As an investor, i cannot participate in IEO conducted by small and new exchanges. The main reason why IEOs are preferred to ICOs is because they are more prone to scam than ICOs, and this is because the exchange validates its legality with their reputation. Imagine Binance or any top exchange conducting a scam project, it will jeopardize their integrity, and these exchanges do not want their integrity in question, so they only offer legit and promising projects IEO. New exchanges do not have the reputation to validate a project, they are just after the profit, SO they might promote a scam project either intentionally or unintentionally.
You are right to an extent though but I tend to see it from different angles; what the exchange which is promoting the IEO does is to verify the team but what happens afterwards isn't in their control thus not deciding if the project will do well on the long run. On the other hand, in order to be careful of not participating in a scam IEO it's better done on prominent exchanges which will try their best to ensure their integrity isn't questioned; and so far, IEOs on major exchanges have proven to be a success.
