Most of team member of ICO was fraud, always intend to scam. Since they have used fake identity, the chances was high to scam people. As a result, people were not motivated to invest in ICO, not even in a legit project because they don't know which one is legit and not.
On the other hand, IEO is being held on exchange platform. The team member procedure the KYC too, the chance of scamming is very lower. On behalf of you, reputed exchange do the research as well.
Investors get attracted, project get fund.
That's the basic different between ICO and IEO.
There are no guarantees that some IEO's won't be scams like some past ICO's but is true that initial Exchange offerings (IEO) can be less of a risk on legit exchanges that require KYC. Do your research about the Exchange that is launching these IEO's before investing. This is why I am bullish on Exchange tokens. I think these Exchange tokens will have more demand as more people enter this industry.