Nest DAO Ideas & Issues

[burrrata]

@joeycharlesworth

2 Nest WGs, one for strategy and one to discuss potential deals so that they can run in tandem.

Yeah that makes sense. A lot of NestDAO members have domain expertise, but might not want to dedicate the time to work on the NestDAO meta-model. Would be good to separate out discussions regarding deal flow and discussions regarding fund structure and our role in the ecosystem.

@joeycharlesworth

1. Retrospective

I would like to suggest doing a retrospective, where we go through all of the Nest projects funded to date and do some form of review. What worked well? What didn’t work so well? What could we have done to improve the outcome?

Fuck yeah! Data is power. As is, I think a lack of data in the Aragon ecosystem is one of the biggest contributors to the chaos and confusion. This is not because people are trying to hide anything, but because the space is moving so fast and we’re doing so much that it’s been hard to keep track of everything.

AFAIK, no one is incentivized to keep track of everything, so they don’t. We should figure out more ways to fund roles that invest in the “Aragon commons,” and part of that should be getting data on finances. This would include Aragon’s past investments and their results, Aragon’s current burn rate, and lessons/strategies learned from the experiments that can guide future capital allocation, specifically with the NestDAO program.

All that to say, would be happy to dive into the archives and analyze past projects with you. We could start by surveying Nest project leads, but… unless they have more projects in the pipeline they’re not going to be incentivized to provide detailed or honest feedback. In fact, if they do have deals in the pipeline they’re even more incentivized to provide detailed, but dishonest feedback! lol.

In addition to surveys, let’s create a framework we can use to evaluate past and current investments. This will give us a common set of metrics/questions to compare projects against, and give us a framework to guide decisions moving forward. This could be as vague as determining if the projects are in use and actively contributing to the goals outlined in the manifesto, or it could be as detailed as creating a valuation model for ANT and modeling how each Nest investment adds to the value proposition of ANT as a token and Aragon as a platform.

@joeycharlesworth

I would add an additional one for “reporting requirements”.

That’s a great idea! We should sketch this out. Do you want to start drafting that in the Nest repo? Actually… @LouisGrx Is the Nest repo a good place to start working on initiatives like this, or should we create a “Nest Ideas” repo or something for the NestWG to collaborate on initiatives before submitting a PR to the official repo?

@joeycharlesworth

How much should be invested in Nest vs Flock?

That’s a good question. Once we’ve dug through the archives and assessed how well the Nest program is working and how much value is being added, then we can assess that against the performance of the Flock program and propose some rough guidelines. ATM though, we need more shots on goal. Since Nest ventures are cheap af compared to Flock, I think that the general goal atm should be to increase deal flow.

@joeycharlesworth

It would be nice to see an investment/grant thesis to clearly explain what types of projects Nest is funding and why. Technical projects only? Non-technical projects? What stages are suitable? Solo founders accepted? What will it not provide grants for?

This is important for attracting the right kind of deal flow for Nest DAO (and reducing the amount of wasted time reviewing or replying to projects that don’t fit the grant criteria)

Yes, yes, and yes. I’m shocked this isn’t already a thing. It’s kind of essential. As mentioned in the “Nest archives” comment, would be happy to work with you to draft, share, and refine this into an actionable framework we can use to guide decision making.

@joeycharlesworth

I would like to propose creating a “Request for Projects”, similar to the commonly used “Request for Startups” where we take a proactive approach to deal sourcing rather than merely reactionary.

There’s an Aragon wishlist that @luis put together, but I think we’re due for a new one. My personal opinion is that we should really push for Aragon apps development as every app added to the platform doubles the amount of potential Aragon DAO configurations possible. There’s lots of other things that would be helpful though. We should start a survey or something…

@joeycharlesworth

7. No skin-in the game

This is really a recurring focal point of conflict in the community. Not enough contributors hold ANT. There’s lots of ideas on how we might fix that such as the CRDAO and partially paying out grants in ANT.

@joeycharlesworth

Should Nest DAO members that can afford it invest alongside the Nest DAO? (so they have skin in the game)

ATM NestDAO members simply cannot “invest” along side the NestDAO because it’s not an “investment.” We’re just giving money away lol. That’s why it’s the Nest grants program, not the Nest investment fund. I think an investment fund would be awesome, but that’s not what Nest is today.

@joeycharlesworth

Should Nest DAO members be remunerated for their activities? (if investing in a for-profit project, it would seem logical that they should share in some of the upside). If not, how can we ensure the work that needs to be done relating to Nest DAO actually gets done?

NestDAO is a DAO for Aragon community members to allocate grants to projects that contribute to the strategic objectives of Aragon. Investment thesis TBD. In addition to sourcing deal flow and doing due diligence, we need to provide support infrastructure to help teams build and ship the ideas they pitched us in the first place. This could include requirements for financial transparency, documentation and user guide requirements/templates, and help performing security audits. This is easier said than done.

VC firms like USV have a whole network dedicated to this. They do this because they want to maximize the return on their investments (time, money, impact). Anything they can do to increase the chances of success is a win for all parties involved. If we want to support our investments and ensure that projects get shipped, we need to support the NestDAO team. This could be through salaries, completion bonuses, finders fees, whatever… The point is that if we’re investing hundreds of thousands of dollars to support Aragon projects, it makes sense to also invest in the Aragon team that finds, selects, and supports those projects.

@joeycharlesworth

8. Nest DAO member criteria

The current members of the Nest DAO are comprised mostly of Flock members. Given the AA has limited funds as well as the fact that there is not currently any other major Aragon revenue streams, there is essentially a competition for capital between Flock & Nest teams. As such, it’s not unfeasible that Flock team members will vote against new Nest projects even if they might be good for the Aragon ecosystem as a whole, to increase their share of capital allocation.

How can we avoid this scenario from happening? Should we increase the number of members in the Nest DAO? Should we have strict budget allocation for Flock vs Nest teams?

It was suggested to create a code of conduct / guidelines for Nest DAO members to avoid scenarios where they might behave unethically. Given that “ethical” is often a subjective grey area, this seems to me like a wise suggestion.

This is a huge conflict of interest. Thank you for pointing this out!

If there is a budget then we’re creating a zero-sum game. If there isn’t a budget then things can easily spiral out of control. There’s no easy solution here.

Perhaps a bit of competition would be good though? This might incentivize us to

• create a valuation/success framework/metrics to analyze our investments
• support our investments to ensure that they succeed based on that valuation framework
• maximize resources by promoting synergy in the network (expert network, working groups)

This could help us make better investments and help Nest teams (more) easily ship quality products. This would only work if the NestDAO team is incentivized to do this, which requires a compensation structure as described in, 7. Skin in the game

@joeycharlesworth

9. Grantee Pledge

Not sure about this one. This could easily just be treated like an iTunes ToA. Everyone signs it, but no one reads it. If it’s not a ToA then it becomes kind of cult like. An investment thesis that outlines concrete strategies to execute on the Aragon mainfesto is a much better way to ensure that investments align with our values. Also, IMHO Nest grants are meant to support projects, but there isn’t an expectation that teams contribute to the Aragon community beyond shipping that project.

@joeycharlesworth

10. Function specific DAOs

@joeycharlesworth

resources to be deployed for the benefit of the whole community rather than just a single application or team

Yup! Just going to bump this again and say that it would be an awesome, cheap, and fast way to try stuff out, get feedback, and support the Aragon commons

@joeycharlesworth

11. Expert Network / Nest DAO support

@joeycharlesworth This fits into the larger theme of supporting the Aragon commons and maximize our investments in Aragon projects. Happy to collaborate with you on this if you want help designing or building the actual DAO, but from your proposal it sounds like you’re already building a team (which is great too!). Regardless, we should discuss this at the next NestDAO WG metting.

@joeycharlesworth

12. Success Metrics

For Nest projects that do get funded and that don’t have a profit motive, what does success look like? Shipping to mainnet is obviously a key goal post. But what other metrics might be good to track to better contextualise our decisions? Number of users? Community dot voting? App Ratings? App Reviews? (which don’t exist yet but could)

This is what I was referring to in the first part of this comment with a valuation framework that lets us know how well things are working out. This is essential. In an ideal world we could tie these metrics to the performance/valuation of ANT, but until then we need to create a framework to analyze projects ASAP.

@joeycharlesworth

most accelerators (and VCs) negotiate discounts with popular service providers

This is definitely possible and should be something we optimize for. I’m already in the process of talking to security teams for 1Hive’s Dandelion Orgs, but I’m sure A1 also has a lot of experience and connections that could help get negotiate discounts as well.

One thing that could help immediately is integrated automated security testing frameworks like Trail of Bits CryticCI or Consensys Dilligence MythX. They’re CI, for solidity code. They work great and reduce the amount of time security auditors have to spend on busy work and low hanging fruit. We’re running these at 1Hive, so happy to talk with the NestDAO WG and/or anyone else about adopting them ecosystem wide.

Another thing would be expanding the Bug Bounty Program to cover all the apps that the Aragon community funds and ships.

We should really determine the initial support services we want to provide though. This is going to take time to develop. As such, we should start discussing it ASAP and it needs to be a core part of the next NestDAO WG meeting. Maybe we could create a separate thread to discuss just this (which services to provide and a tentative budget for the next ANV period), and then the community can weigh in?

@joeycharlesworth

14. Aragon App Mining

We’re working on it! @lkngtn you’re leading the charge on this right?

@joeycharlesworth

15. For Profit Grants

This would be amazing after we’ve ironed out an investment thesis, success metrics, support infra, and incentives for NestDAO members. Then we could actually invest in projects, support them to completion, and recycle gains into more grants. If successful, this would allow the Nest grants program to move away from relying on treasury funds to being more like an endowment fund