If you have a new business idea, typically one of the immediate challenges is finding capital to get the business off the ground before it can become cash-flow positive.

Beyond going down the usual route of bank loans (where it is beurocratic and expensive) or the more traditional crowdfunding options like kickstarter (where you only really rely on funders generosity), there were not many options.

That's up until now.

Over the past few years another option has risen to prominence - the initial coin offering (ICO). Following the nomenclature of the established process that private companies use to raise capital through equity listing onto public stock markets (initial public offering or IPO), the ICO is suitable for funding startups. Here, coins that represent a utility or equity value in the proposed product, are distributed to people who contribute funds during the ICO. Funders will benefit from the coin asset appreciating if the project is a success i.e. if its product gains critical mass.

To help to understand this process, Waves Lab - the start-up incubator for projects launching ICOs on the Waves blockchain platform - have produced an excellent step-by-step guide on best practices for the ICO process.

An ICO is a type of crowd-funding that rewards investors with virtual coins that promise to have value if the project succeeds - either through acting as a utility to users or as equity in the project or it's associated assets. Image credits

The guide from Waves lab covers everything from:

• what is an ICO
• benefits & risks
• different token models (utility or equity tokens and their subsets)
• how to determine if blockchain is the right solution for your project
• determining the target audience for your funding
• how to implement the token sale on the Waves platform
• details & advice on the ICO stages
• post ICO distribution & listing
• online PR, marketing, bounty campaigns
• setting up partnerships
• team set-up

...and a lot more. It's worth checking out if you are considering to embark on this type of crowd funding for your project, or if you are simply interested to understand the process.