IMO, as long as the project is disruptive and feasible, both ICO and IEO are effective in raising funds. No, blockchain technology is no the only way to raise fund, there are other methods out there. So the project developers usually choose the one that is suitable for their business. As far as I remember, ETH raise fund through a mainstream crowd funding platform.
I'll tell you how ICO can raise money. All just give the work product. Build say $ 100,000 and develop a prototype. What would investors know where to invest. And the majority of projects have nothing to do.