Thank you all for the thoughtful questions and comments! I’m grouping them by topic as follows:
The Interim Expert Council
Jojo, I really understand and appreciate what you are saying. In many ways the CEO approach is not too different in the sense that someone should be able to frame the CEOs mandate and objectives, and they need to be kept accountable and supported. The CEO doing that directly to the DAO, without a commissioned high context and accountability stakeholder group might not produce the best results.
This is what the Expect Council is meant to address and I think it’s the key enabler we should put the priority on.
That’s a good question and is still open for discussion with stakeholders in the DAO. Our thinking so far:
- At least one of the top delegates that has a propensity towards the venture topic. Those would understand the DAO and its dynamics well and the different players trying to impact or benefit from venture investment.
- At least one senior representative of a major professional investor into Arbitrum / OCL. They have an incentive alignment toward the success of the ecosystem and the Arb token and relevant expertise, so can have the right critical view.
- Possibly an external domain expert if we identify a gap and a good fit for such.
The interim investment facility
It’s important to differentiate between the fully fledged long term investment mandates and the interim capacity.
The former is the commitment to make certain investments with a well considered financial return thesis, fund model, etc, where the latter is not. Just the capability to do so if really necessary before the long term mandates are set up.
The former will have very clear KPIs with a systematic portfolio approach, where the latter might not, or not in the same sense.
It could take the form of investments that may end up incongruent from some points of view, but address the relevant concerns about balancing long-term ambition with short-term pragmatism—focusing on smaller, quicker wins to complement goals with longer-term payoff. You can think of that as a short term mechanism comparable to what might otherwise be structured as grant financing, but providing more control and stake for the DAO. E.g. it may be a way to enable a very critical technology infrastructure provider, while the DAO manages the risk via participating in the governance of said provider and makes an ultimately more fair deal.
All of this still needs to be fleshed out a lot more, which will be a subject of a separate Snapshot before it goes into the same or separate Tally as the proposal described in this post.
About Farstar
Thank you for bringing this up. We’ll prioritize bringing this information forward and will make a separate post on that. Stay tuned.
To give a taste Farstar was set up about 7 years ago by me as a wrapper to amalgamate a number of initiatives and a collective of contributors that have been doing similar work together since as early as 2008.
We are mostly builders and investors who got involved with startup ecosystem development efforts mostly out of passion, but later got into various official advisory and capital management roles on behalf of governments, corporations, major institutions, or private investors.
It’s important to note that Farstar hasn’t been set up to have ongoing operations, but rather as a platform to mobilise teams around specific opportunities we care about. Such as the one with Arbitrum here, around which we see great potential for impact that we still need to elaborate more on. Under the current structure we’ve had over 100 vetted contributors formally engaged in our programs, giving us a very deep pool of talent to tap into to meet emerging challenges. We’ll highlight the backgrounds of the ones so far involved with AVI, as well as relevant previous work in the upcoming post.
The Budget and Operational plan
These will be detailed in the upcoming Budget and Operational Plan deliverable of the AVI pilot. Thank you for raising these questions as it helps us respond more clearly to the various considerations. If there are more specific ones, please share them as well.
Treasury management vs Strategic Investments
Treasury management and AVI have distinctly different objectives. One is related to putting the capital to work in a relatively safe way towards generating positive cashflow and growth of the balance sheet. AVI has to do with supporting builders and ecosystem development, while at the same time doing that in a financially sustainable way. Not necessarily bringing the proceeds in the treasury, but recycling them towards ecosystem growth.
Exclusivity
cp0x, the contractual exclusivity terms proposed are one directional for the benefit of Arbitrum DAO, not the other way around.
This should have been expressed more clearly as it looks like it didn’t come across for multiple people. If the contract gets continued in some way after Phase 2, we are committed to offer an option exclusivity terms going forward too. There can be a right of first refusal agreement embedded at this stage as well.
We recognize this concern and it is the reason we set up AVI as a DAO originating initiative open to other contributors besides the people around Farstar. We’ve put a lot of thought in the direction of how to facilitate a genuine effective in-house solution for the creation of the CapCo (which is what this proposal is about). That being said there is a lot of nuance and need for getting in the details and we need to get the right stakeholder group engaged to delve in.
No, not yet, this would be subject of the contracting on the back of this proposal.
In terms of resolution of disagreements, this is generally something the AF is mandated to facilitate, however having the Expert Council would also be a part of this process.
Capitive VS Non-captive
Managing such considerations on an ongoing basis will be the core function of the management team on FoF. We have some of our thoughts about the complimentary nature of the two articulated in a forum post that can be found here.
Comparison with the GCP
When we refer to the GCP we mean something very specific. Namely there is a lot of uncharted territory in terms of how to implement investments out of a DAO with an onchain treasury. After 6 months of work from the team there, AF, council to set up the legal structure and bylaws, it gives AVI a flying start by building on top of it.