In my opinion, IEO is not for crypto startups that are seeking funds to kick start their project but for projects that have raised capital already or have rich advisor and team to fund the project. Fund-raising through IEO can be very challenging for startups that need money to kickstart their project, because they will need large amount of money to conduct their tokensale on good exchanges, as this exchanges only list projects that meet their legal requirements and can also afford to pay their listing fees. So the best means to raise money or capital for new projects is to present their proposal to Venture capital firms or Angel investors.
Well you should specify what kind of startup you are talking about, because for the fact that some group of persons want to startup a company don't really mean that they are broke, it is possible that someone have gathered money for many years of their life and now want to focus on creating his/her own platform with the money they have, so don't ever judge any platform because it's a startup, but to some extent you are correct because some startup might not be able to afford the funds for IEO.