link to previous article on importance of Social Media Presence for being eligible to participate in an ICO - https://steemit.com/steemit/@cryptobanyan/ico-investment-series-5-having-a-social-media-presence
Each topic that I touch upon can be very detailed and complex. Where possible I give links that help give deeper details. I refrain from any deep discussions because of 2 simple reasons - 1. I am not authority on these topics, but more importantly 2. I want to cover a broader perspective of ICO investments and any deep discussion will take us away from our goal.

Stages of ICO investment

Before you start jumping in registering and going through he process of buying into an ICO, there are many things and many steps to follow. That is what this whole series is about. The first things to consider is at what stage of the investment are you really registering. The remainder of this article explains the stages of ICO investments.

Maybe I should I have written this before #4 where I detail out the steps to register for an ICO. Hopefully you are reading all the articles in the series before actually making an investment already and therefore this article is still better late than never.

ICOs will offer their coins / tokens in a series of investment rounds. I try to list some that I have come across

• Seed funding - This is a stage you may never enter, unless you are already an investment firm and if you, you would not even be reading this series in the first place. You are already a virtuoso with a lot of money to invest in startups of your choice.

  • At this stage the those providing funds don't just do it for coins / tokens. They expect and are paid in equity.
  • ICOs use this seed money to help create initial website, marketing, MVP, outline their strategy for holding a crowdsale, iron out the legalities etc.
  • Many startups are self funded by the cofounders to ensure non-dilution of equity.

• Private Sale or Private PreSale - Only large investors are allows into this stage. Minimum investment can run from USD 1000 (or 1 ETH) to USD 100,000 (or 100 ETH). Since ETH is not always equal to USD 1000 (these days it is lingering around USD 700) the ETH amount may vary or the startup may not be particular of USD and just define minimum in ETH or NEO or ADA (depending on the blockchain they are launching their token.

  • ICOs these days are getting nearly over in private sale itself. If you have money get into Private sale (most money is made by investors of this stage) just take your truckload or ETH or NEO or whatever other coin is needed and send an email to the startup that you want to get into private sale.

• Public Presale - This is the beginning of the crowdsale. Most bonuses are given in this stage for the crowdsale. The good ICOs are offering very little bonuses in this stage, but it is still a reason to join in this stage as the good ICOs are done with in Presale itself. There is nothing left for public sale or final crowdsale. So get in early. Many ICOs have minimum entry requirements for this stage as well (normally between 1 ETH and 10 ETH).

• Public sale or public crowdsale - This normally is the last stage of getting into an ICO. The bonuses will be declining or not there at all. Get into this stage only if you believe in the long term story of the startups application. Since this is not an investment into equity, even if the startup is stellar, you will have no access to their future projects which may succeed if this one fails. You only have access to a particular application of the startup, and not their future ventures. Also since there will be a lot of dumping going on soon after ICO, you will have difficulty existing the investment in the early stages of the exchange. If you are in a bear market like the current one, then things are even tough as investment will be hugely negative for a long time to come.

• Prolonged or staged crowdsale - Some ICOs stage their crowdsale. The reason for staging is varied from ensuring that they achieve some goals before they come asking for more money (very frugal and good thought), to reaching a wide audience (which normally takes time), to achieving a very high hardtop (the worst of all reasons for investors). The few ICOs where I invested were having staged crowdsale (and at that time had no idea what staged crowdsale really meant from investment perspective) and these have either not yet seen their light of the day on the exchanges for my money to convert to something meaningful or the investors have no appetite for them on the exchanges as these were so long drawn that anyone who wanted them got them during crowdsale (with months and months long crowdsale there is no fear of missing out, so everyone can go and get the coins / tokens whenever they plan to). In short I have lost heavily on such ICOs and on exchanges the value is less than 50%. They may blame it on bear market, but now I realise that their token metrics were worst and they only achieved their hardcap due to months and months long crowdsale. I would just shy away from such ICOs unless there is a reason for long term investment. Please note that I am not saying that the ideas behind these ICOs are not worth investment. All I am saying is that get these on the exchanges if possible unless you have a strong reason to invest at ICO stage. As you guessed by now, I am not a fan of these staged crowd sales, but you must make your own informed judgement on such ICOs for investment.

One word of caution. Startups (the right ones) are getting so much interest, that they are expecting to know how you will help them grow and what contributions you will make to help the project succeed and ecosystem grow, rather than just pump and dump the coins for quick profit. They will assess your engagement level and ability to contribute to their project and future business growth and only then let you enter into their Private or Presale rounds. Also there may be a lockup period (again to avoid pump and dump by large investors, but with some sweetener of higher bonuses). Therefore get into private sale and Presale knowing enough about project, your ability to contribute and long term vision you may have for the startup (as most probable your tokens will be locked for a while and you can't sell them on exchanges like others who buy in crowd sales).

• I have stated only min requirements for investment. Due to heavy interest many ICOs also have a maximum cap. Some ethically driven ICOs also have a maximum cap to ensure the average investor gets a chance to register in the ICO. Normally I have seen the maximum, anywhere from 10 ETH to 100 ETH. The lower this is, the better for you.

Important Note - Many new ICOs are conducting crowdsale investments in a different manner like using DIACO or some dutch auction process of some variant of these or something altogether new. The stages of investment will be different from what I have explained above . Though the startups will claim that the new processes are investor friendly, especially for small investors, please do understand the new processes introduced by them carefully. For example there is one new ICO where getting in early may just make you pay a high price for the ICO and you may never recoup the investment in a short timeframe and getting in late may not leave you any coins or tokens to buy. Sometimes it may just be best that you buy the coins / tokens on the exchanges instead of in a crowdsale. Please tread carefully and only do what you completely understand, otherwise it is nothing short of gambling (since investment itself is a gamble, you don’t want to do anything that multiplies your risk to a higher degree - gamble*gamble).

Disclaimer - I am only sharing my limited knowledge and for the sake of knowledge alone. This is in no way an investment advice or legal or taxation counsel. I am not qualified to provide any of these. This is also not a recommendation or encouragement to invest in cryptocurrencies or ICOs