Compensation Structure for DAO Contributors

[zaatar]

Did someone say GRIP?

[Caesar]

I thought I just love to rant but thank you sir

A committee or a body sounds fine as long as its representative and upholds meritocracy by adhering to the rulebook that gets created prior.

However, I would be cautious centralising decision-making in one body just because it exists. There can be multiple bodies empowered by the community for different tasks/agendas. That also gives opportunities to new community members with diverse backgrounds to participate in such committees.

We have a long way to go

[Cryptocorn]

Maybe a member of GRIP, a member of PNF and a member of PNI (or DAO appointed representative?) Funding + stewardship could come under GRIP. A 3 person team re-elected each year?

These would be non-binding recommendations for compensation.

[Caesar]

@Caesar

1. Budgeting the DAO treasury could be explored; budget allocated to compensation broken down into subcategories such as R&D, RFPs, bounties, abstract projects/innovations, etc. Helps build structure and do better treasury management.

Didn’t see it in the PNF Roadmap. Maybe @Dermot can guide.

5. Hiring full time employees for the DAO appears debatable but what about proactive annual/quarterly planning of where DAO needs to spend, budget and then seek out resources (from the community or outside). Take a proactive approach instead of reactive and passive.

How much does it really cost to run a DAO? | Token Terminal

Here is a useful article by Token Terminal (big fan!!) that breaks down the DAO budgets at Maker, Lido & SushiSwap.

Maybe Pocket DAO should aspire to produce budget dashboards at some point. Still a rarity in the space.

They hire FTEs (Full Time Equivalents) btw.

Always good to know what the big boys are doing, thought of sharing.

[Jinx (Chris Jenkins)]

Yeah, one of the people needs to be an engineer for sure. Measuring things like complexity, quality, impact with code contributions is one of the more difficult aspects of valuing those proposals.

[msa6867]

@Caesar

However, I would be cautious centralising decision-making in one body just because it exists. There can be multiple bodies empowered by the community for different tasks/agendas. That also gives opportunities to new community members with diverse backgrounds to participate in such committees.

Agreed. See below.

@Cryptocorn

Maybe a member of GRIP, a member of PNF and a member of PNI (or DAO appointed representative?) Funding + stewardship could come under GRIP. A 3 person team re-elected each year?

I would oppose scope creep for GRIP. It was put together and budgeted for a specific mission. Keep it to that mission and populate any new functionality needed separate from and without reference to GRIP.

@Jinx

Yeah, one of the people needs to be an engineer for sure.

IF we end up going that direction I would nominate @poktblade to such a role

@Cryptocorn

I have one major issue with this:

That Caeser is describing himself as a ‘newcomer’ :-). He is now one of the most active members of our community, and we should recognise him as such.

Agreed!

[zaatar]

@Caesar

POKT Samaritans can be rewarded quarterly for great community service - chosen by the “representative individual or body”.

Interesting. What type of community service? And is the “representative individual or body” the same one that would help determine appropriate budgets?

[Jinx (Chris Jenkins)]

Bringing @shane 's comment here since it’s relevant:

POKTscan Geo-Mesh Reimbursement

Nothing like a hot cup of coffee on a Saturday morning, for some forum contributing I’m very appreciative of where this conversation is going. POKTScan submitted this as a per-proposal, which means it was submitted for feedback before presenting a final proposal to the DAO. Major props to them, and others who submit per-proposals, who are asking for specific feedback before publishing a final proposal. Much thanks to the GRIP team for helping construct this system. We are at a plac…

[shane]

Yeah, wasn’t sure where to post it It’s very relevant to here as well.

A code review crew would be great with just ensuring reimbursements are fair. The IMPACT a contribution had in driving ecosystem value can be measured separately with different metrics all-together.

Love to hear more thoughts.

[Jinx (Chris Jenkins)]

Given @deblasis 's comment on the other post, I found this notable as well:

Dework — The task manager for DAOs and decentralized work

I think the EVA idea is interesting, and would think everyone who shows up on these lists could potentially be eligible.

[zaatar]

Complex Budget Calculations

@Cryptocorn

Maybe not a hiring committee as such, but a ‘soft guidance’ committee (potentially part of GRIP’s remit?) to give a suggestion when there are cases of ambiguity on asking for compensation.

Proposers wouldn’t have to ask for the recommended number, they could still ask for more/less, but it would give some gravitas: ‘GRIP Funding Committee recommended I receive 200k POKT and that is the amount I’m asking for’ as an example.

@Jinx

I’ve suggested oversight committee type structure in the past, and the challenges of evaluating engineering contributions are a driving reason for that. I don’t think that’s GRIP necessarily, but perhaps a similar structure.

@Cryptocorn

Let me rephrase: non-binding committee suggesting an evaluated amount. People can value themselves more or less, but a neutral, repeatable formula or set of standards that can be applied by a third party to offer a ballpark figure.

Although I appreciate we may get into new issues of who’s on the committee and potential for politics etc there.

@msa6867

@Cryptocorn

Maybe a member of GRIP, a member of PNF and a member of PNI (or DAO appointed representative?) Funding + stewardship could come under GRIP. A 3 person team re-elected each year?

I would oppose scope creep for GRIP. It was put together and budgeted for a specific mission. Keep it to that mission and populate any new functionality needed separate from and without reference to GRIP.

We don’t want GRIP creep. At the same time, however, part of GRIP’s mandate as per PEP-45 is to use its expertise to help technical proposal drafters determine appropriate compensation:

@zaatar

The technical specialists will consider any amounts being sought for reimbursement or advance funding and opine regarding the appropriate budget.

Accordingly, it makes total sense for GRIP to play a role in budget assessment. I like Cryptocorn’s idea of a three-person committee: GRIP member, PNF member and a DAO-appointed representative. For small asks, I don’t see anything untoward or controversial about GRIP providing a budget assessment on its own. After all, that 's part of GRIP’s mandate. But I do agree that for large funding requests (and at the contributor’s request, for smaller ones too), the assessment should be done by a committee (including the GRIP member).

@Caesar

I would be cautious centralising decision-making in one body just because it exists. There can be multiple bodies empowered by the community for different tasks. That also gives opportunities to new community members with diverse backgrounds to participate.

Centralisation and issues of “who’s on the committee” are valid concerns in regards to decision making, but much less so if the committee merely suggests a budget and lets the proposal author decide. However, to allay what concerns may exist, the DAO member could rotate among a roster of qualified individuals who get compensated for their participation. Also, the GRIP technical specialist could change from time to time.

Imbursement?

Before Pocket, I had never come across this word.

@Jinx

Reimbursement and imbursement are listed as synonyms in the thesaurus, so I was driving towards some clarity in meaning,

@ethen

I think we could use Grants, but I like Imbursement as it works well with Reimbursement and is an allocation that has yet to be earned, whereas Reimbursement is for work already completed.

Trying to simplify the process here.

The proposal template is being revised: here’s the related Google Doc (feel free to add comments). “Imbursements,” for clarity, may be replaced by “Advance Pay.” While surprisingly “imbursement” is an actual word, as Jinx notes, it does not mean “advance payment.” See the Wikipedia entry.

DAO Treasurer?

@Caesar

We need individuals with finance and business acumen involved in managing the DAO treasury, payments and budget planning.

I strongly agree. A Treasurer? Convert some POKT to stables, perhaps U.S. dollars and invest. What are other DAOs doing?

Fiscal Prudence

@Caesar

With upcoming inflation cuts, POKT allocation to the DAO treasury will reduce accordingly- just wanted to remind everyone.
…

There shouldn’t be knee-jerk payments (especially large ones) because of pressures and historical connections. We need to look forward.

I suggest working on a plan, and until then we halt any payouts that are not already in the voting stage.

Interesting idea. We definitely need to factor diminishing DAO reserves due to inflation cuts into our spending decisions.

[Caesar]

@zaatar

@Caesar

POKT Samaritans can be rewarded quarterly for great community service - chosen by the “representative individual or body”.

Interesting. What type of community service? And is the “representative individual or body” the same one that would help determine appropriate budgets?

Please read the excerpt from @RawthiL 's post

@RawthiL

I find myself sometimes talking to random people asking for advise on random subject and random times. Nobody pays me for that, but I have the knowledge and I can help them. I would be in all my right to just ignore these people. If the DAO thinks that this kind of interaction is worth of being rewarded, then they should be included as candidates for rewards.

There was something very similar from @Cryptocorn in some other post of his about educating the community, answering their questions on a consistent basis.

I agree that we should generously reward good actors from the community volunteering their personal time towards the project, as long as there is no other way he/she is getting compensated for the same work.

It’s an incentive to drive good and responsible behaviour, and also increase community time of many qualified actors.

So the suggestion is to put this under “Rewards Program” that we don’t have yet.

• Fix a budget
• Fix a number (3-5 POKT Samaritans per quarter)
• Put a criteria in place
• Announce/Advertise to the community

The above is just an outline, the mechanics such as who selects the samaritans and others can be worked out once we decide to go ahead with the plan.

[Caesar]

@zaatar

@Caesar

We need individuals with finance and business acumen involved in managing the DAO treasury, payments and budget planning.

I strongly agree. A Treasurer? Convert some POKT to stables, perhaps U.S. dollars and invest. What are other DAOs doing?

The scope of the above suggestion is much larger than the discussion around compensation. Compensation is just a subset.

Includes things such as risk assessment, diversification (such as stables), security, allocation, etc.

Might also include investing to grow the funds such as how it’s done by college endowments.

In the meanwhile please read the article I shared earlier to get an idea of how other DAOs are allocating their funds.

Bottomline is we should consider active treasury management of the DAO funds that also includes budgeting and planning.

I might start a fresh post on this.

[deblasis (Alessandro De Blasis)]

Hi there, I was diverted here from @b3n since the conversation was derailing way too much from the topic in POKTscan Geo-Mesh Reimbursement - #21 by shane

@shane:
I think I didn’t make myself clear, I apologize.
I am still quite ignorant , still learning the ropes of DAO, PNI, PNF and their interactions and also the terminologies (reimbursement, EVA, etc).

I haven’t read this whole thread either, but I will catch up.

Also, I have a bit of tunnel vision with V1 and I don’t know much of what’s happening in V0 and overall in the node-running community.

Where I believe it is important to distinguish between contributors is “are they being compensated with an hourly wage during this work?”. For the v1 team, they are given an hourly wage for working on POKT, so there is no reason for individual contributors to submit reimbursement proposals. Even if you did crack geo-mesh, you should not be submitting a proposal for reimbursement because you were already paid. PNI already submitted PEP-49 to help fund your wages.

I am not and would never ask for a reimbursement as you define it for something I am already being paid for.

I was talking about something innovative and/or that solves real problems developed outside of my regular responsibilities and duties, in my spare time, beyond what I am already being paid for.

I won’t do that anytime soon, I was talking hypothetically just to challenge some of the ideas.

I have used GeoMesh purely as an example since it’s v0 related and clearly doesn’t fall under the umbrella of “v1 protocol development”.
I realize I have used the word “prize” erroneously in my previous message in the GeoMesh thread.

I agree that with proposals being essentually “black boxes” it is hard to distinguish what is what. The only way to proceed in a fair manner is to have transparency.

I totally agree that transparency is necessary otherwise trust is lost and we are back in the Web2 realm.

Transparency has several shapes and forms. What if it’s the process of selecting fairly that becomes transparent?

• Is asking for a detailed cost breakdown the best way?
• Who is gonna ultimately deliberate if a proposal ask is valid?
  • Can these folks be trusted? What process would check the fairness of their judgement?
• Should the lean and hyper-efficient business that can deliver more value at a lower cost be penalized or rewarded?

There’s a lot I could say here but I also have some code to write so I’ll try to summarize:

I think it’s important to distinguish between different ways of contribution (I suck at naming things, bear with me):

• Pull: work whose scope and/or need is known before even a single line of code is written and has to be researched, built, delivered by the community
• Push: A community member/entity comes up with something that wants to share with the broader community

Why this distinction?

Let me use a couple of metaphors:

Pull model

If I need some work to be performed around my house I ask for a quote from multiple parties, too high? Next. Nobody else? Ok, I’ll take it, I really need a roof! If I can’t really find anyone with my budget I raise it until I find a bid. (efficient markets)

Push model

I am chilling in the garden minding my own business and someone comes to me saying: “you could really benefit from some solar lights in your garden, it would really increase the value of your property, etc, etc. I have some for 4000 POKT in my trunk, I am gonna give them to you at cost, trust me. Should I bring and install them?”

What if… in the push model you would have something something like:

• contributor: I have really enjoyed that barbecue you offered the other day, please take these lamps on me, enjoy! I don’t expect anything back because I am already benefitting from you but I’ll take whatever you have to offer of course (Open source model)
• me: oh, thanks! Well, let’s have a beer together -or- I have been looking for these in years! Please take this bag, you deserve it and I’ll make it back quickly thanks to your contribution.

I personally think that reimbursements alone are probably not the optimal way to handle things.

A group of individuals cannot possibly evaluate with fairness something that a team has built even if bills, timesheets and even team lunch recipes are presented. Costs are different for different companies. It’s never an apple vs apple comparison.
Only the market has the capacity to determine the “fair” price for something IMHO.
Competitiveness is key.

Example: I live in the UK but I don’t compete in the UK job market. The Web3 world I want to live in doesn’t care about the cost of your real estate. It only cares about the value that you bring to the table.

Using again GeoMesh -just as an example-, since Web3 is all about incentives, I think I would have created a public bounty to
“develop a solution that levels the playing field in the node running community since there are node runners that are seeing 2x-3x the rewards leaving the others dry” (or better technical description).
Along with an estimated budget that I think should be small initially and grow until there’s interest from community builders.

Like an auction. Similar to what happens in the public administration world with their suppliers for goods/services.

Contributors submit their carefully estimated asking amounts to deliver within a deadline before they commit and do any work.

At the deadline or when the first contributor submits a solution, there’s a verification process (performed by a trusted committee, you guys might have already talked about something similar above, I think my eyes caught something while scrolling the thread, GRIP?).

If all is good (we’d need an objective way to determine if the solution is acceptable, sometimes it’s easy, sometimes it’s really hard and time-consuming, TBD) you reward the contributor.

If something is wrong, the competitive auction is back on until the contributor addresses the functional issues (the other contributors might have given up completely or not).
Again, the first to submit for verification is the runner-up to win the bounty but they cannot submit twice in a row if there are other runner-ups. This should increase the quality of the updates to the initial submission and also reward both speed and quality.

The whole thing should be conducted in the open apart from showing implementation details of the various solutions to competing contributors (you’d need again trusted folks to manage the process of course. Immediate termination for collusion/corruption, and harsh measures to be put in place to deter any shenanigans).
If the process stalls because all the contributors gave up, you auction again and repeat the above.
Quitters should be motivated to stand up and try again leveraging the partial work already done thanks to the bigger incentive.

This way you have a Darwinian selection of the best solution at the best price IMHO.
Easier said than done, that’s for sure.

As I said in the other thread, fairness is subjective. Only nature and its approximations like “fair markets” can be fair and if you are on the losing side you can only and try again or quit altogether. That’s life isn’t it?

Is it fair that the lion eats the gazelle? Ask both of them… or the zebra that’s observing the whole thing from afar.

Working on something and ending up not winning or ending up spending more than the amount initially auctioned for should be considered a business risk to learn/evolve from. (you are the gazelle)

Having a lean organisation, because of geography, headcount and/or skills should be considered a competitive edge that allows you to win more bounties, scale, repeat. (you are the lion)

Of course, since it’s all open source at the end of the day when the winner’s solution is merged/made public, other contributors can learn from the winners and try to reverse engineer their success formula… next time they might have a better chance. (you are a hyena that dreams of becoming a lion)

Again, the natural selection process aims at improving things at every iteration, including the internal processes that would make all the above possible.

[Caesar]

@Caesar

There shouldn’t be knee-jerk payments (especially large ones) because of pressures and historical connections. We need to look forward.

I suggest working on a plan, and until then we halt any payouts that are not already in the voting stage.

I felt I owe a clarification for the last sentence so that there is no misunderstanding. I have refrained from commenting directly on reimbursements (except corn’s) because I don’t have the same insights to history as most of the seasoned community members do and also because I am not a DAO member yet.

However, I still believe that there needs to be a transition point between status quo and a structured approach to payments that we all roughly seem to agree on. And one of those possible transition points could be V0->V1.

Basically the plan (whatever that is) ideally should be put together and rolled out before V1 test net (before Q4) with an effective date .

Otherwise status quo will continue to prevail in V1 as well.

This post is not addressed to any individual, it is to the community.

[ethen]

Gotta say, I love the way you communicate deblais.

@deblasis

Using again GeoMesh -just as an example-, since Web3 is all about incentives, I think I would have created a public bounty to
“develop a solution that levels the playing field in the node running community since there are node runners that are seeing 2x-3x the rewards leaving the others dry” (or better technical description).
Along with an estimated budget that I think should be small initially and grow until there’s interest from community builders.

Innovation doesn’t work like that. And I don’t think we want the brightest minds of our community thinking “this is a great idea, let me write up a proposal for it”.

It’s a shame actually that developers have to come here and talk about pay standards. But I do think we are making progress. This has turned out to be a fantastic thread.

@deblasis
Back to what you said about a 4 year vest and -69% of the total Geo-Mesh spend. I don’t think we can continue paying out contributors with outdated payment methods. 4 year vest is a lifetime in crypto. I’d like to see us move to 18 month vesting with the initial cliff happening on the 1st or 3rd months. Of course anyone signed to an agreement like that has already proven themselves to be valuable withing the community and ecosystem.

A chatGPT excerpt below
“The practice of paying employees for their work has a long history, dating back thousands of years. In ancient civilizations, people were paid in goods or services, rather than money. For example, in ancient Greece, workers were paid in olive oil or barley, while in ancient China, they were paid in rice.”

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I also think we should speed up our decision making. More of the thread respondents need to throw out actually numbers.

Not ok with 5.5m Geo-Mesh? ok, how much?

LeanPOKT 7m too high? How does 6m sound?

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To the PNI employees - I’m sorry that you feel the disconnect between potential dao contributor payouts and pni staff. We really shouldn’t compare the two. One of the main reasons DAO’s exists is so that we can unlock these new payment methods and structures. Crypto and web3 are all a game and the same rules do not apply.

[ethen]

@zaatar

The proposal template is being revised: here’s the related Google Doc (feel free to add comments). “Imbursements,” for clarity, may be replaced by “Advance Pay.” While surprisingly “imbursement” is an actual word, as Jinx notes, it does not mean “advance payment.” See the Wikipedia entry .

Proposals

[Caesar]

@ethen

But I do think we are making progress. This has turned out to be a fantastic thread.

I agree with Ethen here and I was also thinking of writing this but I kept missing- The objective behind having better governance and a structure around compensation (the topic of discussion) is not to add bureaucracy and to make it painful for the contributors, vendors, the deserving to get paid and rewarded. That’s not the vantage point I come from.

It also involves removing unnecessary frictions (roadblocks & bureaucracy) or the possible ones, and at the same time uphold values such as meritocracy , transparency through a set of agreed rules.

Sorry, had to rant

[Jinx (Chris Jenkins)]

I want to resurface this idea because I think it is the first clear and cogent deliverable from this conversation. Having the EVA structure in place would allow for reimbursements to segment recouping hard costs and pair that with additional milestone bonuses in a way that would both help reduce sticker shock (spreading the ask out over time) and allow for many different contributor types to benefit. Teams like @poktblade and @RawthiL 's get the added value of impact measurement, and core contributors like @deblasis and @Olshansky can participate in a meaningful way above and beyond the requirements and compensation of their full time position.

I’m going to ping @shane to rough out some ideas, and see about getting a pre-proposal together.

[Caesar]

Hi @Jinx , am curious about the scope of this post. “Compensation Structure for DAO Contributors” has a much bigger scope and encompasses all kinds of comps. And I believe that the community discussions around that have been great. Solutioning (getting into specifics) is the next phase.

Your proposed solution above addresses “reimbursements” only (if I understand it correctly), which is a subset of DAO Comp as a whole.

So my question again is, what is the scope and the agenda here?

Are you thinking of breaking this down into smaller subsets (reimbursements in this case), solve them one by one basically?