An ICO Adviser's Ponderings on How to Recognize a Scam Team

ICO adviser and specialist in marketing and PR in the crypto industry Andrey Sergeenkov published in his blog a guide on the selection of ICOs under the title “9 Keys for the Evaluation of the ICO Project Team.” In his opinion, the team is one of the main parameters when choosing an investment object. “Investor risks are not only that the project may be fraudulent, but also that it can never be implemented or become popular, and the acquired tokens will be useless garbage. Even if you like everything else, but you have big doubts about the team, I would not advise investing in such a project,” Sergeenkov writes.

There are two main questions. The first is whether the team members actually exist and if they are qualified enough to achieve their goals. For a reliable answer, a full investigation is required, and Sergeenkov gives 9 “inroads” that bring the potential investor closer to the right decision.

1. Find Team Members on the Social Media

On the project site in the “team” section next to each representative, there should be links to their accounts on various social networks, from which LinkedIn is the most preferable. “Look at their pages, read posts, check the number of friends and subscribers, personal photos, and information about the career. Does the profile look real?”

2. Look for Team Member Photos on Google

The next step is to upload personal photos of team members and run Google’s image search. Fraudulent projects that are appropriated by other people usually take images from Google Images and photobanks. “Identity theft” has already become a popular scam trend. In January, attention was drawn to the Fantasy Market ICO site for adults, which promised investors the role of “filmmakers” of porn films, and the platform token was to be used to pay for the work of the actors. After the site was not launched, and a person having no connection to the project was accused of fraud, it turned out that the organizers considered it “too dangerous to use real names” and invented the CEO “Jonathan Lucas,” borrowing from a random person a name and a photo for LinkedIn and even inventing a story for him. Recently, Ryan Gosling “became the face” of the Miroskii crypto project, which posted a photo of the Hollywood actor among the team members and introduced him as “graphic designer Kevin Belanger.”

3. Contact the Team Directly

Sergeenkov does not recommend using formal discussions on Bitcointalk or the project’s Telegram channel on issues related to the ICO. “On these platforms, community communication managers tend to give more or less standard, pre-prepared, and very vague answers. It is better to contact a team member who is responsible for certain tasks. So you will get more detailed answers and at the same time make sure the person is real.” Also, Sergeenkov advises to, at least very briefly, but directly talk with the company’s management as this will help dissolve doubts and misunderstandings.

4. Pay Attention to the Size of the Team

The ICO expert recommends “extreme prudence” when investing in projects that “collect tens and hundreds of millions while their team consists of five people with two or three executives and a pair of technical specialists.” Small teams can turn out to be decent and efficient, but only for startups with a small budget. With respect to major projects, Sergeenkov is sure “Even if these people are extremely talented and their idea is brilliant, they will not be able to create a viable and successful project. They need a lot of employees, including market specialists, PR managers, designers, lawyers, accountants, community communication managers, project managers, and so on.”

5. Is Communication Well Established within the Project?

It is necessary to pay attention to how the team members communicate with one another and where they are physically located. “The more team members work in the same city or office, the higher the chances of success during and after the ICO,” says Sergeenkov. Otherwise, the probability of poorly coordinated work increases, since if one member of the team does not know what the other is doing, this will lead to strategic errors and loss of money. Despite modern means of communication, large companies tend to accumulate unfulfilled tasks and unresolved issues that are difficult to settle remotely.

6. Does the Team Have Experts in Specific Areas?

For a startup of a specific topic, it is critically important to have a specialist who understands this area, be it an oceanologist in a deepwater exploration project or a trader in a startup aiming to create a crypto exchange. “Each field has its own risks, and if the team is not aware of them, the project may face unforeseen obstacles and eventually fail.”

7. Do Not Pay Too Much Attention to the Advisers

As Sergeenkov writes, himself being an ICO adviser, in most cases, such specialists are paid only for posting information about their participation on the project’s website, and the amount of compensation depends on their “significance and arrogance, from thousands of dollars to hundreds of thousands plus a share of the profit.” As he said, the advisers usually do not take part in the project, and their “help” is limited to the fact that they permit to use their photo among other team members. In addition, more and more advisers forge their experience, in order to “sell” ICO project more profitably. There are only rare exceptions when some experienced specialists involved in the project can really contribute to its promotion.

8. Experience in the Crypto Industry

Project management, technical experts, and marketers should have proven experience in the crypto field. “The rules of this industry are significantly different and even the professionals recognized on the traditional market need time to get used to them,” the expert notes.

9. An International Team Is a Good Sign

Sergeenkov draws attention to the fact that many new projects are being created in Eastern Europe, Asia, and Africa, whose residents do not always speak good English and this can make international communication difficult. “It is important for such projects to have native English speakers in their team. Mostly, this is necessary for marketing specialists, community communication managers, PR specialists, and employees responsible for communicating with investors.”

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