1. The Pocket DAO is adapting from a place that simply allocates funds to an entity focused on executing projects towards shared ambitions
2. We want the DAO to get into flow by aligning around a single, shared “Era” leading up to V1 launch
3. This will include the creation of a single “DAO budget” for key investments within this Era, and be supplemented from the DAO take - creating certainty that we can support community contributions towards these goals, while remaining flexible to changes based on the prevailing price of POKT
4. We will have a lite mechanism of “Cycles” to operate transparently and to learn and iterate, but without major distraction from the core role of executing
Pocket DAO has mostly been a house to allocate resources to inbound proposals. Clarifying our DNA, the PNF ecosystem thesis and the launch of “keystone” projects such as The Road to Revenue change the dynamic of the DAO, making us more aligned and bi-directional than before. It’s important to consider operational changes within the DAO that can support and amplify this work.
As it is, PNF’s mission is to increase the DAO’s impact, we have considered how best to leverage the DAO’s collective talents. The way that we describe this is that we want the DAO to be in “flow”.
Flow has numerous positive meanings, especially as:
the positive mental state of being completely absorbed, focused, and involved in your activities at a certain point in time, as well as deriving enjoyment from being engaged in that activity
Flow is about maximising challenge relative to your capability and creating focus at the exclusion of distractions, which in turn creates growth and value creation. This is what we want the DAO to be.
To get into this flow state we need to build some new activities and rituals. To avoid many of the widely known issues of web3 DAO’s, we have designed around two key principles:
1. Prioritise resource allocation towards the highest priority activities
2. Operate with simplicity and focus
These are described further below.
The DAO ultimately wants to maximise the return on its financial and human resources. To do this, it must efficiently prioritise resources to activities that achieve sustainable, long-term value creation and capture. These activities and opportunities were outlined in the PNF ecosystem thesis.
With these ambitions and metrics defined, one simple method for allocating resources is to stack rank work to be done across:
Must Do: Keystone projects likely to have the biggest impact towards our ambitions
Should Do: Supporting work that will help proliferate and amplify the impact of keystone projects
Could Do: Open opportunity spaces and experiments that can form bottom-up to help further accelerate towards our ambitions through the community
Prioritising this way will reinforce our shared commitments and create clarity in where community contributions will be sought and supported. With a budget, the DAO will be more certain of where it plans to spend its resources (and where it doesn’t), its expected burn and enable us all to better prioritise our time and mental energy with a deep focus on execution.
PNF has advanced on some steps toward this already:
- Align on a set of Goals/Ambitions for the coming DAO era (PNF Thesis) - Done
- Align on the major (keystone) investments in pursuit of these ambitions - Done
- Understand what other important work should or could be completed (ie. POPs, Sockets) - Done
- Create a simple budget mechanism that can quickly align us but is adaptable to the changing status of our ambitions and treasury - In progress, and discussed below
The budget mechanism that we plan to propose aims to do two things:
1. Provide certainty of resources to must have investments
We will submit a budget for the Keystone investments and projects to be approved by DAO voters, creating certainty that funds are available for new gateways, wPOKT and a Tier 1 listing
2. Remain flexible to evolving circumstances
We will operate support for other investments, projects and community experiments (should have and could have as listed above) using a proportional 80% of the future DAO take. In this way, we can scale up or down community contributions based on the prevailing price of POKT, while still prioritising resources to our major ambitions and maintaining growth in the overall treasury over time
Bringing all of this together, we will also implement a major coordination mechanism under the concept of an Era. The Era is a longer, milestone-based time period that will act as a capsule for execution of the strategic plan (the PNF thesis). It will capture one instance of budgeting and then allow focus on execution up to the milestone date.
This first Era will take us to V1 launch, meaning we will complete the budget above now and with the agreed proportion of DAO take remaining in place up until V1 is launched. This certainty will allow focus and allow us to get into the flow state - building up our capability and contributions towards these shared goals and minimising the distraction of what we expect will be a much smaller number of retroactive funding requests in future.
The Era itself will operate transparently with opportunities for learning and adaptation to improve the system over time. This will happen through the concept of a recurring Cycle. The cycle is a 2 month period at the end of which the whole DAO - all contributors, projects and work streams within it - will align during a single week for retrospectives to discuss learnings, make necessary adaptations, share transparently and then get ready to go again with their whole focus on executing for the duration of the next cycle.
And so to summarise again:
1. The DAO is adapting from a place that simply allocates funds to an entity focused on executing projects towards shared ambitions
2. We will do this with a focus on a single “Era” leading up to V1 launch to create clarity, alignment and focus on the path towards this major milestone
3. We will maintain a single budget for key investments within this Era, and supplement it with reserved funding for additional projects and contributions from the DAO take - creating certainty of opportunity for community contributions towards these ambitions, while remaining flexible to changes based on the prevailing price of POKT
4. We will have a lite mechanism of “Cycles” to learn and iterate on improvements without regular distraction from the core role of executing
We believe this simple structure can power us towards our ambitions, allocate resources effectively, and create more clarity for people to understand how they can contribute towards and access funds to support us in pursuit of these ambitions. We ask the community to share feedback on this approach and to provide comments or questions on the above over the next 7 days, after which time PNF will submit a proposed budget for our must have “keystone” projects and a proposal to direct a proportion of the DAO take towards community contributions that support these ambitions.
Provided below is a visual bringing the components of this system together, as well as a description of key terminology within the broader org design.
Eras (think of the concept of Epochs / Generations / Age / Theme)
The major planning period of the DAO. A larger time series that is variable in length. Right now, we are in the v0 era and preparing for the v1 era, something like “Pocket’s Apollo Era: preparing to reach escape velocity”. The exact name of this first era is TBD.
Cycles (think of a recurring Session / Span / Stage / Sprint)
A 2 month coordination cycle to allow us to review, learn, adapt and iterate. These should allow us to calibrate within an era. These are a performance mechanism and a logical point to adjust, with an emphasis on learning/adaptability and not re-litigating strategy
Ambitions (think of BHAGs - big, hairy, audacious goals)
Each era has a set of major ambitions that pursue impact against one of our key metrics. These ambitions can be broken down into work that is:
- Must have: The keystone projects that need to be completed (Foundation-led, for now)
- Should have: A set of PNF-defined open opportunities as well as a set of DAO recommended priorities to be funded
- Could have: An allocation of funds to support experiments like Sockets that pursue impact against one of these key metrics. Support for experiments and sockets is on the basis that they are specifically pursuing and demonstrating impact against our metrics
Era Budget (a one off proposal to fund the DAO’s priority projects)
The Era budget is a one time major budgeting practice to ensure the DAO allocates sufficient funds to pursue its priorities. This has 2 parts:
- A defined budget for our keystone, must have projects
- A defined 80% of the DAO take reserved for community contributions to the ambitions via RFPs (POPs) and seed funding contributions and experiments (Sockets).
If you would like to understand more of the logic behind this please read up on the ideas of Beyond Budgeting.
Permissions (think of a lite set of requirements that need to be met to access funds)
We want to create a very low permission environment that allows contributors to access funds that support their work and experiments, until such time as these activities are observed to not be generating impact. For this reason, the current access to being permissioned is:
- Anyone who has a DAO vote, is author/recipient of a previously funded proposal, has completed a socket or bounty or has the DNA NFT (in design) is permissioned to sockets, bounties, and nominating new Pocket Open Priorities by default.
POPs (Pocket Open Priorities)
POPs are a set of Pocket Open Priorities that will operate much like an RFP process. In this way, funds are reserved for important work and the best capability is sought from both within and outside the community to execute, based on who has the high capability to deliver.
Sockets (think seed or experimental funding for contributors to access)
Sockets are small seed funds that make it easier to access funds to support work and experiments. Funds are provided on the basis that a contributor will:
- Express which ambition and metrics that will support and impact
- Work in the open and self report regularly
- Operate in the expectation that funds will be withdrawn if results are not delivered
Together, all of the above will create the push and pull of a talent marketplace for achieving Pocket’s ambitions