Ico enables every individual and every company to easily release freely tradable tokens to raise funds.It could be used to completely reconstruct the financial system of shares,securities and so on.It decentralized not just money,but stock creation and trade.
I think investing in existing coins is really risky, imagine investing in coins that have not come out and few people know.
ICO is basically a kickstarter or fundraiser for a new coin project. There are scams, but there are still many official ICOs out there.