Talk about the pros and cons and how-tos of investing in crypto has been circulating in the business community for some time now, but what happens when business leaders seek to reverse the process? Some entrepreneurs may think about tapping into the crypto community to fund their business ventures through nonfungible tokens or direct investment. Because of their reputation for being more open to new ideas and technologies, crypto insiders may seem like they’d be easier to persuade to help launch a new endeavor. And with the less-established regulatory structure of this young industry, entrepreneurs may hope there will be fewer legal hoops to jump through. 

In reality, crypto enthusiasts are just as concerned with finding genuinely marketable, ethical investment opportunities as anyone else, and the industry does have current and incoming regulations that need to be met. Below, seven members of Cointelegraph Innovation Circle share their advice for business leaders looking into the blockchain and crypto ecosystem for alternative funding.

Ensure you have a viable multi-year plan

Regardless of whether you’re using NFTs as a form of crowdfunding or getting traditional VC backing, all investors want to have faith in the projects they are supporting. Any business (or NFT project) seeking funding should have a realistic, detailed, public three- to five-year plan with a compelling mission and vision. Sharing these, along with immediate next steps post the initial funding, will usually be effective. – Chloe Janicki, Seven20 Entertainment LLC

Reach out to the community where they are

Like any business, it’s important to be in touch with your target audience and speak directly to them. The crypto ecosystem is unique in that the majority of it lives on and communicates almost entirely through Twitter, Discord and Telegram. Speak to the culture of online communities, and these can be your most effective onboarding channels. – Gabe Frank, Arcade

Seek legal counsel prior to launch

Whatever type of token you plan to use for fundraising, make sure you find proper legal counsel who can advise you on your compliance requirements and the rules you will need to be familiar with. This will help you validate or revise your overall strategy. – Herwig Konings, Security Token Group

Make the community a primary part of your plan

Lately, businesses looking for alternative funding have turned to crypto, but they make the mistake of dismissing the community that comes with it. Web3’s strongest attribute is its ability to build a community around a shared vision for the future. So any business leader considering crypto for alternative funding also needs to involve the community as a primary part of the plan. – Warren Paul Anderson, Discreet Labs

Consider what your investors can bring to the table

When you think of tokenization in the context of alternative funding, think first of your most valuable and passionate customers. If you were to bring them in as owners of your business, what value could that unlock for them and for you? Beyond holding a stake in your business, how can they contribute to growing and governing the business? And are you ready for all that entails? – Weiwu Zhang, Smart Token Labs

Be ready to manage a large community with high expectations

Be ready to become 100% transparent, build a strong community and manage it wisely and humbly — and make sure you always underpromise and overdeliver on your plans. Raising funds in crypto can sometimes be easier than raising funds in traditional ways, but it requires the ability to maintain a large pool of investors (your community) and keep them happy and involved. It’s a lot of fun — but it’s not easy. – Tomer Warschauer Nuni, Kryptomon

Come with a long-term vision for growth and innovation

While alternative funding can provide immediate liquidity and the flexibility to expand operations, there are many pitfalls to avoid. No amount of money will buy true innovation, so you must continue to work hard and improve your product/service. Also, crypto moves very fast, and even with generous funding, it could be very easy to burn through your funds without a strategic long-term vision. – Dennis Wohlfarth,

This article was published through Cointelegraph Innovation Circle, a vetted organization of senior executives and experts in the blockchain technology industry who are building the future through the power of connections, collaboration and thought leadership. Opinions expressed do not necessarily reflect those of Cointelegraph.

Learn more about Cointelegraph Innovation Circle and see if you qualify to join.