Proposal: DAO Research: Studying Closed Organizations Transitioning to Open Networks

Grant Proposals, Bounties and Awards
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Summary

In order to better understand the shape and unique differentiators of Decentralized Autonomous Organizations, this research studies DAOs through two lenses:

  1. DAOs as Internet Native Organizations that harness decentralized technology.
  2. Studying the transition process from “legacy or centralized” to decentralized, in order to document the real changes, catalysts, and decisions made to clearly distinguish between the two.

This proposal fulfills the following deliverables:

  • Polish and publish a framework that maps the journey of decentralized organizations
  • Utilize the framework to document main challenges in each stage
  • Onboard contributors to the framework
  • Present the framework and updates at ETHAmsterdam
  • Identify and write up at least 3 use cases of existing teams’ efforts towards building decentralized organizations
  • Document consistently used and best practices in the space: Token Engineering/economics, Governance models, Ecosystem development, Legal Entity, Org design, etc

Problem & Background

With the surge of DAOs in the past year, many have been asking the same questions in order to grasp and define “the shape of DAOs”. What are DAOs? How are DAOs unique to Co-Ops or Corporations? What kind of challenges do DAOs have?

While the purpose of this research is not to define “What is a DAO”, it does attempt to define primitives or consistent challenges that decentralized organizations may have, particularly to help others in the decentralization process. Through initial studies, my current hypothesis is that DAOs have a combination of unique features not seen in other models today:

  • Internet Native Behaviors (ie. Network effects and Autonomous execution)
  • Self-Organization
  • Connected, Multi-party Ownership (ie. DAOs in DAOs)

Through this lens, this research will explore questions:

  1. What are the unique features of internet native organizations?
  2. Why and how is decentralization (social and technical) a key part of this?
  3. Are we able to identify those through the lens of existing DAOs?
  4. What are the current use cases and are there any we have not uncovered yet?
  5. What makes DAOs unique in comparison to existing structures? With this in consideration, are DAOs any better than regular corporations?
  6. Secondary: Is (and if so, why) is community ownership an advantage?

The secondary goal will be to explore the nuances of building and growing organizations. These tensions include:

  • Information & Trust: Intimate <> Scale
  • Decisions: Wisdom of the Crowd <> People with Expertise/Context
  • Ownership: Speculative vs Participant
  • Stakeholder Balance: Token Holders, Delegates, Community/Wisdom of Crowd, Facilitators/Executioners
  • Rational Thinking / Engineering behaviors <> Understanding People/Community Behavior

This research attempts to document best practices and provide practical guidance for teams embarking on the decentralization journey today.

Proposed Work / Goals:

This existing thesis will serve as a base, with research further refining the model.

  • Onboard contributors to the framework
  • Gather historical information
  • Identify and write up at least 3 use cases
  • Identify and document consistently used and best practices in the space: Token Engineering/economics, Governance models, Ecosystem development, Legal Entity, Org design, etc

Interview and Research Projects:

Some interviews will be more in depth (ie. Full case study on Maker), and some will be specific areas (ie. Token Launch). Some examples:

  • DeFi/Protocol: Maker, Yearn, Synthetix, Element, Sushi, Compound, Uniswap, Gnosis
  • Product Focused: Index Coop, Radicle, DxDAO, Gitcoin
  • Other: The Graph
  • Social/IP: FwB, MetaCartel, HollyDAO, plsrDAO, Lil Miquela/Brud
  • DAO2DAO/Service/Tooling: Orca, Gnosis Guild, Sourcecred, Tally, Snapshot, FairmintCo, Tribute Labs, collab.land

Milestones / Outcomes:

Date Outcome Description
Week 1-2 Publish Initial Framework (Public Post) Refine framework, Onboard team members, Introduce ongoing research
Ongoing Weekly Updates in SCRF Forum Short summaries from weekly syncs and Braintrust sessions
April 2022 Publish Mid-Update (Public Post). Present at ETHAmsterdam Highlight lessons from ongoing interviews with teams & experts
May 2022 Publish Final Output (Public Post) Include at least 3 case studies

Other Measures of Success:

  • This should not be too academic. Response to the framework is practical, approachable, actionable.
  • References/Citations of the framework from external parties
  • People build resources (ie. business model canvas) based on this framework

Operations

People

Team
Lead
Editor
2 Case Study Researchers: Writer + Design Researcher

External Partners:
Braintrust Session: A mix of builders and active delegates to provide diverse insight into the development of the framework and research.
Other Partners: DAOs and other people who are interested in building around this framework

Structure

Time Purpose People
Onboarding 1.5 Hr / One off Bringing team up to speed on current research and methods for collecting information Team
Interviews 1-3 Hrs Week / One off Interviewing team members, sourcing first-point perspectives 1-2 Leads
Weekly Sync 1 Hr / Weekly Discussing findings and updates to the framework Team
Braintrust Session 1 Hr / Bi-Weekly Gathering deep thinkers to discuss existing research and models Team + External Researchers
Async Work 3-10 Hrs Weekly Writing and synthesizing Team
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@amy thank you so much for contributing this, and including a link to your thesis, which was particularly interesting to read. Do you have a sense of which communities and thought leaders you might interview for your case studies?

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Thanks for reading through. Was there anything in particular that resonated or stood out?

Regarding communities/thought leaders, here is my shortlist:

I think Maker, Gnosis, The Graph, Index Coop, FwB are all most interesting as full case studies.

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That’s a great list! I didn’t realize that The Graph was running a DAO, which is super interesting. I wonder if Chainlink and some of the other infrastructure providers will eventually Exit to Community…

About your thesis, I really liked the callbacks to 17th Century printing technology and the comparisons between the Catholic and Protestant Churches. Clicks with a lot of the essays about ‘lore’ and other inter- and external communications communities.

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Hi Amy – I enjoyed reading your proposal. As I read through it, I had a number of thoughts/comments which follow. Please note, this is meant as some external input to help refine your thinking, not as a critique. Broadly speaking, I like what you are trying to accomplish.

I think that there is a real gap in qualitative insight when it comes to an aggregated understanding of how DAOs have performed so far, we do need a synthesis of what generally works well, and what the common points of failure are. In this light, I see the final deliverable you describe as being an important piece of work. “Document consistently used and best practices in the space: Token Engineering/economics, Governance models, Ecosystem development, Legal Entity, Org design, etc.” Would you consider adding community management practices/strategy to this?

Am I right in assuming that this would be the core of the work you propose to undertake? It sounds like the framework you describe would be the derivative of that.

When it comes to the questions you propose, my first impression is that there are lots, and they are quite broad. These are interesting areas, but answering them comprehensively might be difficult. It may help to focus on one core research question, and I think it would be something to do with this: “This research attempts to document best practices (and common mistakes?) and provide practical guidance for teams embarking on the decentralization journey today”.

I really like the secondary goals. The tensions you list are crucial tradeoffs in traditional organisations, and it would be very interesting to see how they translate into DAOs. The whole list is great, but I particularly like this one: “Rational Thinking / Engineering behaviors <> Understanding People/Community Behavior”.

I enjoyed reading your thesis on figma. It’s a pretty solid foundation for what you are trying to do here.

I agree with your note that this should be too academic, as it’s got some real practical outcomes. Also, I think your timeline is a bit aggressive (but they usually are).

All in all, this seems like an interesting and needed piece of work. I wish you the best of luck.

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Thanks for all the feedback @dwither! It’s great to get external perspective after working on it alone for some time.

Absolutely!

I’m hoping to pull these from the case studies and interviews. There’s a lot of work being done by other teams/DAOs with expertise in each of these fields so some of it might be aggregated efforts.

Great observation. I don’t intend to directly answer them - I see them as guiding questions for the framework. Given your feedback, I might start with one or two and widdle down.

Indeed it was :sweat_smile: Revised timeline in my updates below.

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Update #1:

  • I’m currently delayed due to scouting and onboarding 3 team members. We’ve agreed to continue discussion at Amsterdam.
  • I received feedback from a potential contributor and started working on a revised version of the framework. We are planning on workshopping a session after Amsterdam.
  • I had a great discussion with RnDAO regarding a collaboration to build one case study together, folding in some of the resources they’ve been working on.

Meanwhile, I started to join more public facing discussions:

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Final update:

Below are the recordings from talks I’ve given on this topic.

DAOist’s Global Governance Gathering in Amsterdam - “Moving to Community Ownership”

Stanford DAO Symposium - “So You Want to Build a DAO?”

DAO NYC - “Delegation in DAOs” Panel

I’ve been informally chatting and making some small tweaks to the framework, but decided to close and move on from this grant. Thank you to the SCRF team for all your support!

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