How to deal with post-investment management issues of projects?

Source: Daoshuo Blockchain

A reader left a message asking the following question:

When an investor invests in a project, some aspects of the project’s development are unsatisfactory. Did not develop according to my ideal focus. What to do when faced with this situation? If you want to give up and it feels inappropriate, how should you weigh and grasp this measure?

This problem will have different results when considered from different time dimensions and different stages.

Based on the current market conditions, we will use the current period as an entry point to think about this issue, that is, how do we think about this issue during the transition from a bear market to a bull market---this is what readers are continuing. Be sure to pay attention to the major premise when reading the following content.

Let’s go back to the problem itself, and we can further subdivide this problem into three small problems. These three small questions cover the complete cycle that we need to consider when investing in a project: the three stages of pre-investment, mid-investment and post-investment.

These three questions can be summarized as follows:

1. As investors, when we first invested in this project, were our assumptions about it reasonable?

2. When the development of the project is not as good as our expectations, is there a problem with the development of the project or with our understanding?

3. What should we do when there are real problems with the development of the project?

Let’s look at the first small problem first.

If investors make serious mistakes in their assumptions and expectations about the project before investing in it, the subsequent results will not be good.

At this step, investors usually easily fall into two extremes:

Either they have too high expectations for the project, or they have very low expectations for the project (or they do not expect the project at all) Can have very far-reaching scenes and spaces).

If investors have too high expectations for a project, the problem they often encounter in the future is that they are particularly prone to pessimism: Why do other projects keep doing well and prices keep rising? There is no movement at all on my project, and the price is as calm as a stablecoin, and it even keeps falling.

There is a very typical case in the current market: the boring ape.

We frankly say that the Ethereum avatar NFT project headed by Boring Ape has not developed smoothly in this bear market and the current transition from bear market to bull market---the vast majority of investors are not optimistic about it. Its expectations were too high.

In the past few years, the series of games and scenes launched by Boring Ape obviously failed to meet the goals of the project team and the expectations of the community.

On the other hand, if investors have too low expectations for the project, they will easily encounter the problem of regretting that they sold the project too early and got it at a very low price. of chips, and watched helplessly as the bigger bonus passed by in front of his eyes.

A typical case in this regard is the leader of BRC-20: ORDI.

I remember seeing an on-chain data a while ago that showed that most of the earliest investors who participated in ORDI have cashed out and left the market. Most of them have not received more than 50 from the beginning. USD price.

I myself will fall into these two extremes. Therefore, my approach to this problem is as follows:

For projects that have experienced the bull-bear cycle, because it There was a peak in the last bull market, which was a potential ceiling. Therefore, I will take this ceiling as an expectation and evaluate whether the project still has the potential to reach the peak of the previous bull market before investing. After investing, you will pay attention to the risks of the project and be ready to leave the market at any time if there is a greater risk.

This is a conservative style.

For projects that have never experienced a complete bull-bear cycle, I will look at the good aspects of the project before investing; I will also pay attention to the risks of the project after investing. However, as long as there are no fundamental problems with the project, I tend to ignore fluctuations and hold until the bull market.

This is a more radical style.