There is no shortage of people releasing “whitepapers” for ICO’s that they are planning to launch. One of the most common questions many people ask is “Can you review my whitepaper?” The problem with this is that most people today should not be asking if someone will review their whitepaper before they first ask the question “What is a whitepaper?”
A whitepaper is, in essence, a technical description of the theory you are presenting or the product you are developing. It should explain what the product is, how it works, and what technological underpinnings it is built upon.
What many startups release today and call a whitepaper is realistically no more than a business plan or, even more likely, a pitch deck. There has been a shift towards creating a sharp graphical presentation with minimal evidence that a team can perform what they are promising. This is a dangerous practice and many investors view these kinds of “whitepapers” as a red flag.
What Belongs in a Whitepaper
A whitepaper should contain technical descriptions of what is being proposed or built. The classic example that should be reviewed by those writing their own whitepaper is Satoshi Nakamoto’s bitcoin whitepaper. See the example below of one section:
The above description of the simplified payment verification provides insight into how this process works and is accompanied by a diagram that visualizes the concept. This type of information, along with introductions to the industry and the purpose of the proposed product, is essential to writing a good whitepaper. It is also important to cite any sources used in research. This validates where the concept is derived from.
What Doesn’t Belong in a Whitepaper
Where many go wrong with whitepapers is by adding in information that does not need to be there and oftentimes excluding the pertinent information that explains their project. What a large number of ICO’s in 2017 and early 2018 released as “whitepapers” were made to function as a pitch deck. Look at this excerpt from an example Uber pitch deck:
This above image represents a brief industry analysis. This kind of information, along with some well-branded charts, are extremely common in whitepapers today. While it is important to provide insight into the industry and the solution you are providing, charts like these belong more in a pitch deck or broken down into more detail in business plans. Pitch decks are meant to sell others on the value of the product or service. They are not meant to replace technical descriptions.
It is important for companies that want to release a whitepaper to sit down and consider what they are building, how it is being built, what target market they are focusing on, and every other question that businesses have been asking for years. The key here is properly dividing this information into appropriate documents. Topics such as business strategies, marketing plans, executive summaries, timelines, and financial descriptions belong in well-developed business plans. The marketing discoveries made such as target market, unique selling proposition, brand/positioning strategies, and competitor analysis should be used in creating a pitch deck to present to interested individuals and organizations.
Writing a whitepaper shouldn’t be a scary process. It should, however, demand attention to detail and careful consideration of what information is present and how it is being presented. Completing a proper whitepaper is, after all, the foundation of the product you are offering.