M&A for Arbitrum DAO

[Bernard]

Hi Feems, thank you for your feedback and contribution in yesterday’s working group call! Always appreciate your view, esp. when thinking through topics that sometimes get overlooked in strategic or financial considerations.

On the outstanding questions, happy to expand on some of the details below and add missing parts to the proposal.

@feems

Establishing a dedicated, seasonal working group (rather than an open Telegram group) could help address this by evaluating if pursuing M&A is the right move at this time. You can add this as a pre-phase within the budget that would then a vote for implementation of Phase 1 can occur. This would also provide an oppertuntiy for meaniful contribution within the DAO or an example of such for those interested.

• Did not feel there was consensus on this on the last call. The M&A working group has now been active for more than 4 weeks with participation of over >20 members and a lot of this alignment has already been achieved. You can find the detailed work outputs and recordings in the working group thread here. Obv. if there is consensus to take further rounds of iteration for tangible gaps, we are happy to do more work on this or consider adding an additional phase to the proposal, but don’t want to get lost in endless working group sessions.

@feems

• Strategic Priorities: We need clarity on our long-term strategic goals.

• Completely agree. We’ve discussed this topic extensively in our last calls as it affects many of the initiatives across the DAO. We collectively landed on that this shouldn’t be a blocker for progress. As mentioned in the proposal, if there is still no clear alignment when it’s time to define strategic target areas, we are happy to gather views from key DAO members to develop an initial view that we can then validate with the broader DAO.

@feems

• Culture: Successful integration post-M&A is not just about strategic and financial alignment but also about aligning cultures.Without a unified culture, how will we integrate new acquisitions?

• Good point - culture considerations are a common topic in M&A transactions. In the end you are always dealing with people and growing inorganically with a big culture mismatch can definitely kill the successful integration of a target. And in our case the DAO’s culture is very multi-faceted by default. This generally is an important part of the due diligence process and discussions with the target.
• On its own, defining Arbitrum DAO’s culture definitely sounds like an interesting subject to look into. I remember you have experience in this area, maybe something to kick off?

@feems

• Financial Health: Is this the right time for M&A? What are the potential impacts on our token price?

• This applies to every major strategic initiative for Arbitrum DAO. Ultimately, all our key initiatives aim to expand the Arbitrum ecosystem and strengthen ties with outstanding projects, builders, and protocols (Grants, Incentive Programs, GCP, etc.). A strong and growing ecosystem might be reflected to some extent in the token price, but I wouldn’t make any claims about a direct impact.

@feems

• Resources: Do we have the necessary human resources?

• We are very confident that the proposed setup meets the needs of this proposal. Please see the more detailed team structures and roles outlined in the proposal. I obv. might be slightly biased here, but I have rarely seen a better skillset/demand fit within the DAO

@feems

• Integration Planning and Risk Management: These are crucial to handle post-M&A integration and potential risks effectively.

• Good point, core part in M&A considerations and part of the M&A units work. Will outline further in the proposal.

@feems

• Governance: How can we ensure decisions aren’t dominated by large token holders or a small group of delegates?

• I feel this is a general governance point and agree new ways that effectively prevent centralization tendencies would be valuable. However, this should not necessarily stop the DAO from making progress or going forward with proposals for the time being.

Thanks again for taking the time digesting and pointing out these clarifying questions - adding some explanatory amendments to the proposal to make it more comprehensive.