Evaluating Cryptoasset Project Teams
Understanding What They Bring to the Table to Make Your Investment A Success
Five components of team evaluation:
- Track record of historical achievements
- Distinctive Combination of Skills
- Unique Qualifications for Tackling the Problem
- Experience Building Distributed Systems
- Transparent and consistent ethical behavior
For a project to succeed its founding team needs a variety of skills and their background needs to be evaluated.
What have they achieved historically?
What unique skills do they possess to drive the value of the cryptoasset forward down the road?
Barren LinkedIn profiles and difficulty tracking down the project team’s background are a red flag to be examined further. In some cases, anonymity may be justified. There should clear reasoning as to why it is necessary from the project team if that is the case.
Distinctive Combination of Skills
In the best of worlds, a cryptoasset project team has a distinctive combination of skills including:
- Respected engineers
- Designers with startup experience
- Marketers with a demonstrated track record of running successful campaigns
- A Leadership team that has managed successful projects in the past
People with these qualifications don’t grow on trees though. Another question to ask is can the team access these skillsets when needed. If a strong community surrounds the project. They’ll have a better chance of engaging talent needed to solve problems as they arise even if the talent isn’t directly employed by the project.
Unique Qualifications for Tackling the Problem
Team members should have relevant life experiences related to the problem they are trying to tackle. If a project team focused on international remittances only includes developers from developed markets who have never needed to send cross-border payments to relatives. Technically they may be up to the challenge, I’d be skeptical they have a deep enough understanding of the intended user base to develop the right solution for them.
Versus,
An expat engineer who has been sending money home to relatives for years experiencing the challenges and price gouging first-hand international money transfers are known for.
Experience Building Distributed Systems
When reviewing the LinkedIn profiles of project leads. Keep an eye out for distributed systems expertise. It’s an advantageous skillset for successfully pushing out decentralized projects and is generally in low supply. Project teams that have it are at a distinct advantage versus ones that don’t even if they otherwise possess great technical acumen.
Transparent and consistent ethical behavior
Finally, teams need to behave ethically and transparently. While the situation is improving, the potential for bad behavior still exists requiring teams to be vetted accordingly.
Consistent blog updates with high informational content are a must. Since transparency is optional. Projects need to demonstrate transparent behaviors as there is no requirement to do so.
Personally, I love bad news. The crypto space is so new every project is going to hit stumbling blocks. Projects acknowledging these bumps and communicating the lessons learned from them are teams to keep an eye on.
Active social profiles with verified identities is another plus. People routinely discussing their project publicly are much less likely to abscond with investor funds given the ease of tracking them down.
If any concerns remain as you approach the end of your evaluation. Don’t hesitate to do a deeper dive into their background.
FullContact offers a free gmail extension that can help track down more detailed background info.
Messari is another good resource for due diligence on project teams because their profiles include links to LinkedIn, Twitter, Github, etc… so you don’t need track this information down yourself.
Resources
• Messari
Steve Miller
Stay up to date on his research by subscribing to his newsletter.
The CFA designation is globally recognized and attests to a charterholder’s success in a rigorous and comprehensive study program in the field of investment management and research analysis.
CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.