A Builder's Dilemma in Arbitrum

Repost of a thread I originally shared on Twitter/X. Sharing on the Arbitrum forums as keen to hear some more perspectives!

Convince me otherwise: builders start off highly incentivized to participate in ecosystems and their governance systems (Arbitrum, Optimism, etc.) but over time see their ability to do so diminish over time.

Builders are initially deeply incentivized to build within ecosystems to establish themselves, drive app demand and activity and, at times, launch entire new categories. Participating at this stage = simply building (ie. what you do best) and you’re typically rewarded early on, enabling you to participate in the next stage of an ecosystem’s progression – through governance.

Over time within ecosystems that are DAOs or have some form of governance, builders naturally become disincentivized to participating in governance. After all, we’re in the business of building – not governing, building frameworks, drafting and iterating on proposals, hopping on governance calls, discussing in delegate chats or governance forums, etc. We are (or should be) more focused on finding PMF, shipping product, managing and aligning teams, marketing, fundraising, partnerships, monetizing, and driving towards key metrics (user growth, activity, TVL, retention, etc). Some builders do find a way to meaningfully participate or adjust their organization to accommodate this paradigm shift but it’s still an uphill battle and investment (that might not see any ROI). Time is a precious, finite resource and builders have their own set of objectives and constituents to serve – all of which are situated within said ecosystem. What starts as one full-time job (typically already more than that) turns into two or more.

At the same time, ecosystems need to grow and what’s a clearer (easier?) metric of growth than acquiring net new builders? This leads ecosystems to tend towards incentivizing newcomers versus supporting existing builders who make the ecosystem. Big, bold, and concerted bets don’t tend to be made in these ecosystems for fear of kingmaking (valid concerns). So incentives are broadly spread to be fair and inclusive, and it generally favours those who are able to spend their time participating in governance or marketing themselves and not those silently building or delivering results. Applying a venture comparison, the result = ecosystems end up indexing on a great deal of 0-1x opportunities and shying away from those that they could meaningfully support to become 10-100x (which feed back into the ecosystem’s flywheel).

So established builders end up facing the following dynamics:
• :balance_scale: Balancing a need to spend time building vs. participating in governance. If you want to have a voice, you’re fighting an uphill battle amidst a growing base of governooooors able to spend much more time than you can within governance. Your fate/position within the ecosystem becomes increasingly being determined by others unless you invest time and capital in this effort. If you stop paying attention for a bit, you’ve got to figure out how to navigate a web of new participants, programs, structures, and processes. Within DAOs, you also have the occasional academic/theoretical pontification that occurs which, put frankly, not all builders have the time for.
• :flashlight: With crypto moving at a breakneck pace, new projects often take the limelight. And shiny ones who capture metas/narratives are the flavour of the day/week. Existing builders who drive outsized impact and results are left backstage, standing by to see if anyone recalls what they do / have done for ecosystems.
• :crown: Attempting to advocate for oneself often interpreted as self-interest and concerns of kingmaking / monopolies arise. Combatting these perspectives take, you guessed it, more time.
• :no_entry: Conversely, not participating also puts you in a negative light as well. Established builders who find themselves with governance power are thrust into assuming this role and are subject to high expectations from the ecosystem to actively participate. “Not active in governance? Well you don’t deserve to be here!”

This is a long winded way of me (i) sharing the builder’s dilemma that many of us face relating to the ecosystems that we are actively building within; and (ii) attempting to gather perspectives from others. Decentralized ecosystems and governance are still a grand experiment being figured out, each with their own flavours and culture. As this happens, I implore those attempting to shape and structure governance systems from the ground up to put yourselves in the shoes of the builders and support them throughout their journey.

At the end of the day, the thing we want to do most is build while being recognized for our contributions. In the wise (paraphrased) words of Dory: “Just keep building, just keep building…”



This is a difficult question, since the initial funding is done to support the creator at the initial stage so that he can show that his product is good and useful. Further, if the product is good, it has the opportunity to develop without the support of the DAO.
On the other hand, the longer and more support there is, the faster the project can grow.
Therefore, I think that I will have to devote a lot of time to the DAO and submit appropriate applications for funding.

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