DAO Debt: Do we need a social consensus?

I think you need the tools to tag a proposal as one of these and when the funding is available, it can be redeemed within the bucket according to the above percentages. The waiting-list aspect will be self-governing, though ugly and painful at first (like now).

This would be very nice, but I can’t see it happening immediately and until then a social consensus will help us. We can still limit debt and the problems that creates and look for funding, pain doesn’t necessarily always mean an instant solution. The statis caused by constantly being in debt and all funds leaving at the start of the month could cause damage.

In the Genesis Weekly Call we spoke about -20/30 ETH/DAI being an alright level - @Luuk, @adam @Eylon @orishim please chime in here with your thoughts

For me personally, I think it is difficult to make this upfront categories how the funding has to be spend. When I see how it is divided now, I believe at this moment research is needed in many areas, in order to create useful tech. For me 10% seems a bit low. However, I also do not really know what is meant by ‘product’. Maybe this can be clarified a bit?
One other thing that pop ups to me is other points of view that can help DAOs grow. For example, when I think about our own endeavour in the legal field, in which category would that fit? To create a legal overview will be beneficial to all three categories, but does not really fit in one specifically?
Many questions :sweat_smile: thanks for starting the thread, I think it is very valuable to discuss it.

really ? when you want to spend more than what you have on your monthly income you say - hey let’s get wild and spend more, it will incentivise me to increase you income ?

There is a minimal responsibility of any organization, whether it will be a corporate, household or a DAO, to priorotize spending based on limited resource.

So even when the DAO treasury and monthly income increase , it is a basic need. and in my view if Genesis (or any Eco system development DAO for the sake of this discussion) doesn’t adopt such practice, the chances of this use case to be wildly adopted is low

Yes. By design. You spend all your allowance before you get it and the whole thing gets clogged up from a “flow” point of view and you have to stop. It’s a beautiful lesson. It forces discipline, naturally.

Well – in all honesty, yes. Borrowing money for college incentivized me to get a salary, moving into a more expensive apartment in NYC incentivized me to demand a raise (which I received) … truthfully every time I’ve gone into debt I’ve tried to take an abundance mindset and it’s worked out. Granted what you’re posing is a cash flow question, and less a debt management question, but I wholeheartedly believe it’s ok to go into debt by spending more as long as you carry the intention of increasing your income.

This is certainly true – but I don’t see why we can’t prioritize expanding our revenues rather than cutting back spending. I think the former is a much better use of our collective energy than the latter. Granted it’s an anecdote, but every time in life where I was supposed to “tighten my belt,” it was better to purchase an expensive suit.

1 Like

Well yes, I can understand how you see it from an individual point of view, where you have personal responsibility to pay back your debt, you carry the sanctions of not paying back, and I can also live with a certain level of “borrowing” if the DAO approve several proposals that can start being worked on, until the DAO is getting funded.

But in the DAO nobody is carrying a personal liability to payback, if the DAO is in debt and will be looking for funding to payback for work already done, it will be a tough sale to convince any contributor or VC do that (vs. the traditional fund raising for future plans to be executed

Bottom line what I want to convey is the budgetary management and discipline we are lacking. we can decide that up to 50%-100% debt is fine, or whatever the DAO decide, the most important thing is to develop the practice, scheme, and collective alignment that there is a higher level responsibility to look at beyond the approval of the specific proposal in question, and that is the DAO treasury and budget framework the DAO agreed upon

1 Like

Yes, but the road to hell is paved with unbought stuffed dogs.

1 Like

‘Not my fault.
We went on’
this is. classic hemmingway. who can be a chump. except for. old man and sea.

well kate bee.
we disagree.
though i do see.
nods to e.e.

UPDATE: As of this morning (assuming those proposals that were boosted, and have majority yes vote will pass) and considering a couple of still unredeemed proposals, Genesis is in debt by

ETH -76.77
DAI -26951

Pasting one of my comments to the proposal here!

Just to be clear, I completely support the development of the mobile app and love the work Mark Pereira has been doing for the Genesis ecosystem.

The reason for downvoting is the lack of consideration for the financial situation of Genesis, which negatively impacts all other proposers.

According to my calculations, this proposal will put us into debt until ATLEAST LATE JANUARY 2020.
Debt if passes = 2k DAI (ape-unit) + 65 ETH (dOrg) + 34 ETH + 20K DAI = 100 ETH + 22k DAI

(EDIT: Just saw Kate’s comment and it turns out it’s even worse…)

Dec 16th payment: 20k DAI <- This means either Ape-unit gets paid and Mark can’t redeem or Mark redeem and the DAO is completely broke for 2 full weeks and Ape Unit can’t redeem
Dec 30th payment: ~9k DAI + ~50ETH (if we go ahead with including DAI in the financials) <- Mark would now redeem his proposal leaving the DAO with just 9k DAI for another 2 weeks
Jan 6th payment: ~9k DAI + ~50ETH <- The DAO will have to sell some of the DAI in order to be able to pay out dOrg which results in Genesis again having only 7k DAI to spend for 2 weeks.
!! Around this time dOrg will likely submit another monthly payment proposal, which would put us into debt again…

Jan 20th payment: This could be the first debt-free payment we receive, however, if dOrg submits another 15k proposal mid-January Genesis would only have 5k DAI to left for this period.

We’re all responsible for the financial situation of the Genesis as should take this responsibility seriously!

3 Likes

We should also talk about accountability and methodology. A large tech development proposal should minimally have at least an outline of design, scope and deliverable, not just a two sentence summary. We need to understand screens, integrations, deferred items, etc.

I’m not talking about any proposal in particular. It’s more a question of a general practice.

Agree with Pat, it means we need to prioritize fund raising of the DAO and by doing that shape the value proposition to match the sort of proposals we want to see funded. The challenge will be communicating a coherent mission and culture that entices diverse yet satisfyingly productive participation. For that matter the fundraising efforts must include diverse representation.

The DAO debt is actually a sign of progress toward maturity that says the DAO has found a list of project it is interested in seeing developed rather than waiting for proposals that get submitted just because there is budget that can be deployed.

Essentially now the competition on resources is harder and that should result in higher quality of projects funding. Overtime some projects would graduate being funded by the DAO as they’ll want more operational independence. We should find a way to foster long term mutual benefit with projects that were considerably incubated in GenDAO (e.g. Alice, DAOfest, dHack). I’m thinking we should have GenDAO ecosystem incubator and the leaders from dOrg, Alice ETC can be mentors for new DAO participants for example, but these are ideas for after we figured fund raising :slight_smile:

To sum up, the things that need to happen IMO:

  • Fund raising committe with diverse representation should be set up
  • Value proposition for 3rd party funding of GenDAO
  • Build a mechanism to foster long term connections between GenDAO and affiliated projects for nurturing and mutual benefits.

I won’t be able to join the upcoming pollinators call (:cn::airplane::new_zealand:), but, would be interested to work on that with interested parties. We’re already discussing some of it for dHack with @Eylon and @eric.arsenault. Worth starting it’s own thread probably.

Cheers :purple_heart:

2 Likes

This cannot be overemphasized.

I wholeheartedly believe there’s funding sources available for the DAO, as well as funding pathways, such as:

  • VC/Fund – sale of locked GEN
  • Grants – governmental, NGO (e.g. this governance study being commissioned by the EU could totally be a Genesis project)
  • Other Ethereum orgs – can we grow the DAO’s membership and swap locked GEN for funding?
  • Applications – could we accept management of an app’s smart contracts in order to decentralize as a service provider?

etc…

This is a bold experiment with much to do and a network to do it. Look at Decred, DASH, etc… the DAO “community treasury” model has been proven with much less effective tooling. I fully believe we can do the same with the right backers.

Let’s go whale hunting, folks :whale::bow_and_arrow:

2 Likes

I think incubating DAO projects should be the number 1 priority of Genesis. I would love to help make this happen!

As per the Genesis Budget Management proposal, Genesis agreed to 4 key budgetary buckets

  • Product and Tech ( 70% funding ~ $28k)
  • Research ( 10% funding ~ $4k)
  • Ecosystem ( 15% funding ~ $6k)
  • Other ( 5% funding ~ $2k)

But the Actual Budget in Nov was:

  • Product and Tech ( 59% funding ~ $23.2k)
    • Signal Scheme “Curation of the DAO Header”
    • dOrg Recurring Proposal - November (2/6)
  • Research ( 6.5% funding ~ $2.6k)
    • DAO Legal blog posts proposal
    • Extra work: DAO Landscape research
  • Ecosystem ( 44% funding ~ $17.5k)
    • DAO Meetup in Barcelona (Nov 2019)
    • !! Create alternative onboarding methods !!
    • DAO #Blockathon China Funding Request
    • Completion Reward Proposal: Onboarding Onboarding Report
    • Bootstrap Funding for the FestDAO
    • Funding for Felipe’s FestDAO extra efforts

While the Ecosystem bucket includes activities such as brand awareness, Explaining the concept of DAOs, help onboard developers,on boarding documentation, education, marketing, developer events. In practice we have spent the 20% of Nov funding just on FestDAO. Then, over-run the Ecosystem budget by another 24% ~$9k in funding other DAO meetup and the on-boarding guide work.

Firstly, it is important that Genesis community respect the ‘soft-governance’ proposal passed earlier and in order to catch up with the DAO debt if we have to be selective on proposal then we should down-vote the upcoming fest DAO funding rather than the dev work (Alchemy Moon).

Secondly, it is important to understand that a lot of Dev proposals by default are of higher cost given the time commitment and expertise required and the value offered by work i.e. an app once developed will be used for months by various users vs an event. It is also necessary to note that while it is easy to split Ecosystem proposals by asking funding for each meetup individually, it might not make sense to the same for various development work eg. Once Mark starts working on Alchemy Moon it is all or nothing … A half finished app won’t provide any value.

Lastly, I want to bring attention to the requirement for having reputation cap. In Alchemy Moon proposal we saw how 13 votes (which had some members with pretty high rep) were about able to switch the result against the other 20.

2 Likes

Your numbers add up to 110% (fyi)

1 Like

They do … that’s why the DAO was in debt

1 Like