Guys, we thought of doing uncapped, but 3 days only for the first phase of the contribution campaign. This is in order to have more network effects among the users and not to have just a few big ones. Let us know what you think. We are here to discuss a nice, pleasant campaign with you.
To quote Daniel Zakrisson, in his article "ICO 2.0 what is the ideal ICO?"
Combining the viewpoints above gives us the following elements for an ideal ICO:
- Scam protection
- Technology check
- Proof of ability to execute
- Business viability check
- Efficient use of funds and business-based thresholds for minimum and maximum raise
- A defined legal framework
- A transparent ICO process
- Escrow
- Controlled release of funds
- Delayed founder liquidity
https://medium.com/iconominet/ico-2-0-what-is-the-ideal-ico-ee9d285a8939As someone who has contributed to a number of projects in this space, this is my 2c:
I agree with Daniel Zakrisson, as I think most investors would, that it's important to set a cap based on what you actually think you need for your business. The absence of a cap raises questions about the venture's credibility. If you're simply willing to "take what you can get" (either too low OR too high), then is shows a lack of due diligence in understanding "business-based" resources required to make the project a success.
If you raise too much, you're diluting the value of the project out the gate, and setting the bar unnecessarily high for the project to gain value. The adage heard often in business holds true here: "under commit and over deliver". If you raise significantly more than other projects in this space, you will be viewed as having made a very large implicit commitment to the community. The bar will be set very high, which is not a good place to be in the early stages of your development.
In the long run, a low/reasonable raise, followed by exceptional execution, is more likely to earn investor trust; this is likely to cause your project to rise in value more quickly, and be worth more in the long run.
I would think the highest appropriate cap would match the max raised in Ethereum's ICO (~$18M USD). Many investors are going to valuate this project against Ethereum anyway due to the similarities of the project and Yani's relationship with Vitalik. I think a more attractive cap for investors, and a safer raise in terms of justification of resources required, would be $7.5M to $10M.
https://en.wikipedia.org/wiki/List_of_highest_funded_crowdfunding_projectsAnother reason I would say a cap is a must now is that (more) VC's (e.g. Blockchain Capital) have very recently begun backing crypto projects. As one of the first projects that I imagine will be both available and attractive to the new VC's, your project is very likely to be over-bought if uncapped, and susceptible to the problems mentioned above.
https://www.wired.com/2017/03/initial-coin-offering-stock-thats-not-stock/Lastly, I don't understand the point of a "Friends, Family and Real Innovators" contribution period, unless there is some way to validate those individuals. If anyone can invest during that period, then it seems to be misnamed, and the question of a cap is as relevant here, as it is to the whole project.
I'm extremely excited about your project, and look forward to April 3rd!
Hey, I asked our founder Yanislav to provide you with a reply, but he is quite busy with the campaign, so I will do it.
First of all, thank you for the reply. We really appreciate your comments and find them quite relevant.
Let me address your points.
We decided to have no volume cap so that anyone willing can participate. We believe that if more people have AE the value of the underlying system will increase. No cap was also Ethereum's approach and that was quite successful.
The name "Friends, Family and Real Innovators" might not be the best choice of words, but this is how we imagine the first people supporting us. I believe Yanislav, being quite sentimental at times, tried to express "closeness" with the first contribution campaign participants.
We definitely see your "over-bought" point. However, organizing a campaign such as this one will always be a balancing act. We are building a public blockchain and we want as many people as possible to use it. This point is further stressed by Yanislav's idea to distribute 1% of AE tokens, created during the backing campaign, to most (technical limits apply) BTC and ETH users by "attaching" ownership to public addresses.
Again, thank you for the comments and thank you for the good words in the end. We appreciate both.
Vlad