Before we can reap the benefits of a seamless ICO, it’s good to know where to start. Tons of blog posts, articles, and guides make ICO development sound easy. But a very big question looms: How much will my ICO development cost?
We in the blockchain community have big dreams about all the money we can make after our ICO takes off. Big ideas make the challenge worthwhile.
However, several key features go into ICO development which will increase your ICO costs. Whitepapers, a website, smart contracts, and security, as I’ll mention, have to be impeccable before you launch. Marketing and legal services also factor in. Each item adds complexity — and dollars — to your ICO costs. Getting it right means the difference between successful ICO development and a money pit.
Let’s start with the whitepaper. Most companies are able to write their own internally, but some outsource it or seek help with parts of it. This could cost anywhere between $1,000 and $20,000. But why is there such a discrepancy?
A bright shiny ICO whitepaper contains all the relevant content for an ICO. Technical information, marketing materials, and a detailed business plan all help partners and investors understand the core product.
If you’re looking for a simple review and final touches, a blockchain-savvy marketing agency can usually do it for cheap. However, if you need them to write one from scratch, you’re looking at 150-200 hours to create (and revise) one. Be ready to shell out between $15,000 and $20,000 for the project.
In addition to a seamless whitepaper, a sleek ICO website broadcasts your message to the world. An engaging, responsive site goes a long way to attract partners and investors. Surely if you go worldwide with your ICO, additional languages are necessary, not to mention cybersecurity. Looking case-by-case we can estimate that the website alone (design, building the landing page, inputting ICO statistics, registration forms, whitelisting and status checkups) falls between $5,000 and $12,000 initially, but adding security components and different language versions of it can reach upwards of $20,000.
Crowdsale smart contract
Creating the token and crowdsale smart contracts — the technical heart of your ICO — will cost another $10,000 to $20,000 depending on the technology and complexity. Don’t skimp on this part! It’s the core of your money-making machine so it’s better to do it well than to be sorry after something breaks down.
During the estimation phase, you should be aware of all the mechanisms inside the smart contract so make sure your tech provider is open with you about it. Because after it’s ready, it’s time to double check if everything works as it should.
Once your team has designed all the inner mechanisms and functionalities of your ICO, it’s time for ICO development. Where this can get costly depends on the complexity of the smart contract. Don’t forget about management — every smart contract works in a particular blockchain, which has its own cost. Different blockchain technologies have different costs, some of them are easier to use, faster in calibration and deployment of the smart contract, some of them are much more complex. This doesn’t mean they’re good or bad, just that it depends on the unique solution you offer.
As simple as it might sound, after hours of work you need to spend even more precious and costly time on testing, both automatically and manually, because there is no room for error. When it’s done the audit is next. Remember that the more processes involved in your smart contract, the higher your ICO costs will be.
Once a team designs and codes a smart contract, it’s ready to audit. Once again, the complexity of your smart contract factors into the estimate. It can range from $10,000 to $40,000. Finding objective auditing experts with different points of view is essential. Auditing code and functionality of the smart contract is one aspect, but security is another. Factoring in a security audit for your ICO costs substantially more. But it’s worth it to get it right the first time.
Marketing your ICO costs anywhere between $20,000 and $100,000 or more. Though investing here improves your visibility and establishes your image as a major player. Add community management to that and expect to shell out another $10,000 to $50,000. Monthly maintained advertising can run $20,000 to $30,000 but it’s truly unlimited if it comes to the “maximum” you can spend on it. If you see a clear opportunity in your ICO, invest. But remember — more does not automatically mean better. It’s good to have a clear marketing plan and a trusted advisor by your side to establish a reasonable ICO budget.
Legal services can cost $10,000 to $100,000, depending on the region and local laws. Sometimes much legal attention isn’t required, and sometimes your ICO may need robust legal protection. A good lawyer is like a good umbrella — he protects you from bad weather. Costs may vary – some big firms will give you a $100,000 bill only because they’re big – if you’re willing to pay it. Hiring well-known legal minds, however, can be an advantage in your ICO development since it adds legitimacy to your project.
Costs of ICO development
To summarize, the cost of ICO development with bare-bones features starts at around $40,000. Adding options such as banking services that accept cryptocurrency and can be connected with your ICO adds about $10,000. Boosting security and adding know-your-customer guidelines might add another $40,000-$60,000.
High-end features with robust legal and marketing budgets can reach upwards of $500,000 or more. This, of course, depends on the level of service and how much you can do yourself. As in all projects, it’s easy to build expenses and a lot harder to reduce them. Good advice from blockchain experts is key to give you a good idea about your ICO budget. Sometimes it’s better to pay for expert consultants at the start, to gain as much information as possible than to sink millions in the project.
For more information about estimates and blockchain consultancy – go HERE
Understanding why my ICO costs so much
Of course, this is an average estimate, and it can vary case by case. To get a proper estimate you have to create a roadmap, cut your whitepaper into stages, and set goals. Of course, the complexity of the smart contract is something very hard to establish at first, that’s why consultancy is so essential early on. The more you know and understand at the start, the cheaper it will be.
Gaining a better understanding of why your ICO costs so much can help guide a discussion and negotiations with your tech provider. On the other hand, he can offer you something way cheaper than you expected. What then? Think about how crucial and important that part of ICO development is. Ask your advisor, research your tech provider diligently. As in real life, you get what you pay for.
Once again, knowledge is power. Gather it and use it well. Thankfully, we have some great resources. Here’s an ICO in-depth guide and infographic (click on the image):