In many respects, blockchain and crypto projects are just like any other startup.

They all need to raise funds. They also need to assemble the right teams of developers, product managers, finance, marketing, and more. And they all have to promote their project and seek out their tribe – the loyal base of early adopters who’ll help them get their product in front of bigger audiences.

However, there’s one glaring difference between crypto projects and the average startup – the presence of a token.

Funding in cryptocurrency has been through several iterations, starting with the hedonistic days of the initial coin offering (ICO,) which faded into the more respectable initial exchange offering (IEO) and eventually evolved into the initial DEX offering (IDO.)

Now, there’s also a tendency for projects to release tokens in private sales to investors and VC firms. But in the end, there’s invariably a token.

And it has proven itself to be a powerful tool for fundraising and user acquisition.

With the token, crypto entrepreneurs have raised millions, tens of millions, or even billions. In some cases, they’ve had nothing more than a white paper and a marketable vision.

While it may seem like an easy ride, free of obligations, the reality of token fundraising is quite different.

How the Token Takeover Happens

The biggest issue, that we’ve seen happen time and time again, is that the token can take over. Here’s how it plays out.

The crypto entrepreneur launches his visionary project based on a blockchain ecosystem centered around a utility token. The general idea is that the utility token will ultimately fulfill its purpose once its blockchain ecosystem has been developed and launched on the mainnet.

n the meantime, the entrepreneur successfully convinces investors that once the token’s utility comes into its own, there will be such demand for it from the community of users, it will have its own market value thanks to the competing forces of supply and demand.

Once the initial flush of investor enthusiasm wears off, the entrepreneur is now expected to deliver on their project roadmap.

But there’s a problem.

Without that initial flush drawing in a steady supply of traders, token liquidity starts to dry up. The price begins to fall. The token holders become anxious. They start to accuse the project of failing to deliver, or worse, being a scam.

What to do? Perhaps an exchange listing? Or a trading contest? Or a new staking program? What will help the token price recover and restore investor faith in the project?

Do you see what just happened there?

The project is no longer about the value in the entrepreneur’s vision or future product. It’s become about the token price.

The entrepreneur isn’t any longer spending their time developing an industry-changing or cutting-edge blockchain project – they’re devising token marketing schemes and engaging in crisis management on Twitter and Telegram.

Of course, there’s nothing wrong with getting a token listing. It can help drive exposure to more token buyers or even perhaps users. But the cons outweigh the pros.

The entrepreneur has compromised their ability to deliver on their roadmap and they’re now wasting precious time and budget on gimmicks designed to appease the markets. Ultimately, they’re sacrificing the success of the project at the altar of the token price.

The token has taken over.

So how can crypto entrepreneurs avoid this trap?

Tokens Aren’t Products and Products Aren’t Tokens

Instead of chasing prices and attempting to keep up a continuous chatter of news and green charts, crypto project founders should understand that in the way that matters most, they are like any other entrepreneur.

The main differentiator that will provide the best chance of long-term success is their product. And building a great product with an enthusiastic base of users (not traders) isn’t a quick win.

But founders can get there if they focus on their Github, not their Twitter feed.

As an agency, we prefer collaborating with hard-working projects that are here for the marathon, not the sprint. Narratives take time to shape and hone and even more time to embed and spread.

We know from experience that crypto journalists are hungry for stories about tech progress and achievements, but yet another token listing or trading contest isn’t likely to grab their attention.

So based on our years of experience helping crypto projects achieve success, we’ve identified the formula as follows.

• Remove token price from your radar and let your investors know your priority is delivering on your roadmap.
• Focus on writing quality code, not pithy tweets.
• Build your product, your brand, and your team.

Eventually, when you deliver what you’ve promised, people will recognize the value of your achievement.

What’s more, by that point, you’ll have something worth many times more than the speculative market value of your token. After all, people value the UNI token because Uniswap is one of the best, leading-edge DEXs. People value ETH because Ethereum is supporting apps transacting billions of dollars per day.

Those people who are only there for the token price? They’ll always find another hot project to move on to. But you’ll have a working platform, a growing user base, happy investors, a proud team – the definition of entrepreneurial success.