With estimates that as many as 90% of crypto startups never make it, it’s worth checking out a few simple tips granting your startup a much better chance of taking beyond infancy.
The China Academy of Information and Communications Technology (CAICT) estimate that only 80,000 blockchain projects launched are still active and that startups in the industry only last an average of 1.22 years.
The crypto boom has resulted in many haphazardly launched ventures with dreams of becoming the next “unicorn” but without a clear understanding of the challenges and what it takes to be successful.
The last year and a half since the crypto collapse, wiping as much as $342 billion from the market in a single quarter, has been particularly brutal.
However, by following a few simple tips and doing your due diligence, you can stand a much better chance of taking your startup beyond infancy.
Be Aware of the Most Critical Challenges Crypto Startups Face Today
As easy as it is to get swept up by the excitement and potential of your startup, you always need to do a comprehensive risk analysis before any venture. The crypto market is still a young and tumultuous place, meaning there are even more pitfalls than most industries.
We’ll identify some key challenges throughout this guide and give you some tips to overcome them. However, some of the most highlighted obstacles crypto startups face are:
- Immaturity of the technology and the market: a misunderstanding of the purpose and inner-workings of blockchain and cryptocurrency are big obstacles to broader adoption. It also leads to many operational challenges, such as sourcing more talent as you grow.
- The cryptocurrency crash and current bear market: for many crypto-skeptics, the recent crash served as proof that crypto is just some kind of scam. It has also, understandably, scared off many potential users or investors.
- A super-competitive space: some segments of the crypto market are dominated by big names like Bitcoin, Ethereum, etc. while others are swarming with hundreds of startups. It’s becoming increasingly difficult to get noticed and to differentiate yourself as a result.
Make Content Marketing the Core of your Advertising Strategy
You might, understandably, be wondering what could possibly justify investing the time and money into starting a content marketing campaign for your startup. Advertising in general, and content marketing, in particular, are very underused in the industry for a variety of reasons:
- Founders tend to be technically-minded and marketing isn’t in their frame of reference.
- Margins are tight as a startup, and it seems like a waste to set aside resources for an intensive content marketing campaign.
- Marketing is sometimes seen as a bit of a dirty word and as a way of fooling customers without qualitative results.
That being said, the crypto scene is a veritable pressure cooker at the moment. Startups can easily be crushed in between all their competitors if they aren’t able to effectively and quickly spread awareness. Of course, you’re advertising strategy should consist of more than just content marketing, however, there are some highly convincing reasons why you should consider it:
- It’s a proven and extremely effective method of gaining organic traffic online, especially through search engines.
- Providing a steady stream of relevant and valuable content can position you as an industry authority.
- Creating more content will inevitably build trust through a greater sense of transparency.
Not only can content marketing help you rear your head in the market right now, but it can help you build a stable and loyal community that will see you through the ebbs and flows ahead. If you need more convincing, you can read about why content marketing is such a crucial aspect of your marketing strategy here. If you’re worried about it splitting your focus from your core business, a guest posting service run a campaign for you, even on multiple channels.
Find your Core Use-case and Stick to It
According to many, not focussing on a core problem to solve, is the single biggest challenge for crypto startups. First of all, because there are already so many cryptocurrencies that have already dominated their niches. Secondly, because different people or businesses get into crypto for very different reasons.
There are over 1,600 different cryptocurrencies out there. Distinguishing yourself from the rest is absolutely vital if you’re to make any waves and get ahead.
So, do you want to improve shortcomings in an existing currency? Do you want to solve a specific operational problem using blockchain technology? Or, do you want to do something completely new and groundbreaking?
Make sure that your vision and goals are spelled out crystal clear to remove any doubt in whoever encounters your venture. In many ways, this is the first point you need to get in order before you can move on to the following steps.
Become a Prominent Voice within the Industry
Undoubtedly, an effective marketing strategy will go some way to help you achieve this, especially with frequent contributions from your founders or CEOs. But, there are many other ways that you can establish yourself as a thought-leader and prominent industry figure.
Another side-effect of content marketing might be getting features or guest-posting opportunities on other sites. CoinDesk, Hackernoon, and other blogs are just examples. You could even approach them, but having a portfolio to point to will help your chances of landing it.
Another is to be aware of the most significant events in the crypto industry and to make sure you attend to represent your startup, yourself, and to network. You never know what kind of opportunities chance-encounters can open up, especially in such a young and fast-evolving business.
Keep an Eye on New Regulations and Stay in Compliance
If you know anything about blockchain technology and cryptocurrency, then you know its key tenets are anonymity and decentralized control. Whatever your views are, this has obviously made it a challenging concern for governments to deal with.
Although governments seem to have been slow to respond at first, it quickly did so after Bitcoin’s meteoric rise in 2017. Tighter regulations, or the fear of them, was one of the key factors in its subsequent collapse and the pressure the market is still under.
There is no doubt that how governments regulate crypto going forward is going to have a huge impact on every aspect of the industry and whether it realizes its vision. So, being aware of current regulations and making sure you comply with them as well as being ready to ready to respond to future regulations is going to be critical to your success and staying power.
To 2022, and Beyond
Few industries have seen such incredible growth in recent history as the one created by blockchain technology and cryptocurrency. After all, the total market capitalization capped $830 billion in less than 10 years.
There’s no doubt that this is an exciting space, and the fact that there are over a thousand active cryptocurrencies proves everyone wants a slice. However, the nascency of the technology and the market, the light-speed of developments in the 21st century, and the recent slump also create a unique set of challenges.
Few can argue that it’s a big risk launching a crypto startup in this day and age. However, there are also few areas with such massive promise – and potential payoffs. The least you can do is analyze the risks and opportunities so that you can navigate the maze of what’s ahead.
David Gutierrez started his career as a web designer and founded a creative design agency. Currently, he runs his business and explores the crypto market. He also enjoys sharing his experience in web design, cryptocurrency, and technology. David is an active volunteer at animal shelters where his dog Soul comes from.