We will be full-time Arbitrum DAO and our work may be dynamic based on the DAO’s changing goals. That said, we appreciate this call out, and think it is important to paint a picture of what Entropy’s success will look like:
- Save the DAO at least $3m through proposal iterations, clawbacks no one is currently analyzing, and initiatives like the MSS that reduce operation expenditure.
- Earn the DAO at least $3m of additional revenue through proposals like raising sequencer fees, onboarding partners that will increase activity on arbitrum and subsequent revenue, assisting treasury managers to get their proposals to a place they feel comfortable posting them to begin earning yield on the treasury asap, and other means. We expect this number to far exceed $3m.
- Steward a minimum of 10 DAO programs free of ad hoc charges. Examples include the MSS, a stylus sprint proposal we are working on that requires active reviewers, etc. This is in contrast to current programs that have to include charges for conducting preliminary research, retroactive reporting, and proposal authoring in order to properly reward contributions. As an arbitrum exclusive entity, we will do this type of work without charging the DAO (/ grants programs) beyond the proposed amount here.
- Continue our outreach work to onboard 3rd parties by bringing at least 3 significant partners into the ecosystem who otherwise would not have deployed within Arbitrum.
- We will strive for at least 6 parties to attribute their proposals’ success to Entropy by the time our first-year engagement ends. This was accomplished already once with @kluas and Hack Humanity’s GovHack EthCC proposal, but we continue to provide ongoing support to proposal authors that will surface over the coming weeks/months.
- Author at least 2 research reports similar to the fee mechanism that helps provide the DAO insight into problems we identify. This will be done on a case-by-case basis and as needed, but will not be forced just to reach the KPI.
- Onboard 8-10 excellent top minds in crypto who channel their brain power full-time to Arbitrum DAO.
We will remain flexible in where our work is directed to ensure that it is going toward the most value-added initiatives aligned with Arbitrum DAO’s goals, regardless of what those might be over the next year.
Thank you for your thoughtful and balanced response. We acknowledge that some aspects of the proposal require taking a bet on us being successful as executors, and we know we will exceed your expectations. We are beyond appreciative of your willingness to take the time to fully understand the whole proposal and support it.
- Although we were bootstrapped with a grant from the foundation, we did not have the ability to hire beyond 3 employees to maintain runway given the size of the grant. Notably, we likely have another employee starting soon. We believe that we would have been able to linearly scale our initiatives and success with more talent on our team. Arbitrum DAO is exploring 10s of verticals and has already spent ~435M ARB. That is all to say there is an extremely large surface area of initiatives to cover and areas to explore that drive value to the DAO and protocol. In the initial grant proposal for the foundation, we outlined our plan to use the first few months to operate with a bare minimum team, nail down our place within the ecosystem, prove ourselves, and then go to the DAO for further funding and expansion.
- We will need to offer top talent competitive salaries that enable them to choose full-time Arbitrum DAO work through Entropy in place of offers from places like VCs, protocols, research firms, and other governance firms. The Delphi report was presented simply as a comparison and is also supported by other compensation surveys. For example, Pantera’s 2023 compensation report found the following median salaries for mid-career hires: marketing (120k), finance & accounting (142k), BD (149k), and operations (101k).
- We can’t define the role : salary exactly given the negotiation power we’d then lose. For example, if we define marketing: $150k, but are able to acquire an exceptional individual for $75K, now we can hire an additional employee. Defining it here makes us beholden to it as potential employees could use that in negotiations. Additionally, salaries for the same role can vary greatly depending on the quality of the candidate.
- When scaling a company, it is impossible to fully predict every expense. While it may seem large, this is a margin that allows our team to remain flexible and appropriately respond to not only unforeseen expenditures but also any potential changes to the DAO’s priorities.
- While we await Chaos Lab’s research on our proposed minimum fee increase, we are confident that if passed this proposal alone would bring the DAO an additional $5-15m per year. This is in addition to other efforts that drive value to Arbitrum such as onboarding partners, assisting treasury managers to get their proposals to a place they feel comfortable posting them to begin earning yield on the treasury ASAP, and research reports that help provide the DAO insight into problems. It is worth noting we have only been operating for ~3 months, and for the majority of that time only having 2 employees. Without extrapolating, we are confident that the total value driven to the DAO will far exceed $3m with a larger team and 12 months.
- Please see our response to @englandzz above for detailed KPIs.
- Part of our agreement with the Foundation was a stipulation to come to the DAO by the 3-month mark to request additional funding in return for the services outlined in the proposal and continued exclusivity to Arbitrum.
- As mentioned, our primary goal is to help Arbitrum DAO continue its path toward efficient and effective operations. Given the number of current initiatives and the several others in the pipeline, a well rounded team is necessary to properly execute the goals of the DAO. This will include analysts to craft more proposals, individuals with strong networks that can bring in valuable partnerships, data analysts to assist in creating detailed reports and analysis, etc.
- While there is minimal overlap, Entropy’s ability to serve Arbitrum DAO in a full time capacity will be a complement to both of these programs and can assist them with their current efforts. We already have recurring calls and open lines of communication with several members of the ARDC and APDC that will help ensure that inefficiencies are prevented. The ARDC is primarily tasked with analyzing proposals rather than driving them. The APDC, thus far, has been focused on legal frameworks. We don’t expect our scope primarily focused on catalyzing change and aligning stakeholders to overlap greatly. Our goal is to focus on areas where we can add the most value through our unique skillset. Sometimes the type of work might overlap in skills with, e.g., the ARDC, etc., but only if there are capacity constraints on their side or need to move extremely quickly.
Thank you so much for the extremely thoughtful comment @Pepperoni_Jo3. Thanks for the thoughts as well @DisruptionJoe. We really appreciate the overall support and are happy to iterate this proposal to make it stronger. We will adjust and respond accordingly over the next 24 hours.