This document proposes that DXdao formally onboard DaddyMatty (Matt) as a Level 6 Contributor in the Operations Guild, effective from the date of proposal adoption through June 30, 2023 (“Effective Period”).
I’m a CPA with a specialty in mergers and acquisitions (M&A). While I have owned/operated multiple “real world” businesses, I am a full crypto native and I have worked as the Treasury/Finance Lead at Rook DAO since the Fall of 2021. In addition to focusing heavily on developing/managing robust financial operations and financial reporting, I also steward roughly $45M in our diversified Treasury which intertwines closely with governance. The breakdown of the Rook Treasury and its performance can be found on this dashboard.
In addition to the experience referenced at Rook above, I also have been brought on as an advisor to Consola Finance, which is an accounting and data analytics platform that assists crypto-native organizations to more effectively harness the power of their on-chain data.
The purpose of any DAO is to manage and govern its protocol in perpetuity. DAOs, therefore, need to position themselves in a way that not only ensures their ongoing operations can continue but also lets them invest in their protocol’s future growth. Instead of viewing the treasury as a brokerage account, these funds should be used as a checking/saving account to fund the DAO’s mission and operations. Although the DAO structure is a new paradigm in social interaction, in the end, it is just a more transparent and equitable form of organization that should emphasize sustainability and proper risk management.
As such, I believe DAOs like DXdao that have a material amount of product development (like DXdao) should roughly strive to prioritize using treasury funds across four key areas, in order of priority:
- Funding ongoing operations through budgets discussed and ratified through governance
- Building and maintaining capital reserves as a buffer against market volatility
- Funding community grants in support of community-generated initiatives that support the DAOs overall mission
- Making targeted and risk-controlled strategic investments
By focusing on these key uses of funds rather than unrelated speculative investments, DXdao can more effectively manage risk and rewards as well as better align its capital and mission.
To effectively ensure the survival of the DAO treasury, the community controlling it should strive to operate by five key principles:
- Mission-based management: All treasury decisions should be viewed in relation to their impact on the mission of the DAO
- Maintain an infinite time horizon: The treasury should be structured to exist in perpetuity
- Systematic Execution: Decisions should be made in a systematic, informed, and understandable manner
- Diversification is critical: Treasury allocations should ensure that critical expenses can be funded even if the protocol token has a significant drawdown.
- Find Win-Win Scenarios: The most optimal ROI is one where others win with us.
More detailed insight into my mindset/ethos can be found in this podcast interview and in the Rook DAO Treasury Charter.
Proposals, Research, and Tools
Operating in a DAO and performing decentralized decision-making (i.e. governance) requires a great deal of in-depth writing, public research, and real-time reporting. Over my time at Rook, I have personally developed numerous deliverables that have been critical to smooth operations. Additionally, as part of my efforts to increase transparency and increase real-time data for decision-making, I have overseen and assisted in the development of the following of numerous dashboards.
Writings, Research, and Tooling Deliverable
Scope of Work
My anticipated, primary responsibilities at DXdao would include:
- Oversight of financial operations
- Contributing to the DXD Monetary Policy Committee
- Facilitation of executing open market operations
- Day-to-day accounting
- Financial reporting and transparency
- Development of financial statements
- Development of investment dashboards
- Development of dashboards monitoring other key performance indicators
- Payroll processing and structure optimization
- Tracking/execution of ongoing operating costs
- Dues and subscriptions
- Contractor costs
- Reimbursable expenses
- Recruiting costs
- Other organizational expenses
- Budget development and monitoring
- Runway monitoring
- Redemptions monitoring
- Initiative or project-based modeling and projections to support DAO-wide strategy
- Development and support in treasury governance processes.
- Facilitate inbound treasury requests
- Support business development opportunities
- Assistance with treasury stewardship and strategy development
- Lead sourcer and facilitator of M&A opportunities
While my goals for this role will evolve as I gain more knowledge of the DAO and its stakeholders, my initial priorities will be as follows:
- Streamline financial operations by developing tools, infrastructure, and defined policies
- Develop robust financial reporting and data analytics to improve decision-making effectiveness and increase transparency for stakeholders
- Leverage the DXdao treasury to incentivize the use of the product suites through partnerships
- Develop a Treasury Management Framework that provides parameters for the DAO to operate within to limit risk and other negative externalities
- Bifurcate treasury processes and decision-making to optimally balance the impact and reversibility of treasury actions
- Exploring external mandates to investment managers
This proposal is intended to cover work during the Effective Period as a Level 6 Contributor as provided in the Worker Compensation Guidelines. This will be at a 75% commitment as I continue with my role at Rook. The commitment percentage and overall level will be reassessed during Q3 of 2023 as the needs for this position evolve.
The schedule below summarizes the anticipated budget for this role:
- To be specified in the DXdao Operations Guild [link]
- The draft proposal comes with the endorsement of the DXdao Operations Guild [link]
- This proposal requests 3.5 months of payment to be sent to the Operations Guild, which will administer payments for these contributions