Entropy Advisors: Exclusively Working With Arbitrum DAO

Thanks for the detailed comment!

You brought up some comparables. Looking at the MakerDAO GovAlpha core unit, for example, it seems that our salary budget matches quite closely with the facilitator pay matrix provided by them, where a full-time experienced contributor is priced at 189K DAI. This doesn’t seem to include expenses such as benefits, taxes, and other assorted costs, meaning that our salary budget is actually lower than the comparable. The difference in total budget is also mostly driven by the core unit’s smaller size and employment of part-time employees (the proposal mentions a historical 3.75-4.25 FTEs, which would maybe increase with the ~900K budget). Our contingency is exactly in line with the core unit’s. It’s also worth noting that the DAO can decide to distribute no bonus at all at the end of our 1-year term, so this is in no way baked into the expense structure.

The idea behind our budgeting for up to ten employees is to allow us to scale into the DAO’s needs, maintaining the ability to add more capacity where needed. As mentioned in our earlier comment, with three full-time employees and more recently four, we’ve constantly been in a situation where we’re seeing more demand than we currently have the capacity to service. Hiring for the sake of hiring wouldn’t benefit us in any way since if we aren’t producing value relative to our costs, we would either not be able to renew our contract with Arbitrum or our contract would be outright terminated, meaning that we would then have to scale our team down immediately and our reputation would also be damaged.

The size of the budget also derives from the fact that we would be working exclusively with Arbitrum and we need to be able to attract talent. While our growth upside is consequently limited, this puts us in a unique position that not many other service providers want to/can be in, and ensures that our number one priority is always the Arbiturm ecosystem. We do realize that not everyone within the community sees value in having exclusivity. At the end of the day, this is also a subjective question that doesn’t have one correct answer, depending on the extent to which the community prioritizes enhancing efficiency and the commitment they want from service providers. The feedback we’ve gotten from many delegates is that an exclusive structure is preferred, which is why this proposal was created in the first place. We see a ton of value in us already having bootstrapped full-time and Arbitrum-exclusive employees and began facilitating some of the deliverables mentioned in our proposal while lacking conflicts and being able to credibly act in the DAO’s best interest. Despite the high-quality nature of all the companies you listed, our understanding is that none would be willing to accommodate this feature and benefit.

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