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.
This is the reason why many startups still opted for ICO for small investors, even though investors find ICO a not good environment for investment, I have known a lot of projects that go for IEO after their ICO, this is to generate more funding in their ventures and to get listed right away.
Getting a chance to get more investors and make sure that the project will be listed factors that investors like from the projects, from both ends they
will try to get benefits, additional funds for the team to make sure that they will be able to continue while for investors making sure that the token can be traded after the IEO period has been done.