How does ICO make money?

As a curious observer of the cryptocurrency landscape, I'm intrigued by the mechanics of how Initial Coin Offerings (ICOs) generate revenue. Could you elaborate on the key processes involved? Specifically, I'm interested in understanding how a project raises funds through an ICO, how the funds are allocated, and ultimately, how does the project utilize these funds to generate profits that would justify the investment made by participants? Is there a revenue-sharing model or are profits derived solely from the appreciation of the token's value? Clarifying these aspects would greatly assist in grasping the financial viability of ICOs.