Ok that’s good context. Your initial post mentioned grew by 50and it came off as 10 in total in March 2022. So the framing was off.
The number of employees that are here today that were here pre March 2022 is about 15. But to be clear as of March 2022 there were 30ish employees and this grew to 68 at end of 2022. It’s a fast growth but not 10 to 68 which is 7x. We are at 54 now not 65. I plan for very few nominal hires in 2023 for just key engineering / sales roles.
Hopefully this provides more context overall. Of the 15 that left, there was a combination of those that we let go as well as those that voluntarily left. I don’t see any of those gating deliverables in anyway and honestly the company outgrew them most likely from the small start up it was to what was needed.
I think something that should be made clear is what while many of us support this proposal, few of us (that I’ve talked to) like this proposal. No one likes what the token value is currently, which is a major driver for the need for additional incentive options. Fair criticisms have been made about management and financial strategy prior to @Lax joining the team. No one likes that initiatives such as wPOKT, which would have introduced additional liquidity and given us the DEX exposure needed to ride some of the rallies in the market, have never come to pass. There’s nothing to like about any of these things.
But I strongly support the proposal because I recognize it is necessary.
Like it or not, no other team is in a position to get us across the line to v1, which is a critical step in both achieving the goals of permissionless high QoS dapp staking, and maintaining a competitive advantage in a market that is seeing other players coming up now that Pocket has proven the need for decentralization in the RPC space. If PNI fails, Pocket fails, and none of us want to see that happen.
While legitimate criticisms have been made, punitive measures which fundamentally challenge the team’s ability to retain talent are not the answer to that. Transparency and accountability are, which Mike, Art, and Lax have demonstrated they are committed to.
I will not like it, but I will vote in favor of this proposal.
v1 is hostage to paying this PEP. As Jinx says, I don’t like this, but 45M to get v1 out is worth it.
Tangential but a difficult discussion that should be considered, why have so many people in management left with their full POKT allowance?
We are in difficult times, in part because previous COO, CTO and other top management and their decisions. The fact they can just walk off with 45,000,000, 30,000,000 POKT etc is ridiculous. If the PNI doesn’t have enough POKT due in part to these people’s decisions, it should be clawing this back.
I understand that people worked hard while early employees and were given allowances based on risk at an early stage start up. I also understand that people can have mental health issues and leave. But when you leave a company when things are bad, for whatever reason, you should get some of your rewards, not all of them. Nothing worse than a start up where early founders have left with a ton of equity.
We should approach these founders under mediation and see if there is a workable solution that they can contribute towards this PEP. We should be under no illusion that this will be awkward for management who are friends with these people, but times are tough and action like this should be taken. This can be escalated if mediation fails or previous employees are unwilling to contribute.
I started writing some points I wanted to outline with this proposal yesterday. I since have spoken to quite a few community members on the topic and we all seem to derive the same conclusion. While this proposal makes us extremely anxious, we do understand what is at stake and the necessity to support it.
I am totally in favor of incentivizing current employees and acquiring the best talent available in the marketplace. However, I do feel it is hypocritical of me to support this proposal after rejecting PEP-35 due to its lack of clarity on its requested amount. But I do understand it is in the best interest of everyone, whether it is on a personal level or purely business, to support the continuity and success of PNI. If PNI fails, pocket fails, and where exactly does that leave us? I doubt anyone of us wishes to find out.
I would like to know who these 4 headcounts are. It seems transparency at that level is on a need-to-know basis and evidently, the proposer doesn’t believe we need to know. Many argue the proposals for both LeanPOKT and this one are different. While true, I do see some similarities. The major one being the inability to quantify the asking amount. By voting to approve this proposal we will be setting a new precedent. Nevertheless, I will support it.
It took me a while to gather my thoughts about this proposal, and in the meantime, they have already been expressed better and more eloquently by others (poktblade, zataar and Shane).
I’ve got mixed feelings about this PEP, but ultimately am inclined to support it. As a small fry node runner, it bugs me a little that I’d be voting to grant this much Pokt to a large company that will use it to run nodes and compete with me for relays, particularly as this proposal seems to be a result of some missteps on their part. On the other hand, I understand what that the funds are intended for: to retain good talent and to incentivize future hires, with the intent to both build up and drive demand to the ecosystem. Should PNI succeed, the rising tide will lift all boats.
The debate has gotten contentious, but it’s been a necessary one to have. Like it or not, PNI is an entity in the ecosystem that’s too big to fail, and should this proposal not pass, then the real winners will be the upstart competitors like Lava or – God forbid – Infura.
I retract this point. I agree that we should not be looking into individuals, but what about departments? And as BigBoss pointed out, how much of the new raise is going to execs?
Pocket the protocol (Pokt DAO) needs to remove the reliance on PNI and to do that we need to focus on the top engineering talent. SendNodes has adjusted equity twice since its inception 9 months ago. 64% of the equity is owned by people that can get down in a terminal and one very very good designer.
How much of the initial 304,850,000 $Pokt went to engineers? 39.5m to advisors- can any of them code? Also, you’re no longer an engineer if you used to code.
web3 and DAO’s exist so that we don’t have to deal the bureaucracy and can let the cream rise to the top. What I’ve seen some individuals do here in the DAO is management. I’m sure PNI financials were shared earlier, more than a handful of individuals would be able to make sense of them and make adjustments. Hopefully they would get paid…from the DAO.
So now most feel that PNI is too big to fail and they are the only ones who can complete V1. Why are PNI engineers the only ones working on V1? Why are they the only ones contributing to the portal? How do we get our best engineers working on our biggest problems?
Compare Pocket Network to an NBA organization. You’re not actually in the game unless you’re an engineer. So for PNI and Pocket the protocol, who do we put on the court?
*Fun fact: Pocket the protocol hit a market cap of 1.7b 12 months ago which is the same value as the Charlotte Hornets.
Michael, Arthur and Lax are great, but you’re not on the court. You’re the owner/head coach, general manager, and assistant coach (very important to the organization). But on top of that, you have 5-10 different coaches (the DAO) behind you doing analytics and strategy.
Some of you may argue that LeanPOKT and Geo Mesh have nothing to do with this proposal and again I would disagree. How can we move forward when our best talent is not being rewarded?
People join DAO’s to get compensated in native tokens. No credible DAO should be paying out majority of its funds USD. It really irks me that we are trying to be pioneers in web3/crypto and the corporation that we are looking to move us forward is so reliant on money in the bank. And if you think this doesn’t correlate to token price, you’re wrong.
Again…our best engineers should be paid in $Pokt. No more 4 year vests. 1 year is crypto is 3 years in the real world. The best devs, designers, and project managers contributing the most efficient code should be paid in $Pokt monthly. Once you’ve proven yourself to be an extremely valuable asset to the organization (Pocket Protocol), then you can sign a long term contract. 3 years, 5.4m $Pokt, 150k $Pokt/month for example.
Pokt DAO brings in close to 2m $Pokt a month, not to mention 120m in the treasury. We need to figure out how to spend that on the best engineering and UI/UX talent monthly. The results will follow.
One could argue that if price gets to 30-40 cents that 150k/month is way to much. I’d argue the opposite. The players make the big checks as they should. In return we may eventually get to a 7b valuation or the same price as the most valuable NBA organization the Golden State Warriors.
If I come across as a dick, my apologies. I only mean to be direct.
I am hesitant to support this proposal with a one-time chunk of 45m.Too big to fail? Perhaps. But what’s going to change moving forward? I feel like there should be milestones that need to be met before more pokt is unlocked.
I want to take the time to create a thoughtful and comprehensive response to the proposal. I have read all the comments, wrapping up some conversations with key stakeholders in the project and writing a response to reflect my current best ideas.
I’ll do my best to get it posted shortly. In typical Sevi fashion, grab a coffee or a glass of wine and enjoy the long read .
Isn’t this because PNI’s resistance to getting external core contributors into some of the most fundamental points in developments?
Or another way of putting is, are “community contributors” designated to “react to what we do” still?
I haven’t been paying as close attention, but when I was, it was very difficult for anyone but PNI to be the ones actively driving the protocol.
Is this still the case? If/yes than it doesn’t feel good using that argument, it feels like low-key strong arming.
But it is the reality of the situation. Just be aware how that argument makes your eager community members feel.
The alternate reality is likely to cut staff more and “rely on community more”, which just shifts the leverage to those people who will also have their own flavor of strong arm (reference large price tag proposals that “save the day”)
And that will not likely get V.1 sooner.
So you’ll have to support this proposal in some way or else you risk all of your investment going to nill. Yay
I think its fair for new employees to preserve their anonymity, but I am definitely curious about how much of the 15M is going to “re-up” people (such as, but not limited to, the founders & O.Gs, execs) who have already gotten large allocations.
It would tell a lot knowing that.
Without disclosing.
How many current staff members does 15M re-up? A range is fine
Are there founders/previous large allocations folks in that?
How many future hires does 30M get? A range is fine
Where is the headcount today?
Where do you expect the headcount to be during this next 12-24 month hard market?
Seems like if pocket is going lean on staffing, then the 30M can be reduced some to appease the DAO and revisited later.
And if the 15M includes founders/ O.G whales, maybe they can defer to appease the DAO as well.
Lastly. If this goes through, what happens to the 15.3M POKT on PNI’s balance sheet?
Is that now free’d up to add to a raise , or is this still earmarked to increase the total employee pool?
Before I get too deep into this, I want to preface it by saying a few things.
This is my CBI. This is my current best idea, and could change in five minutes but I’ve spent countless days thinking about this proposal, exploring the options, chatting with my clients and spent time on a conference call with O’Rourke and Laxman. Early in the fund raise effort, post SOTU Addison and I had strongly considered participating in the equity raise at the PNI level and thus I do have a nice view of the issues we all face as an ecosystem. Over the past few weeks, we have had in depth discussions with our Institutional Clients, some folks part of the DAO leadership team and some folks at PNI.
I would like to also add that I strongly believed we should have let the banks fail in 2009. I strongly believed that we should have let the airlines fail in the summer of 2020. If you can’t manage your own balance sheet, then you do not deserve to be rewarded for malfeasance. These are exceptions to this rule, and in 2009, those loans were all paid back and the government actually made a profit. While this doesn’t change my opinion, the structure of these bailouts were done in a fashion that I can live with.
My response here does take into account several comments and as a community participant, I appreciate them. I do not agree with them all but I am hopeful that my comments and suggestions below, redirect the initial request into a comprehensive package that not only benefits PNI but benefits the entire community as a whole.
For those that are not super clear, this project needs a bailout and without the bailout, we will undoubtedly have a financial crisis of 2009, an airline crisis of 2020, where the underlying entity will simply be finished. While this is my opinion, “I’ve seen this film before and I didn’t like the ending…” This bailout should have strict guidelines, and mandatory results. Anything short of total execution, should have consequences. In this particular case, given the structures we find ourselves in, the consequences need to be that everyone in this community, everyone in the DAO, fires PNI.
I have found the DAO to be totally dysfunctional. That being said, I have complete faith in Dermott, Ben, Nelson, Jack to steer this ship in the right direction. They are not to blame for the dysfunction, all of our DAO members are. We’ve been sloppy, we’ve allowed for total inappropriate behavior to be considered acceptable. We’ve pushed away builders and the lack of family and community support, is frankly, disappointing. Background checks on builders, disinformation campaigns, public insults, and more or only a small chapter of our history and this has to come to end. The only way this community of builders is going to get POKT to where it needs to be, is to change our methodology in how we produce work and it needs to be changed in “orders of magnitude” to be successful. I have seen a few films before, and I did like the ending. We are 100% capable of achieving the success we desire, with some sound leadership, direction and plan.
PNI - The buck stops with the CEO. Period. Michael has made some terrible decisions at the expense of this entire project. He is trusting, he is loyal and for these admirable qualities, his previous team were simply unqualified at any level to manage this balance sheet appropriately. To go into these details would be a bad use of our time but we know the PNI made an abundance of errors and many of them are stated above.
For me to support this ask which Laxman truly does need to recruit and keep top talent, I suggest the following.
P NI needs to reduce their headcount by 50% by Feb 15th. They have already reduced staff by 15%, plans for another 15%. I suggested to Laxman that there are further cuts to be made. PNI can always hire back if they’ve trimmed too far. Rip the bandaid off and do it as soon as possible.
This will dramatically extend their runway and with increased demand, could get them to break even sooner than later. The burn rate should be near or around 300k a month. To me, this is non-negotiable and if I was in Michael’s position, this would have been done six months ago. If any of you doubt this, I did speak to Michael last April, May and June and pleaded then for this action. I have done these layoffs (once) and they’re not fun BUT they work.
The DAO proposal to be refined to include this key performance metrics as part of the grant.
There is a board being built. This board at the PNI level should be commensurate with the funding of the 45m POKT. There are currently 3 board members (I think). Michael, Laxman and one Institutional investor. Add 2 more immediately. One that represents the builders and community, and one more who might represent a lead investor in their equity raise.
PNI - issues 20% of the PNI equity to board members, employees and future employees with a profit sharing plan. The vesting option to the employees should not only be POKT tokens. This would allow for employees to recapture loss wages during this economic downturn.
Employee reduction can come from:
i. Dev Ops
ii. Backend
iii. Frontend
iv. Quality
v. Design
vi. Product Management
A bare bones skeleton crew to maintain v0 to support 3b relays per day.
Start over with a very lean group that is incentivized with a moonshot task. Like the rest of us, this will require 24/7 hours. Without this commitment, we’re dead.
Laxman and O’Rourke both serve as CEO. Let me clarify.
i. O’Rourke is the founder, always the founder and has a unique skill set. That is to create demand, he is excellent at it and this turn around story will be part of his legacy.
i. Biweekly AMA with community blockchain operators
ii. Bi-weekly AMA with ecosystem CEOs, Polygon, BSC, ioTEX etc.
iii. Active twitter and spaces
iv. AMA with institutional funds (over 60 institutions have invested or own POKT tokens.). Calls with them and their respective communities.
v. Over and over and over again
ii. Laxman serves as operational CEO for the next 8 months.
This separation of title is only that and only for the interim. There is no reason why Michael should be dealing with layoffs. That has to be the most painful dagger for him to deliver. We need Michael to be our demand leader and it is almost possible to run layoffs and demand growth simultaneously.
Once Laxman does his thing, he reverts back to the COO and Michael truly is focused on demand, which frankly is the CEO’s role. There are several companies with this setup. Salesforce is an example. Two CEOs can be an effective “tandem approach which allows for wider company scope and broader capacity for growth. Rather than one CEO feeling overwhelmed or alone, two can share workloads and ideas to speed up the process”
A question many would ask. With all these cuts, who runs the network? We all will. In addition, the employees that are left off, this transition could provide them a soft landing where they could get paid by the DAO for participating in maintaining v0. While they are looking for new employment, they could earn a meaningful amount of POKT that one day could be much more valuable than their existing paycheck.
i. The DAO is filled with some great builders who are dedicated to the success of this project. They work 24/7, they’re motivated, they are smart and they are hungry. In less than 5 minutes, I could assign dev-ops, backend engineers, front end developers, and designers to the projects from the multitude of teams we have working in the community. This is how we do it.
i. We keep one of the POKT great Product Managers. While I do not know them all, I know of 1 and “that person” would be perfect to help manage the various teams and projects.
ii. The DAO would fund all of this development. We would be taking off 300k a month of burn from PNI for an exchange of a few million POKT a month. Let’s not get particular here, we’ll fine tune and play as we go.
iii. With teams like POKTScan, POKTFund, SendNodes, Ben Van’s group, Coder, Node Pilot, Dabble Labs and more. The talent pool is incredible but the big question that comes to mind is how do we have the time.
We need to change (for at least 8 months) the relay-mint token economics. The node runners are spending vast resources trying to squeeze out 15 more cents per day per node. That is ridiculous. My suggestion and again, all of this is one proposal and we get it done in the next fortnight. Otherwise, every self proclaimed MBA, Economist, Technologist, is going to debate this while we wither way to zero. We maintain the QoS which frankly has always been an uptime and latency issue. The original principal of 150ms. Everyone who runs a node who meets this criteria, receives a pro-rata part of the daily mint. If inflation is 15%, then every single node runner receives 6.16 POKT per day. Period (and we freeze the token inflation reduction program for 8 months). Then, the node runners are incentivized to help each other. We expand on Poktscan’s offering, we expand on Pokt.info, we build a community of node runners that costs us significantly less resources to operate and we put those resources into the above mentioned PNI gaps. We will all benefit from the economics of this effort. We can work together, share infrastructure, work on supporting the lesser chains (but still be rewarded for the effort). This socialization of the mint will bring a QoS that will fuel demand. Together we can improve the quality of service of the network, and instead of fighting over the daily mint, we can focus on growing the demand of the network hand in hand.
i. There has been talk about the need for builders to be funded. I am one of those builders so I am very careful with my words here but again, I think all of this gets wrapped into one big proposal and we’re done with it. As part of the PNI funding, have the DAO fund all open projects that have requested funding and/or projects that need it.
ii. Anyone who receives funding by the DAO should be required to be a DAO voter. Then we can really spin our spending to builders as we go through this transitional process.
iii. Back of the Napkin Math. DAO has 124m POKT. 37% to PNI, another 20% or so to fund all open projects and immediate PNI gap fill. 60 or so million POKT remains in the DAO to fund over the next 8 months as part of this recovery effort. Once all of us are stable, PNI raises money at an incredibly attractive valuation. They use part of those funds to purchase POKT on the open market and slowly over time, pay back the 45m POKT to the DAO. This 45m POKT is a loan, it is a bailout, it is not a charitable contribution. It doesn’t matter if this takes 1 year or 10 years but it gets paid back with an interest rate that is reflective of the inflation rate albeit at a discount of 50%.
The only way this project survives is not only for PNI to make some difficult choices, but we all have to make those decisions. We need to clean up the mess from the past and those are costly. I do believe that if we band together for the next 8 months, someone else one day will see this movie and they want to make a sequel. I honestly have spent weeks thinking about this and I know no proposal makes everyone happy, and this is no exception. There are unknown and unintended consequences from choices we make. This may have several but the only way I could support us providing PNI this funding is for all the above to happen. It saves PNI, it keeps the V1 team, it gives Laxman more authority, it frees up Michael, it has the node runners working together and sharing resources, it has us building additional products that the ecosystem could thrive on. It makes accountability an incredibly powerful feature.I do not claim to have all the answers, and rather than an elongated discussion on this post, a simple yes or no, is all that is needed. If we see more yeses than nos, I will set up a following call, and we can figure out the semantics along with Michael, Arthur and Laxman. We don’t need 50 cooks in the kitchen either, just a handful of us and TRUST. Trust that whoever takes the lead on this, is not a pushover but has the network’s best intention at heart. I think the reward system in this particular case will allow for the biggest contributors to be rewarded. It will allow for the small node runners to share in our resources and I know there are some small guys who run nodes that are damn good. We should be pooling this talent, not slandering it. All differences aside, POKT has the product fit, now we just need a plan that can be executed upon.
Please respond to this with a simple message of support or rejection for a comprehensive all-in-one proposal and if you are a POKT DAO Voter.
hey Sevi - thank you for your post. Mike will be responding directly.
I just wanted to share with you and the community at large an update we had prepared a few days ago, but had to wait until this afternoon to publish due to rightsizing our workforce.
‘Otherwise, every self proclaimed MBA, Economist, Technologist, is going to debate this while we whither way to zero.’
I have felt like this has been a crux of why the DAO has been slow to react, too.
At this point, the company is dead if major drastic moves aren’t made. I’ll refrain from being one of those self proclaimed speakers and simply say that this was clear and precise. It’s the only suggestion thus far that holds actual accountability.
My only fear is that the necessary cuts will not be made, PNI struggles for a few more months and then the protocol collapses forever. I hope the team can do what needs to be done.
There’s been a lot of debate and engagement with this proposal. It is very promising to see. I can see all sides of the debate, and many people have a point. Thanks for summarizing PNF crew.
A New PNI
For me, the change in status from a company that never sought to grow the value of its equity to a for-profit entity intent on a unicorn status of its changes how I see the organization.
No longer should PNI be perceived as a benevolent overseer of Pocket Network, but it should be seen as one network contributor among many. An organization, among many, that is creating and extracting value from Pocket Network. I don’t have a problem with this approach. It enables sustainability for the organization and a chance to succeed if both the network and the company succeed. It’s a worthy direction if the network isn’t already self-sustaining, which Pocket Network is not.
That said, the decision to become for-profit changes how the DAO/Foundation treats PNI. It needs to be treated as another service provider. A first among equals, if you will.
Do they add more value to V1 and Pocket Core than anyone else? Yes.
Do they do all of the sales and onboarding? Yes.
Do they support the only access point to Pocket Network? Yes.
Do they have the future of the protocol hostage? Yes.
Is the DAO between a rock and a hard place? Most definitely.
Should they be the only ones contributing? No - and this moment should be a possible catalyst to decentralizing our efforts to grow and build Pocket Network.
I’d encourage the DAO voting base to think about where we want to go with Pocket Network and the future we’d like to create. Do we want to be an unstoppable hydra or a single-headed organization with a DAO? Should we fund PNI and not other organizations? Why aren’t we enabling others to contribute to v1 I’m hopeful that the new Foundation will be key in distributing work and risk among many different providers.
One more point on this topic, approving this rapidly after the LeanPokt situation feels contradictory. If these parties are on even playing fields, why not treat them as equals? Why shouldn’t Thunderhead or other contributors qualify for the same type of grant?
Incentives
It appears to me that the main point of this proposal is to provide incentives to current and future employees of PNI. The hope is that tokens align their motivations with the success of the network. I think there are good arguments on both sides of the aisle with are worth much consideration, but I’d like to reiterate one point that I’ve seen glossed over made by two other people: equity incentives.
Traditional VC-backed tech startups incentivize and align incentives through ESOPs or similar equity/profit-sharing instruments. This arrangement gives the employee incentive to see the company succeed, aligning everyone’s interests. This typically works very well and would work to alleviate the issues we see here.
In the case of PNI, according to the plan I witnessed Laxman present during SOTU, stock incentives would be highly-attractive to anyone recruited to join the company. PNI will be flush in cash and POKT in the future (according to the model) and can choose to perform distributions to those that share in the company’s equity. With an equity raise of $10M - $30M and a post-money of $50M to $100M, there should be more than enough equity and incentives to go around.
DAO voters cautious of PNI employees not owning millions of tokens each should be comfortable with this arrangement. Given that Pocket Network needs to be successful for PNI to be successful, I’d say there are relatively strong incentives in place with equity alone. By running up to 20% of the network, PNI will accumulate tokens generated by node running that can also be granted to employees on top of equity. Looking at Laxman’s model, there will be plenty of tokens to go around that will quickly amass over time.
Further, the equity holders could reinvest in their success by investing their tokens into the company (and employees). This move may help alleviate concerns about the initial allocations that were granted early on. By digging into their own pockets (150M POKT), they can invest in the future success of their company and show their commitment to their team. I’d be in favor of a situation where the PNI leadership is contributing to the pool.
To summarize, if PNI is a for-profit company, shouldn’t it use its equity to incentivize people to join and stick with the company?
Hiring Plan
I’m a little surprised that there are calls to cut the staff of PNI, but that still supports the proposal as is or in just a slightly modified form. I could be missing something, but isn’t the need for POKT eliminated if they are no longer recruiting and hiring over the next 6-8 months? If that’s the case, we should see a modified proposal that addresses only the need for that period.
I want to see more structure and rigor put into this proposal. If there is a hiring plan, share it. If there’s not, let’s put one together and base the proposal on that.
Sevi’s Post
While I am not in favor of all parts of the post, I think Sevi makes a good point about having controls and processes in place to pay back the proposal in a structured way. If this does proceed without my suggestions, I would be in favor of a system that is paid back over time with milestones and different grant milestones.
That said, dictating many specifics about how that happens in a proposal is overkill. There needs to be latitude with oversight. I’m sure there’s a balance that can be reached with the process, milestones, oversight, and accountability that protects the DAO treasury and enables flexibility for PNI.
Not everyone is keen on the DAO process and thinks it moves too slowly, but I would caution us from swinging 180 degrees in the opposite direction. I can get behind a trusted DAO committee that delegates oversight and implementation, contingent on a vote of the members of that committee. More broadly, I would encourage us to lean into a model that enables small, passionate teams to help execute challenges like this - but the DAO needs to retain some power to help steer the direction of those committees through accountability.
I’ll keep it short and concise. I support this proposal.
Competition is fierce and moving fast. Pocket Network still is in a good leading position for decentralized RPC data but could easily loose that in a blink if things aren’t delivered fast and with quality. While I agree with accountability, clear plans and most of the arguments here… we will all be accountable if such major proposal doesn’t happen fast enough because we’ve asked for several proposal updates & over detailed info. I trust PNI team, they’ve explained the past mistakes and successes, now is time for them to focus on the deliveries to make POKT the obvious place to go to for decentralized web3 data.
I also support ideas around not having only PNI contributing and welcoming other orgs. That should probably be a new topic on its own where we all can exchange ideas while PNI is full on building.
We greatly appreciate what PNI has done. We have a great respect for their talent and potential. We support the well-being of PNI, now and in the future. However we have some reservations about this proposal as it is presented here.
The lump sum payment is not ideal. We can understand/support the ask for the first 15M for current employees. They are working hard to make v1 a reality. Incentivizing them for the success of the network is in everyone’s benefit. But we are puzzled with the remaining 30M. It is for not-yet-known future hires, and it seems premature. Furthermore, we’d also question why so many new future hires are needed for a product (v1) that is closing to a completion, in an era where tech companies learn to do more with less. If, for some reason, PNI is unable to sustain its operations organically and DAO must weigh in to save the day, then it should be done through multiple smaller and incremental rounds instead of one bulk sum of 45M tokens.
Such large awards usually have performance goals / checkpoints. I’d like to see more accountability. How can the community know that the right things are happening thanks to their contributions? What are some of the checks and balances for effective use of such a large grant?
DAO to PNI is still the same small community, and moving funds among them doesn’t really solve any long term problems. We need to grow the whole ecosystem. In this regard, PNI has a unique advantage/privilege: being able to sell network traffic. An air-drop like this disincentivizes them to try hard. We understand that customer acquisition cost time and money, and would love to help them to offset those costs. I would support a specific proposal to help them out with those efforts (new hires if needed, new marketing budget, etc.).
As much as we love and respect PNI, we wouldn’t vote yes for the proposal as it is presented now. That said, we are willing to support PNI in a modified proposal and/or with other means. They are a huge value for the ecosystem, and we want their well being. I am sure they are already working on a better deal for everyone with all the feedback that was received in this forum.
Before I respond, let me first state the amendments we’re making to the proposal:
Lowering the asking amount to 30m; 20m for current employees, 10m for key hires that are currently in motion
Unallocated POKT will be held in escrow by PNF
Quarterly reports about allocated and vested POKT – you will be able to track when this POKT is unlocked
I want to be clear to everyone here - I don’t want anyone thinking that this proposal is being forced through or else PNI, or the protocol, dies. This isn’t a bailout. We aren’t going to zero if this proposal doesn’t pass. This isn’t asking for 30m to get V1 out the door. We may have attrition, and it will be more difficult to recruit, but myself and the team will continue building.
That said, it obviously does help. Everyone building in PNI (and future builders) deserve more POKT, and that’s a fact. It’s up to you to decide whether I, and by extension, the rest of my team, can execute on our roadmap moving forward.
Objectively, everything has improved over the last 6 to 12 months despite the price of POKT going down:
Our quality of service has improved from 400ms to a consistent 200ms.
While still difficult because of testing, it has become easier to contribute to v0 and v1 takes all the lessons learned and is magnitudes easier to contribute to.
We have more nodes on bare metal than ever before.
Our flagship product, the Portal, has become faster with a complete rewrite of the backend in Go, allowing us to make changes more easily across the board. Our Partnership API was spun up in two weeks as a result of these changes.
As for our missteps, they all fall on me. I have always cared about the ecosystem more than PNI’s success as a company, but the fact is, we should be building a business, not a non-profit. We over-hired. I misallocated POKT. I chose to be generous with early employee vesting. We are pushing the boundaries on every single aspect of a bleeding edge technology; governance, the way that we work, economics, distributed systems. It’s going to be messy. And yes, we could have been better. Notwithstanding these mistakes, the direction of change has consistently been up and to the right, since our inception. The best we can do now is acknowledge, learn, and not make these or any other avoidable mistakes again.
Related to this proposal, I understand that we are setting a precedent for future funding of organizations within our ecosystem, which introduces risk to the DAO of being looted of its treasury in the future if multiple organizations follow PNI’s lead.
PNI should not be considered a special entity when it comes to a grant that incentivizes employees and contractors of companies. However, we are currently the core developers of the Pocket Network project – we’re building v1, driving the majority of growth to the protocol, and building much of the core tooling – and we have committed these funds to a standard program of 4 year vesting packages to current and future employees. We are committing to transparency about how these funds are allocated, with quarterly reports about allocated and vested POKT. These funds are not going into a black box.
It is reasonable that as founders of Pocket Network, and as the core developers of Pocket Network, we would be trusted with a larger sum. So, as to the risk of precedent and future looting of the DAO treasury, I have faith that the DAO will be prudent about its allocations of future POKT and allocate large sums only to entities who hold the same level of responsibility and who have earned the same trust.
Now that PNF and PNI have split, this makes PNI like any other company in the ecosystem. Any future grants that we submit from the DAO will be for open-source public goods that we build and maintain, just like any other contributor, according to the same set of rules. This solves several concerns by aligning PNI’s incentives with the community and enabling continuous incentives for everyone pushing this project forward internally.
With all this said I want to address some of the points made in the comments above:
We have lacked the processes to integrate and support external core contributors in the past. The process has always been difficult, and given the nature and priorities of what the protocol team has to do, it has required deeper knowledge to be able to contribute in the first place. Another challenge is that the tendermint codebase has many nuances that, unless you’re deep in the weeds, you won’t catch right off the bat. There is a lot of missing context to learn as to why design decisions have been made.
Now that we have established a process, it has become easier to contribute to V0 over the last 6 - 12 months. We are designing V1 from the lessons learned over these last 2.5 years. We’ve already had multiple external contributors to V1 at this point - because it’s significantly easier.
Laxman’s point doesn’t have anything to do with external contributors. That has always been an independent process. We made the decisions with POKT vesting based on how we felt we had derisked what we had built at the time.
We have done all of this. From q4 last year, everyone began being evaluated on performance and we gave everyone in the company equity. Our salary burn is around $400k, a full 50% cut from where we were. We have the bare minimum across frontend, backend and devops. We will continue to keep our protocol team as is. If we cut more, things will break. When it comes to infrastructure, people only notice when it breaks. We don’t want any of the applications using Pocket to be in that position. It’s much more difficult to gain a customer back once you’ve lost them.
Our largest spend is in infrastructure, and we have an aggressive plan to move as much as we can from the cloud to baremetal and outsource the altruist system to the existing network of nodes. This is the highest leverage move we can make at this point. This does not happen overnight, and everyone we have on the devops team is all hands on deck to either migrate our infrastructure or launch new chains.
I think it’s important to emphasize that PNI is not a one man show. We work closely as a leadership team and I have full faith in Arthur and Laxman to make the right operational decisions for us to steer PNI towards the vision I’m setting. That said, we all have our own part to play and I believe the leadership team we have built today can get us where we need to go.
This is a completely separate proposal. I do believe we need to be more aggressive with reducing inflation, more so than SER (will respond accordingly there as well). We are preparing another proposal to bring inflation down further. Incentivizing the network to move to a predominantly bare metal or owned infrastructure setup is what’s going to help us in the short term and long run.
Several people continue to speak as if nothing has changed. We laid out our plan at our State of the Union event in November. We’ve laid out our roadmap with each function. We have clear goals and deliverables. We’re actively working with the community to assist us across the board. Arthur laid out all of this in his post. We just need to execute. PNI and the project will survive.
Judge us on our execution now and moving forward, not the past.
Our mission has always been to enable as many people, organizations and developers as possible to build on top of Pocket. This has never changed. We would not have the ecosystem we have today if that wasn’t the case. We have continued to move in the right direction. Now that PNF has been empowered by PIP-26, Pocket will never be a single-headed organization.
Yes, there are equity incentives for everyone in the company. The glaring hole that this proposal seeks to fill is the incentives with the network. PNI doesn’t succeed unless the protocol succeeds, and it’s important to align those incentives properly.
I have amended the proposal to reflect everyone’s comments here. I hope this is sufficient for the community to move forward with.
To wrap up, thank you for all of the feedback. There is no playbook for anything we’ve accomplished over the last 2.5 years, and I continue to be impressed with everyone in this community.
At the end of the day, I continue to be beyond ecstatic about what the future holds for us.
, or is this still earmarked to increase the total employee pool?