project differs in its approach owing to their uniqueness. But there are some guidelines that form the basis of every good White Paper.
This is the first section of the presentation. It does not contain detailed financial or technical data but simply introduces the idea, the essence behind the project. The general characteristics are also given a rundown. The beginning of a White Paper is where you should place legal disclaimers or any restrictions. Some countries do not allow transactions of tokens and letting the future investors know this beforehand is a good idea. A compelling way to present your idea is in way of an explanation. You can elaborate the problem you wish to solve and why the issue needs to be addressed.
The introduction is where you grab the reader’s attention. This is where you convince the potential investor about the benefits of reading the whole document. Use of visuals and images such as pie charts and graphs go a long way in making the White Paper accessible. A table of contents and an index can help the reader navigate the lengthy document. Lastly, if you have used technical jargon you can also consider adding a glossary.
Often angel investors invest in a project with a bad idea solely due to their faith in the team. The team forms the crux of the whole project. If the team members are well-versed in their areas of expertise and complement each other well, they’re bound to create a valuable product down the line. Several solid ideas have failed in the long run because the team ran out of steam. Therefore, it is crucial that the team be professional and successful. The technicalities of the blockchain domain necessitate the addition of a qualified and talented engineer in the team, without whom the idea can’t be conceptualized.
In this section, introducing the team, their qualifications and passions should be the focus. Convince the investor about the team’s strengths while downplaying the weaknesses.
This is the single most essential part of the White Paper. The section deals with the technical solution your company will provide. Using info graphics and diagrams, the product is illustrated. Start with the overall concept and general principles before moving onto the technical details. Include the prototype data, the first users and development strategy. If the ecosystem already exist , the chances of token survival are more.
An account of all the funds and their usage should also be mentioned. The development roadmap should not be overlooked. A description of the plan for the next 12-18 months should be included. This includes the beta-launch. If the company has already performed a few tasks from the roadmap, it is a huge advantage.
MARKET ANALYSIS AND MONETISATION
Any smart developer needs to be aware of the market he wishes to enter. Research through surveys and interviews can help you identify the current trends of the market. Based on these trends you can chart the avenues you wish to challenge. This also gives the potential investor a chance to make a competitive decision based on the promise of the market.
The monetization plan is a marker for the viability of the project. You should explain the market capitalization you expect, the future token value and further forecasts.
Most experts suggest the usage of professional language albeit with minimal jargon, so as to increase readability. Data, pictorial representations and facts can really spruce up the White Paper. While all important sections ought to be covered, focus should remain on the issue the project plans to solve. The developers should be to ready to field the trickiest of questions. But at the same time, the contents should be available for lawyers, media and the team. inclusion of all these must-haves will surely form a whitepaper that will actually sell your ICO and bring lot many investors.