During the Ethereum Community Conference (EthCC) held in Paris, distinguished venture capitalists (VCs) offered valuable insights into effective strategies for achieving startup success in the dynamic and rapidly evolving crypto market.
Ryan Barney, an investor at Pantera Capital, emphasized the importance for startups to prioritize selling to exclusive clientele or whales/VIPs instead of focusing on rapid scaling in the early stages. He cited the Blur airdrop as an exemplary case of how a thoughtfully designed airdrop can significantly enhance traction and visibility.
Barney also pointed out that both initial coin offerings (ICOs) and influencer marketing have encountered challenges in recent times. Regulatory complexities have hindered institutional participation in ICOs, while influencer marketing has faced issues related to non-disclosure of conflicts of interest and follower manipulation.
On the other hand, Tony Cheng from Foresight Ventures expressed a different viewpoint, asserting that influencer marketing plays a crucial role in the crypto industry due to restrictions on paid marketing through platforms like Google and Facebook for crypto companies. He underscored the significance of key opinion leaders (KOLs) in attracting users to crypto platforms through social media channels.
Cheng further warned against reckless influencer marketing and advised projects to align with KOLs and ensure their messages resonate with their user base. He also noted the recent regulatory ruling in SEC v. Ripple, suggesting that founders should consider non-institutional token sales or ICOs to gain traction, as they were deemed legitimate when sold to retail investors.
Cheng went on to advise caution in using ICOs until further regulatory clarity is established. He suggested that the favourable ruling on retail sales could be applied to various fundraising mechanisms similar to ICOs, potentially making ICOs the primary means of fundraising in the future.
Vitalik Buterin, the co-founder of Ethereum, joined the conversation at the EthCC and shed light on Ethereum’s account abstraction history and the latest proposal for non-custodial wallets.
Aave meanwhile announced the launch of Lens Protocol V2, an upgrade to its web3 product. It will feature “open actions” to connect on-chain elements to social content, fostering a decentralised social networking ecosystem.
In conclusion, the valuable insights shared at EthCC provide essential lessons for startups seeking success in the competitive and ever-evolving crypto industry. The importance of targeted marketing, leveraging key opinion leaders (KOLs), and ensuring meticulous adherence to regulatory compliance were highlighted as key factors in navigating this dynamic landscape successfully.