Voting Rationale: Nov 22-28th, 2024
Snapshot
Restitution For Extensively Delayed ArbitrumDAO Minigrant Winners
Entropy has voted AGAINST and will echo the sentiment of other delegates. While this situation is unfortunate, the payment was denominated in ARB and it would set a bad precedent for the DAO to retroactively cover fluctuations in the price of ARB.
Hackathon Continuation Program
Entropy has voted AGAINST. We would like to emphasize that we are aligned with the overall purpose of the proposed program; continued support for promising builders and hackathon projects is important. Additionally, providing this support via investment instead of grant makes a lot of sense. However, we feel there are some key details missing that make it difficult to gauge whether the terms between the DAO and RnDAO are fair compared to the return for both parties.
It is implied that RnDAO will receive ownership in supported protocols through a SAFE + token warrant, but it is not immediately clear whether or not they will be providing any matching capital for the investment or what the split in equity received between RnDao and Arbitrum DAO will be. In the past, RnDAO’s Co.Lab program was funded through Pluriality Labs with 156k ARB and it appears that RnDAO received 10% equity in each of the 3 projects that joined. This is the model as described by @danielo:
Our concern is not derived from RnDAO’s venture model, but more so with the lack of detail presented in the proposal. When looking at the contributions from both sides, Arbitrum DAO is covering ⅔ of the management cost for running the program and the $124k capital investment. While, the majority of the quoted “matching” of value comes from the $180k of “venture support.” Whether this venture support involves any capital or simply RnDAO valuing its support services is unclear (x hours of support at x rate).
The comments make it clear that the DAO will be receiving equity but the proposal itself lacks required details surrounding what this will look like in practice. Based solely on the proposal’s language without the supporting comments, it appears that Arbitrum DAO is LPing $124k, paying ~$60,000 for the salaries associated with operating the program, and giving one of RnDAO’s portfolio companies a $30,000 grant, but not receiving any upside. Specific details surrounding the split between RnDAO and Arbitrum DAO, both in terms of value provided and equity acquired, should be present before moving forward. In general, the proposal seems to be more of a sentiment check to see if it’s worth RnDAO’s time to continue exploring the idea rather than a fully planned out program.
On a separate note, internally our team has made note that this seems to be a recent trend where proposals are posted to the forum with a majority of details missing (not saying this is fully the case here). We speculate that there may be several factors contributing to this trend, but regardless of the cause, it is something we’d encourage proposal authors to refrain from doing.
Before moving to Tally, our team would like to see the following revisions:
- The expected terms and RnDAO’s involvement for the investments laid out as simply as possible.
- The inclusion of reports to the DAO at the conclusion of each stage so that we can understand the rationale behind the 4 teams selected for Stage 1 and the 2 teams for stage 2.
- A short update on the projects that were invested by RnDAO’s as part of the Co.Lab grant from Plurality Labs. Greater transparency into how these ventures have progressed since the final Co.Lab report in May would be helpful in evaluating the overall value proposition of this proposal.
With the Holiday Break coming up, we would recommend to the RnDAO team that they take the extra time to fully flesh out the details and expectations for this program. This will add ~28 days to when an onchain vote can be executed and funds sent. While we understand that maintaining momentum may feel like the strongest priority, we strongly believe that it is more valuable to take the time to structure this program correctly, especially since there is an investment coming from the DAO.