Since blockchain became a hot topic, entrepreneurs have devised several mechanisms to raise funds via crypto token sales. What started as Initial Coin Offering has evolved through several stages – Security Token Offering, Initial Exchange offering, Initial Dex Offering, Initial Farm Offering, etc. And another popular fundraising method on the list is IGO, a.k.a Initial Game Offering. It is a fundraising mechanism for game projects.
In IGOs, game developers or startups who don’t have enough funds to kickstart their gaming projects gather funds by selling their in-game assets and crypto tokens to investors or gamers before launching the game in the market. In short, IGOs merge the gaming sector with a crowdfunding platform enough to raise funds for game developers and early access to gamers.
- How are IGOs transforming the gaming industry?
- How does an IGO work?
- How do you participate in IGO?
- Benefits of IGO
- How to launch your gaming project as an IGO?
- Popular Initial Game Offering launchpads
How are IGOs transforming the gaming industry?
The gaming industry is already on cloud nine, as now is the perfect time for creators and game developers to give life to their innovations. The blockchain game industry is developing rapidly, and IGOs are here to benefit developers and gamers. It is difficult for gaming projects to be launched on centralized exchanges like Binance or Gate.io because they are either new or in development. The IGO platforms stand out to meet the demand. Like IDO in its early days, IGO plays an important role in accelerating the blockchain-based gaming industry. The rise of Initial Game Offerings will further establish the gaming market, eventually bringing liquidity to the overall ecosystem.
A major attraction factor about IGOs is that they are open to all investors. A gaming startup no longer has to convince venture capitalists or directly approach a small group of high-worth individuals for funding. Instead, it can directly reach its audience through an IGO. If successful, they can secure financial support to complete the game project.
How does an IGO work?
IGOs are similar to ICOs and are used for raising capital for new game projects where the Initial Game Offerings participants can gain early access to in-game assets and benefits in the game’s early stage of development. The participants can also receive the tokens designed for the game ahead of its public release.
IGO campaigns are usually hosted on crowdfunding platforms like Kickstarter or Trustswap and can be held by game studios directly through their websites. Interested investors should show they have enough crypto in their wallets to participate. Once approved, they can buy the game tokens on the day of the offering, and they need to be locked with a pool before it is used.
The most common in-game tokens include weapons, characters, mystery boxes, skins, etc. These in-game assets are in the form of NFTs that are required to play the game once it is launched. For example, the assets offered during an IGO range from characters to skins, weapons, accessories, and mystery boxes. These assets are made live on the blockchain as NFTs, whereas some are offered through the IGOs required to play the game.
How do you participate in IGO?
IGO participation increases public awareness about cryptocurrencies and can increase demand as Initial Game Offerings usually offer bonuses for buying tokens early on. The upcoming IGO projects are usually found on IGO launchpads, and every launchpad has its respective process for accepting potential investors and new projects.
There are usually two phases in the gaming project. Phase 1 projects consist of projects that are in the initial stage of development and require funds. Phase 2 has projects that have already raised considerable capital, but they won’t mind reputed investors’ backing. Investing in the early phase, such as Phase 1 projects, come cheaper but has its share of risks, and if your focus is on already popular games, phase 2 projects can be your call.
After demonstrating your eligibility and having the required crypto in your wallet, you’ll be ready to participate and buy tokens during the upcoming IGO. But here is the catch you should only initiate IGO participation after complete research as they lack regulation by government authorities. Investing in IGOs is risky, and there won’t be any consumer protection against fraud and scams. Therefore, before investing in IGOs, make sure to do thorough research and also follow the below-mentioned steps:
- Please research the Initial Game Offering platforms and the previous games launched on them.
- IGOs often use a lottery mechanism to provide allocation, so you need to check whether the Initial Game Offers launchpad provides guaranteed allocation.
- A launchpad with a good history of successful projects will likely provide major returns on most of its upcoming projects; therefore, we should evaluate the ROI of the active IGOs on the platform.
- The IGOs may prove more beneficial if the tokens are launched on a popular launchpad so that token valuation can be higher and more revenue can be generated. Therefore, the launchpad’s holder value should be evaluated based on its performance metric.
- You need to check the number of token generation events of an IGO launchpad, as a higher number of events implies that the platform strives to host quality initiatives to boost the overall valuation.
- Be responsible and ensure your money and investment, as IGO/ICO/IEO/IDO are high-risk investments.
- Compare the Market Cap and FDV (Fully-Diluted Value) of IGO platforms’ tokens that require staking to participate in the IGOs so that proper planning can be done before the investment.
Participation in IGO should be only done after calculating future profits to avoid financial loss. Risk is always involved when investing in a project before knowing its end result. If the game turns out well, the investors can earn huge profits, or it will lead to a loss of money.
Benefits of IGO
IGO offers extensive benefits for game developers and investors looking for growth opportunities in game development and profit-making. The major benefits are as follows.
- IGOs help with the development of innovative projects in the gaming sector.
- IGOs help you to maintain 100 percent ownership of the company’s equity, which means the publishers might want to own a segment of the company for their investments, and the developers are forced to forfeit some ownership of their business. However, IGOs don’t push developers to such conditions.
- Unlike traditional investing, IGOs offer the game developers to raise money without relying solely on venture capitalists and publishers, i.e., instead of focusing only on big names or big corporate investors, an IGO offers a channel to get quick funding within a short time.
- IGOs are a fast funding process that reduces the shortage of funds for project development.
How to launch your gaming project as an IGO?
Launching an IGO is similar to launching an ICO; however, IGOs are specifically launched for the gaming industry. The early investors receive valuable in-game assets as tokens at a less price before it is made public in the auction. The explosive growth of the blockchain gaming industry has fueled the popularity of Initial Game Offerings. Here is a comprehensive checklist to help you launch your successful IGO.
Brainstorm your project idea that requires IGO funding: Prepare the documentation demonstrating your game development objectives and methodologies to meet users’ expectations. For that, you need to understand the game market and the target audience thoroughly. This will give you an overview of the activities to be planned for the upcoming steps.
Research the legal side of things: Learn about the current cryptocurrency regulations and the changes that can occur in the future. You must follow all the relevant rules and regulations and be completely transparent about handling people’s money. Spending, taxes, fiat withdrawals, and other project financial aspects must be clear and communicated transparently.
Create an IGO token: Create your game token and decide in advance how many tokens will be issued in total and the number of tokens sold during each token sale stage. Creating the token is a fairly simple process; however, customization of the crowd sale logic of your tokens can take some work. If you are not tech-savvy, think about hiring a specialist to accomplish that for you.
Whitepaper Creation: A whitepaper is a technical document that details every aspect of your gaming project. It includes every detail from market research, project vision, development strategy, design, goals, early investors and advisers, and so on. The gaming enthusiasts in the blockchain space are getting more tech-savvy daily. So you are required to be extra careful while drafting the whitepaper.
Launch the website: The website should contain the project’s roadmap with all the realistic, achievable goals and set timeframes. A breakdown of the costs should be outlined in the roadmap, and all the information regarding the token distribution should be easily accessible to your future investors. Some of the necessary features to have a good IGO layout is as outlined below:
- Layout: The website’s content should be of single page structure as it offers a very convenient and easily accessible way of presenting all the necessary information.
- Security: Invest in a good reliable hosting service that can prevent your website from crashing, phishing, and hacking attacks
- Design: The website should reflect the project’s nature with a reliable, slick, and professional outlook. Any mistake in the formatting may repel the investors.
PR and Marketing: After all these steps, now is the time to promote your IGO campaign. Allocate a substantial amount to marketing to boost your project’s social networks. Clearly define where your project stands within the current market. People will only invest in your project if there is powerful hype around your game and when they believe that they will miss out on an amazing opportunity if they are not into it.
Launch your project: After going through the necessary steps, you can launch your IGO project. You can launch your project on your website, but a better way to do it would be to list it in an IGO launchpad. You can utilize some of the popular IGO launchpads given below.
Popular Initial Game Offering launchpads
Launchpads are platforms for launching new projects, and you can find the upcoming Initial Game Offerings. These platforms can be on blockchains such as Ethereum, BSC, Cardano, etc. Some launchpads will have games and other projects, while others will focus purely on games. They have different conditions for accepting new projects and potential buyers participating in an IGO. There are many different launchpads and below are a few examples.
Enjinstarter
Enjinstarter gaming launchpad focuses on the Enjin ecosystem and metaverse, allowing it to raise capital and build a blockchain community. It also helps in value-added benefits like gasless transactions, smart contract support, and carbon-negative NFTs.The platform also supports projects in creating sustainable strategies and launching successful campaigns.
Game Fi
GameFi is one of the top-rated IGO launchpads that offers blockchain games and metaverse projects. GameFi’s solutions cover the entire game project’s lifecycle.GameFi has four investment tiers, and only one tier has guaranteed allocation to its IGOs. GameFi gives one lottery ticket for every 20 GAFI tokens, the minimum requirement to participate in the funding.
Trust Pad
Trust Pad is known as the safest multichain launchpad that focuses on gaming and uses DeFi instruments to help organizations raise funds from early-stage investors. Trust Pad has nine tiers that combine lotteries, guaranteed allocations, and weighted entries. To participate in it, the investors need a minimum of 3,000 Trust Pad (TPAD) tokens.
Seedify Fund
Seedify, apart from fundraising, also helps in community building and marketing for blockchain projects. It is a bootstrapped community-led ecosphere with 50+ successful launches and 4500+ participants per IGO. It also has a balanced 9-tier system for IDO/IGO allocations.
Conclusion
Blockchain-based crypto games have tremendous growth potential; therefore, investments through Initial Game Offerings are the need of the hour. However, like any other investment decision, it should be wise and well-calculated before plunging into it. Providing early access to gaming assets is the main purpose behind offering IGOs so that the investors can bank on and expect a significant return on investment and profit margin in the future. Truth be told, there is always a certain amount of risk involved in every investment; but be smart to curate your strategy to enjoy your game and fill up your pockets.
