A dedicated community manager to attend the events and engage 1-1 with participants, build relationships, facilitate introductions, etc.
please note these are not only admin costs. Compared to a regular grant program, the proposed programs include a significant dose of support (mentorship, workshops, training, etc.) which is critical for early-stage projects. I imagine these concerns are mostly related to OV and EVM Capital as we (RnDAO) already provided a detailed breakdown in our proposaland you mentioned support. So Iāll ask EVM and OV to provide further details (or please correct me if Iām wrong and youād like to see more from our side).
Iād like to understand the concern better here, please. The proposed programs feed into each other, and thus have no overlap but are complimentary. Then, thereās a potential issue of just not having enough quality projects in Web3 that can apply, but weāre already addressing that with the RnDAO programs which lead to new, quality projects being created and can thus feed the pipeline. There will be some calibration needed and potentially scaling the RnDAO programs to feed enough volume for later on but itās hard to gauge this in advance so weāre starting with a relatively small size for RnDAO (10 ventures) as a minimum amount to be statistically significant.
Taking the above into account, am I missing something in your comment, please? Does this address the concern or is there another angle Iām not understanding?
I appreciate the concern here and Iām trying to think through how we can address this well. The challenge I see is that although building the ecosystem of apps/protocols on top of Arbitrum is critical to developing Arbitrum as a leading ecosystem, it takes significant time for said apps/protocols to mature. So we can include transaction fees for example, or the number of wallet/users for the apps/protocols that are created, but likely it will take 1-3 years before we can fully see the results (i.e. the best indicators are lagging indicators). So weāve proposed mostly leading indicators that can show some traction of the ventures (e.g. revenue, fundraising, etc.). This situation doesnāt mean that incubating early-stage projects to grow is not valuable, but Iām not sure how to address the lag in impact indicators other than through good risk management (oversight committee that can stop funding, 3 different operators for decentralisation and some healthy competition, quality teams). Iād love to know if you have any ideas how we can address this.
Agreed, weāre proposing to setup an Oversight Committee on behalf of the DAO to review progress quarterly and approve the disbursement of payments. So we, the operators, wonāt receive all the funding in one go.
Iād love to understand what youāre referring to here. We can setup some contingencies for price drop (a certain āreserve budgetā that can only be used if price drops below a % (e.g. if drop of 10-70%). And the programs get cancelled if it drops more than 70% for over a week.
Is something like this what you had in mind or what would you suggest please?
We found it helpful for the delegates to see how the programs feed into each other and how theyāre all complimentary towards the objective of developing a thriving ecosystem of apps/protocols on top of Arbitrum by making it the best place for builders to create commercially sustainable projects.
Weāve also added a small budget for coordination across the programs. That being said, this has been a difficult decision with pros and cons for both approaches. Would you recommend us to propose separately?
While $10 million is a substantial amount, it is essential to note that these funds are distributed among three independent operators, which helps diversify risk. We also acknowledge the need for proper risk management and have proposed an Oversight Committee to provide high-context and high-bandwidth oversight. This committee will have the authority to approve, stop, or modify payments based on the execution of the programs.
We recognize that the proposal may not have detailed this mechanism extensively. Do you believe this oversight measure is sufficient, or do you have suggestions for how we could improve it?
Could you please clarify what you mean by this? Our intention is not to overshadow smaller contributors, but to establish a strong foundation with our initial partners. The three programs we are proposing will serve as a first cycle, and we welcome other innovative contributors to join subsequently. We aim to lead the way as a starting point but are open to including diverse participants in the future.
Is there a specific aspect of our approach you think could be improved to better support smaller contributors?
We share your concern about sustainability. All three operators (Outlier Ventures, EVM Capital, and RnDAO) are committed to continuing our engagement with Arbitrum beyond the proposed Q4 2025 term. We plan to propose another cycle based on the results from the first 6-9 months to prevent discontinuity, provided we demonstrate healthy progress to the DAO.
However, we are open to suggestions on how we can better address long-term sustainability in our proposal. Is there a specific approach or plan you have in mind that could enhance our sustainability strategy?
We want to first thank @aminiman and @danielo for their effort in bringing forward this proposal and communicating to address the questions from fellow delegates.
We have been in favor of continued experimentation and investment in the Arbitrum ecosystem and community through creative frameworks. This proposal is another example of an innovative idea on how the Arbitrum DAO can impact developers and those looking to expand the Arbitrum ecosystem. With that said, the DAO has also continued to struggle to appropriately allocate funds with regard to operating costs and reasonable requests such as the recent Catalyzing Gaming proposal where $25M was set for operating costs. This spending is unsustainable, and we must first execute and evaluate current funding initiatives to understand what costs are necessary and the best frameworks for continued incentivization of growth on Arbitrum.
This proposal has a lot of the right ideas, aligning with attracting new builders and ensuring current developer retention, but we agree with previous concerns that the current costs do not present a compelling opportunity for the DAO. Some specific issues with the proposal:
We appreciate the suggestion to create an Oversight Committee to ensure risk management, but the creation of another committee guarantees additional costs unless this is already included in the āAdminā costs.
While there are significant processes that come with this undertaking, we do not see the DAO needing to step into the role of incubator, given the early signs of success with incentive programs and the continued experimentation underway such as the pilot for the Arbitrum Ventures Initiative
We look forward to continuing to work with the incredible group of partners that delivered this proposal and continuing the conversation, but we do not feel compelled to support it in its current form.
We appreciate all the effort, thought, and time that has gone into this. In saying this, we find it hard to justify the requested spend on behalf of the DAO.
We spent some time speaking with Daniel from RnDAO (who was extremely helpful and open) on their previous proposal which seems like it has now merged into this. But unfortunately, we struggled to agree on their outlined costs, the vision of CollabTech, and structure of the program. We understand there is a large market for CollabTech outside of Web3, but it is not clear to us that such demand exists currently as indicated by the lack of market, products, and results from the pilot phase. We would be more comfortable voting in favour, if the research and market analysis was funded with a small budget that delivered a clear scope of verticals where the rest of the resources were focused on (i.e., community building activities, vc investments, EiR RFPs). Their market and research model which is responsible for the delivery of market opportunities that direct their EiR programs also ran for the full length of the program which did not make sense to us as it should happen at the very beginning of the program or worst case, right before their last incubation cohort. Lastly, we found there to be a lot of double-dipping in team salaries across most of the modules leading to higher than necessary costs.
For the remaining parts of the proposal, we echo much of the same concerns others have mentioned - high costs and the potential for overlap in resources which leads to overspending. When thinking about the longevity of the program, firstly, this is a very expensive pilot, and secondly, most of the costs & benefits are heavily concentrated on the short-term (discounting successful incubations). So how do we ensure there is a longer-lasting benefit in line with ThankARB post-Infinite Launchpad? One suggestion is to have a portal that collates a lot of the information that is provided to EiRs, incubation projects, supporting material etc. This allows the DAO to assess the quality of information, provides a clear deliverable, and allows future builders to leverage material from this program.
Thanks for your feedback @AranaDigital . A few comments to clarify, Iād love to know your thoughts after.
An oversight committee does create some costs (about $150k/year in our case as the programs are self-sufficient and the committee is just for oversight not for executive capacity). This is not a very significant cost for the DAO (a fund would easily spend 2%+ on management fees which for Arbitrum is $60mn year). That being said, I do agree oversight costs should be managed and reduced whenever possible!
Our current thinking based on the feedback so far is that a temporary oversight committee can be setup and as soon as a more robust structure is in place (e.g. AVI) then the temporary committee is replaced. That would ensure that the DAO is not paralysed and at the same time costs are not duplicated. Would this setup (pre-empted transition) address your concern?
The design of AVI is one where it would be the vehicle that oversees multiple programs such as the ones weāre proposing. AVI is designed to deploy capital into the programs we put forward (equally AVI without programs to oversee is pointless). In that sense, these initiatives shouldnāt be viewed as competitive but rather as different pieces of the same puzzle of building the greatest innovation ecosystem in Web3 and beyond.
Iād like to understand why you believe Arbiturm shouldnāt act as an incubator. My thoughts: I see a risk with incentive programs and not offering a path for builders to repeat what happened in Canada with supermarket chains. The Canadian gov wanted to fight international competitors so they gave incentives to the already mature supermarkets, which grew a lot as a result. But soon very few players ended up controlling the market, stifled competition and raised prices, later forcing the Canadian government to give incentives to foreign supermarkets to enter their market and stabilise competition. Incentives can be counterproductive, and even when theyāre not, their impact is often short-lived (especially in Web3) as they attract not organic users but airdrop hunters and speculators who quickly move on to the next shiny thing when we stop paying them.
This is not to say that incentive programs are always bad, but theyāre best viewed as part of a mix. To give the best chances to Arbitrum, itās best to not focus only on gaming, nor focus only on mature projects, but support a variety of projects across a few verticals (business clusters). As long as said support is executed well, these activities will give high ROI to Arbitrum, providing more funds to incubate more stuff (or give more incentives). Iād argue that at this stage, Arbiturm shouldnāt discount incubation, one of the most established mechanisms for innovation.
I understand the Gaming Catalyst proposalās large budget was a very significant ask (200mn) but then thatās over 3 years (potentially not used completely). And thatās still only 0.6% of the treasury. Weāre currently working on projecting the ROI, as Arbiturm has already generated over 16k ETH in sequencer fees (over 3k ETH in the last 5 months so over $10mn). This significant revenue makes us bullish on the value of Arbitrum investing to sustain and expand its leadership amongst L2s, especially at a time when competition is rapidly increasing. And we see incubation as a powerful mechanism to invest (not as an expense but as an investment) into growing sequencer revenue and making Arbiturm the best place for builders.
Iād appreciate a chance to hear how the above is landing with you and any remaining concerns (or some further understanding on the ones you shared), so we may find a way to work with Arbitrum and grow this ecosystem together. Thanks in advance
This proposal uses a lot of big words and long writing to say "Give us $10m so that we can invest it.
Unclear how this helps Arbitrum as the deliverables (comprehensive support, developer mobilization, developer feedback, etc) are so loose and unmeasurable. Additionally, the teams lack experience of running these programs that are worth $10m.
I think there are two very important misunderstandings here.
RnDAO is operated by a small team, as such we wear multiple hats. Thatās not the same as double deeping, simply our time is divided across multiple activities.
For example, Iām scheduled to
do some work organising hackathons, hosting talks, etc. (community building. About 10% capacity),
work with the ventures (Venture Support, 40%),
do some overall management (Admin, 30%),
and Iām also contributing to our thought leadership and research (20%)
Combined Iām getting significantly less than an Accelerator Program Director would get ($120k for me vs an average market salary of $150-$250k/year), while my role has even more responsibility.
Or take Drea whoās dividing her time between coaching the EiRs (EiR support 55%) and overseeing Market & Research (45%). She led research for Google Suite, Asana, and Aragon before joining us, and could get a salary of $200k+ but weāre charging her at $90k year.
Our costs are significantly lower than average because the model weāre putting forward is an improvement upon traditional entrepreneurship programs and thatās what drives us, using this opportunity to reinvent how ecosystem development and entrepreneurship are done. Financially any member of our team could get more at a regular job.
The pilot of the Research Fellowship (now EiR program) actually yielded multiple products that are in development. Thereās a natural delay to translate from research to a revenue-generating startup, but we can showcase the impact already: Milea who completed our fellowship has gone on to receive a Questbook grant to build CollabBerry and has multiple teams that are already migrating to use her super basic prototype, while market research shows thereās a way larger opportunity for the tool in both Web2 and Web3. Meanwhile, because of the inability to get funding from Abitrum, we lost two fellows who moved to Cardano and Optimism where they were funded and are building solutions. As such, half of our fellows have already raised subsequent funding in less than 2 months after our program. Over the next six months, we can expect them to complete an MVP and start serving customers in their home chains and we have two more who have applied to Arbiturm Questbook grants (response pending). Despite the setbacks (PluralityLabs having been unable to provide us the follow-on funding for our fellows as originally discussed), weāve made significant progress assembling teams and launching a pipeline of products.
We were also funded to select and fund one venture (more mature than the fellows) and are excited to be closing a deal and bringing to Arbitrum a web3 OG and very talented developer (ex-founder of DAOStack) and partnering with them to publicly launch an ambitious social/comms product.
Thanks to our Swarm model, the process also led to 4 other quality ventures looking to join the CollbTech business cluster without receiving ARB tokens. And weāre processing these despite significant delays as our attention is focused on engaging with the ArbiturmDAO to give long-term viability to this initiative.
For 156k ARB, weāre showing very significant impact.
We appreciate this suggestion as having robust research feed into the EiR program is exactly what we have intended. Could we consider a proposal with Milestones whereby an initial sample of the outputs of the Market & Research module is reviewed by an appointed committee and greenlighted after two months, thus unlocking the initial bit of funding for the rest?
My concern is that without a mechanism for timely assessment and continuation, the cost of interruption (running a 4 months research, then stopping for an indefinite period to get DAO approval, then having to start preparing for the EiR promotion and recruitmentā¦) can easily amount to a 6 months delay and makes this unviable for us to retain the talent and thus lose critical, tacit knowledge that can no longer benefit the EiRs.
Having the milestone setup does provide risk management for the DAO, while ensuring timely assessment and actioning of the program in a way that the uncovered opportunities are not lost to competitors unencumbered by slow decision-making.
Would such a setup be agreeable?
Could I ask you to clarify where you see this risk of overlap? is it about oversight (Betting on Builders oversight committee vs AVI) or something else?
I quite like this idea. We had puta small budget for cross-program marketing and coordination and this could be one of the deliverables here.
Thank you again for your engagement with our proposal. I hope we can continue the conversation and find a path forward.
I love the general idea of this proposal, but I donāt think we should throw $10M at a launchpad without upside for Arbitrum DAO. So I will be voting against.
I think it could make sense if the ask was smaller and there was a plan to modify it when the AVI and other investment structures become clear.
I am working on starting a launch pad now (q/acc via Giveth), and the profit opportunities for Giveth are insane. They will be WAY BIGGER for Arbitrum. It is worth waiting for the legal set up so that the DAO can get some early allocations in the projects that get incubated in this program. IMO
We appreciate the initiative and see great potential in supporting developers and startups within the Arbitrum ecosystem. However, we have concerns about the high budget request of $10 million. We suggest the following improvements:
Implement a pilot program to demonstrate viability and scalability with an initial lower cost.
Break down the proposal into distinct parts, allowing stakeholders to fund specific components independently.
Given these concerns, we will vote against until further clarifications and adjustments are made.
Blockworks Research will be voting AGAINST this proposal on Snapshot.
Thank you to all the parties who have worked on this initiative. While this proposal includes several aspects that would likely have a positive impact on the growth of the Arbitrum ecosystem, we believe that the timing isnāt ideal, the deliverables and how they feed into each other could be explained with more clarity, and there is a risk of overlap with current as well as to be proposed investment initiatives.
Healthy competition between investment/accelerator programs is naturally beneficial to a certain degree. However, as the DAO is still in its infancy as a capital allocator and the budget is an open question, we believe there is a need to be particularly meticulous with how funds are allocated into investment programs. It makes sense to wait until an adequate overarching operational structure is put in place to better understand where there might be overlap and how Arbitrum will be able to receive financial returns from investments. Lastly, the total cost of this program seems too high to us, and more specifically, the large OpEx as a % of the funding request makes us believe that the cost structure requires reworking.
Thanks for bringing this proposal up, as it sparked a lot of construtive discussions. However, I vote against it in the current format. I believe you guys received a lot of positive feedback that will help structure it in a way that is more palatable for the current sentiment.
I voted AGAINST this proposal at the temp check stage because the overhead (non direct investment) costs are excessively high and because (from what I can tell) there is not a concrete plan in place for the DAO to capture upside/returns from the venture investments made.
First, I will echo what other delegates have pointed out - overhead is a very large % of the cost and there isnāt (yet, as Iām understanding) a way for Arbitrum to recoup those costs from the project to help alleviate that concern. Contrary to the sticker shock ā I do fully believe that the teams have put in effort to cut costs where possible, and this is sort of the nature of paying for this type of experience within the crypto field. I will point out that the DAO at large (presumably, I canāt speak for anyone but myself and my assumptions) would be more open to this if there was any way to cut down costs.
Everything else about the project I see reason to support, it is unfortunate the legal state of Arbitrum does not allow for an easy way to get an ROI on this. I hear the point that this type of thing might be months / a year+ away so itās better to at least get thing started, and I would agree. However given the cost I think this is taking on a lot of risk for things we are hoping will one day materialize.
That said, I do disagree with others that we should just wait until that is settled. The L2 competition is an equally fast and fierce one. Iād like to see this type of network be setup now, as I fear we may start to get behind other networks if we wait too long. The GCP comes to mind, where a lot of money has been thrown at playing catchup in the gaming space.
Where this gets tough is I would like to see some form of this proposal go forward, but I agree with others the cost is just too high. With that in mind I will vote āForā on tally to indicate support for the project itself, however that comes with a very clear statement that if the cost remains the same (or reductions in cost are inadequate) for the Tally vote I will be voting against at that time.
I am getting familiar over time to what @danielo is doing with RnDao.
What I like about him is that he is taking a path I would never take, with an approach I would never had. And at this point I am old enough to understand that even if I donāt agree with something or with a specific mission doesnāt mean there is no value behind, or that it canāt be pursued in ways outside my personal framework.
What is he after, and how, is something I support. And I am also trying to give him a bit of a hand in this sense, starting with the questbook grant for collabberry.
But the current proposal imho just doesnāt properly work. I echo the opinions of, generally, too much overhead costs. This solves either through cost cutting, or increase the amount of capital requested to distributed, and I am not sure what is the right way here.
I am also a bit conflicted on the merge of the initiatives of RnDao, EVM capital and Outlier Venture, that in my understanding initially were separated. I understand how joining forces could be seen as a winning strategy, also how a joint force can be āeasierā to manage for the dao in term of voting, but I am not sold on this, sorry. We have different teams, different personalities, and different scopes.
I also want to highlight that my vote, is not a vote against the matter per se; i am willing to support the proposal the moment in which is reworked (because, I think it can be reworked), and be addressed for the following
overhead costs ā either we lower the costs directly, or we start with an initial smaller phase and a second phase, larger than the one proposed, so overhead is not that big if phase 1 is succesfull
clear scope between the 3 ventures, and properly understand if they have to run in tandem vs solo
(in general) clear scope on targets, what we want to accomplish etc.
@danielo keep working on this, I think you are onto something valuable.
While I agree that we have become the L2 with the highest number of builders and need to find better ways to mobilize them, I believe there are already sufficient initiatives with the necessary budget to achieve this goal. Additionally, I think we are at a point where we need to optimize for revenue, considering our long-term sustainability. This proposal does not provide a clear strategy for the DAO to benefit from the returns on venture investments.
We appreciate all the materials, FAQ and comments to address feedback from delegates, especially shout out to @aminiman and @danielo.
We simply believe it crams all the conceptual ideas into one proposal with a high operational cost without track record or clear and foreseeable deliberables to be proven to the stakeholders in Arbitrum, while understanding the reasoning behind all of them into one. We also believe what to aim to achieve is valid and broken-down initiatives can be considered worth a try. Weād look forward to continuous bets from the team.
This is a really interesting initiative that could definitely benefit the DAO. It aligns with Arbitrumās values, it offers support to developers, provides diversity in terms of programs and promotes the ecosystem as a whole. However, I share a lot of the doubts raised by other delegates above. The size of the grant and operational costs seem very high for something so experimental and that partially overlaps with other initiatives. Some of the points that the program wants to address are definitely areas that need to be tackled, but broken down and at a smaller scale. Joining forces and merging few initiatives together was likely a mistake. I am also not fully convinced of the timeline, which spans over a long period and doesnāt explain the plans after Q4 2025. Overall I think that the project has a good potential but some adjustments still have to be done in order to improve it. Thanks @aminiman and @danielo for proposing this initiative, keep it up!