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ICO Analysis for October 2017

This report continues a series of monthly ICO analysis conducted by Suicide Ventures analytical department. You can have a look at the analysis for September 2017 here.

The report covers 80 ICO’s completed in October 2017; pre-ICO’s are not included.

In our previous report, we used “soft cap” and “hard cap” as our key metrics, for this report we have decided to add a “target” metric.

“Target” is the sum stated by the team as their funding goal, or, the funds that will make the project possible. This differs from hard cap which is the funding goal when the target is not stated, and a technical limit in all cases.

These terms are the key metrics in our report:

  • Soft cap is the minimal amount required by a project.
  • Target is the funding goal as stated by a project’s team.
  • If a target is not stated, then we use hard cap, which is the maximum amount a project is hoping to achieve, or a technical limit of a crowdsale.

A financial snapshot of ICO performance

In October we noticed that fewer projects stated soft cap compared to ICO’s completed in September. Since we were using soft cap as a key metric for success we decided to change the criteria.

An ICO is considered to be a success if all these conditions are met:

  • Soft cap is reached.
  • More than 50% of the target or hard cap is collected.

An ICO is considered to be a failure if at least one of these conditions are met:

  • Soft cap is not reached.
  • Less than 50% of the target or hard cap collected.
  • No information on the project status and funds raised is available, the official website has been deleted and/or the official Bitcointalk thread is cleared.

If soft cap, target and hard cap are not stated, our experts will analyze the project and make sure that the funds raised are sufficient to implement the business. Thus, if a business has collected the necessary funds to implement their roadmap, we deem it a success. If not, it is considered unsuccessful.

Distribution of projects by status [Failure or Success]
Diagram 1. Distribution of projects by status [Failure or Success]
Table 1. Funds raised, USD, *if stated
Total funds raised by all projects*$905M
Total funds raised by successful projects*$658M
Total funds raised by unsuccessful projects*$247M
Median funds raised by successful projects$16.4M
Median funds raised by unsuccessful projects$1.4M

Total amount of funds collected by all the projects is still very high and the ‘rocket growth’ we saw a few months ago is now starting to stabilize. In October $905M was collected vs. $840M in September 2017.
Median funds collected by successful projects was $16M and median funds raised by unsuccessful projects was $1.4M.

The following pie graphs categorize the projects by total earnings.

Distribution of completed projects by funds raised, USD.
Diagram 2. Distribution of completed projects by funds raised, USD.

Have the projects reached their goals?

The following graph analyzes ICO’s with a verified target or hard cap figure.

Distribution of successful projects by funds raised, as a percentage of the target/hard cap.
Diagram 3. Distribution of successful projects by funds raised, as a percentage of the target/hard cap.

Conclusions:

  • ICO’s are still spreading like wildfire, total funds raised in October exceeded those raised in September ($905M in October 2017 vs. $840M in September 2017).
  • A big portion of all the projects fail – according to our criteria, 73% of ICO’s completed in October 2017 were unsuccessful.
  • Out of all projects, the medium funding that was reached of a target or hard cap was 27%.
  • The median amount of funds raised by successful projects was $16.4M.
  • Successful projects most often raised 10-20% and 90-100% of their target/hard cap.
  • More ICO’s tend not to state soft cap. One of the possible reasons for that could be that they wish not to refund if the the soft cap is not reached.
  • 11 out of 80 projects did not state a a funding goal, target or hard cap, but raised $239M (26% of all the funds raised by all the projects).
  • A large portion of all the projects held presales, and in some cases, the amount of funds collected during presale can be compared or even exceed the amount of funds collected during the main crowdsale campaign.
  • For example, Power Ledger collected $13M during presale campaign and the same amount during main crowdsale campaign raising $26M in total. Another project, BlockV collected $20M during presale but only $2M during the main sale.
  • A large portion of the projects also tend to conceal the figures, substituting them with vague definitions like “successful” or “exceeding expectations”. Presumably, they do it to be tamper with token price, soft cap, hard cap, supply or team share. Other teams may also maliciously leverage the market and investors.

Sources: Suicide Ventures, project websites, whitepapers, official Bitcointalk threads.