An ICO or Initial Coin Offering is the same as an Initial Public Offering (IPO), which is the conventional way people made money. An IPO only happens when the company in question wishes to go public and the stocks get traded on the stock exchange.
ICO's happen straight away, in some cases before a business or product has actually been built. An ICO usually involves a Whitepaper, explaining the product and technology, and details of how to send them money, in the form of other cryptocurrencies (BTC, ETH, LTC maybe some others). Finally, how do people get the coin/token that is being offered in the ICO, well once you've sent X amount from your wallet, and assuming it is compatible with that coin/token then you will automatically receive the ICO coin/token when the ICO has ended/soon after. In some cases it is required to download there own proprietary wallet (free) which works in a similar fashion.
There are websites like the following to keep track of ICO's: icoalert.com