You don't right. There are projects that have developed (already) products but they need funds to speed up marketing.
Indeed. Most funds collected in ICO's tends to go toward marketing and exchange listings (which are pretty expensive).
Unfortunately, still, many ICOs are the scam. What is worse - it has become extremely difficult to find out which of them is a scammer. I am trying to work with the cryptocurrencies not to be a loser - it is better than these scam projects.