ICOs are often big happenings and usually consist of multiple phases:
Pre-sale: The first phase of an ICO is the pre-sale, where a portion of the tokens is privately offered to major and influential investors. The tokens are often offered with big bonuses or discount to gain the support of these early investors.
Public token sale: After the pre-sale has concluded, the public token sale starts. As soon as this sale starts, everybody has a chance to buy the tokens at the predefined ICO price. Buying these tokens is generally very easy and can be done with a single transaction to the ICO smart contract. The smart contract then automatically sends the new tokens to the corresponding address. The amount of tokens one receives depends on the amount of tokens invested and the exchange rate.
Soft cap is reached: All ICOs have a soft cap. The soft cap of an ICO is the minimum amount of funds that needs to get invested in order for the ICO to be a success. If this soft cap is not reached by the end of the ICO, the ICO is deemed unsuccessful and the funds are returned to the investors.
Hard cap is reached: Most ICOs also have a hard cap. The hard cap of an ICO is the maximum amount of funds they are willing to accept. Once this cap is reached the ICO ends. This hard cap is imposed as only a limited amount of tokens can get issued to investors.
Some ICOs are for existing products or by teams that have already proven themselves on previous projects, most ICOs however, present nothing more than a whitepaper. A whitepaper gives a detailed description of the project and is very important for a project.