Abstract
Proposal 40 outlined a new operating structure for the DAO going beyond the original Core Team, and including new Management Board members. Proposal 40 also established 9 functional SparkTeams to add the capacity and capabilities required to transform the PowerIndex/Agent technology into a leading crypto asset manager, owned and operated by xCVP stakers as a DAO. The Core Team will begin to vest their CVP allocations at the end of this year, but an operating budget needs to be established to compensate new Management Board members, and establish operating budgets for each of the 9 SparkTeams, for which external Team Leaders and as many part-time (DAO) contributors as possible will be sought.
Motivation
Migration to Balancer v2, the launch of xCVP staking and the next version of the website to support xCVP staking/redemption are almost complete. The stage is now set to expand the Power Universe dramatically with many new pools and key partners, to initiate dashboard fundamentals performance tracking of tokens within pools, add insurance options, implement Treasury management and reporting, define yield optimisation/hedging strategies of each new pool and invest in efficient marketing.
Marketing will be a particular challenge for PowerPool and the Power Universe because there are two target macro investor segments with distinct profiles:
- Average investors looking to achieve broad diversification WITH rewards harvesting at minimum gas; and
- Institutions/family offices looking to achieve broad diversification WITH rewards at minimal cost and complexity in client reporting, rewards harvesting and meta-governance management.
Converting an on-chain protocol like PowerIndex/Agent into a leading asset management organisation addressing both the above market segments will require adding a sufficient number of qualified people able to wield real resources from within an approved operating budget. Without an approved operating budget sufficient to address these challenges, PowerPool will soon be overtaken by much larger (in terms of people) and better-funded DAOs, despite having a superior platform and technology. DeFi technology is now proven, and the competition has shifted from which is the best protocol to who has the best organisations. The time to attract and retain the best people is NOW.
SparkTeams are divided by functions because this is best for incubating/launching numerous new products.
Each SparkTeam aligns with at least one Core Team/Management Board Member, who may (initially) play the role of Team Leader.
This new PowerPool governance system gradually shifts daily decision-making powers from the multi-signature wallet down towards SparkTeams, organically-formed specialised DAO contributor teams, team leaders, and specific remits:
- SparkDev (core protocol development, security & audits);
- SparkDesign (online functionality, UI graphic design, and usability);
- SparkFin (DAO Treasury management, NAV/P&L xCVP staker reporting);
- SparkData (dashboards for tracking Power Universe pools & investor reporting);
- SparkPeople (HR & skills, grant/bounty incentivized task recruiting);
- SparkProd (testing/yield-optimising branded âPower Universeâ thematic pools);
- SparkDAO (Wiki, Forum and Governance content & moderation);
- SparkGrow (marketing and partnerships - Power Universe & xCVP);
- SparkLegal (external legal advisor)
Team-based, more modular governance will allow PowerPool to adapt quickly despite its (hopefully) increasing size. Not everyone feels qualified to vote on every type of proposal.
The idea is to push as much decision-making as possible down into the SparkTeams, surfacing technically-sound sub-consensus options on the Forum and tabling formal Proposals to the DAO if required by the rules of the DAO. Every one of our main competitors offering diversified structured investment vehicles is doing similar things.
While most of the decision-making powers previously held by the Multisig will be delegated to SparkTeams, the execution power stays with the Multisig pending future proposals. The Multisig is tasked with executing the decisions issued by SparkTeams within their domains of action and with âVeto Powerâ should they feel a decision needs further review. The multi-signature wallet will still be the entity which executes proposed changes to the protocol and will retain veto power.
Specifications
It is proposed to approve an operating budget. The operating budget is denominated in USD fiat, but disbursed in CVP from the approved operating budget. The operating budget is be composed of various items:
- Monthly stipends for Management Board members outside the Core Team (whose CVP will begin vesting at the end of the year);
- Monthly stipends for the Team Leaders of each of the 8 internal SparkTeams not led by members of the Core Team and/or Management Board;
- Operating budgets for each SparkTeam commensurate with the forecast external staffing/bounty requirements outside the Core Team, and for SparkDev also the operating expenses for the various technology stacks/platforms.
Proposed Operating Budget
Public Team Members (outside of Core Team):
All 4 new Management Board (Public team) members have agreed to monthly stipends of $US 5,000. They will also be granted additional tokens from the original Core Team allocation, which they intend to stake as xCVP.
SparkTeam Operating Budgets:
SparkDev - $US 18,000/month: Led by the CTO and staffed by unsalaried Core Team members; includes routine technology platform costs, external auditing & contingency;
SparkDesign - $US 1,000/month+$US 3,000 annual provision: Led by CTO and staffed partially by unsalaried Core Team members; with provision for retaining external design/development assistance in continuously extending the functionality of the website, and an annual provision for design contest awards for improving the overall design and visual impact of the Power Universe and its tokens.
SparkFin - $US 6,000/month: Led by a highly-qualified external finance appointment TBD, with provision for additional external developers to deliver full suite of DAO Treasury management reporting and NAV tracking;
SparkData - $US 12,000/month+$US 10,000 annual provision: Led by a highly-qualified external analytics appointment TBD, for high-value data feeds acquisition, continuously retaining external dashboard contractors and an annual provision for building the analytics and visualisation platform supporting the ever-expanding number of analytic dashboards tracking all the short-listed tokens in the Power Universe to inform active pool management by the DAO;
SparkPeople - $US 0/month: Led for this year by Gordon Gekko, focused on recruiting and retaining key appointments based on approved SparkTeam budgets and in some cases by encouraging Ecosystem Fund grant applications;
SparkProd - $US 5,000/month+$US 4,000 annual provision: Led by Vasily Sumanov with provisions for an expanded team of developers/analysts to model and optimise Power Universe token pools risk/return performance/yield management based on guidance from the DAO, with an annual provision for rewards to be paid for investment ideas submitted and approved by the DAO for Power Universe-branded products (which we hope is not enough!);
SparkDAO - $US 15,500/month: Led by Dr Gonzo with provisions for existing and new Ambassadors, and external developer(s) to extend the functionality of all the DAO coordination and governance platforms, including contributions to open source governance platforms;
SparkGrow - $US 48,000/month: Led by Sven Moeller & Sergey Medvedevfor content marketing & creation, user education and training, influencer programs and an annual provision for participation in family office-oriented investor conferences.
SparkLegal - $US 15,000 annual allowance: External advisors and other fees related to establishing a Dutch stichting legal entity for the DAO.
Total:
- Spark Teams operation: $105,000 per month and $32,000 annual allowance
- Public team salaries (4 persons): $20,000
Totally $125,500 per month and $32,000 annual allowance
All payments for Spark Teams operations and salaries will be provided in CVP from the multi-sig. Our market-maker Wintermute will provide a service for selling tokens in small batches not affecting the market price.
Revisions to Ecosystem Fund Grants
Previously, the Management Board was authorised to operate to a budget of $US 10,000 monthly/$US 120,000 annually (in CVP), exclusive of any payments to the Management Board, chargeable to the approved Ecosystem Fund. This Fund was intended to pay for externally-staffed tasks related to technical development, marketing, and other community initiatives helpful to expedite PowerPoolâs acceleration in product launches to gain AUM/TVL market share.
The spending authorisation limits based on a Management Board of 7 were as follows:
- One time payments:
Unanimous (7 votes for) â Maximum of $10,000 (CVP)
Majority (5 out of 7 votes) â Maximum of $4,000 (CVP)
- Recurring payments:
Unanimous (7 votes for) â $4,000/month (CVP)
Majority (5 out of 7 votes) â $2,000/month (CVP)
All project funding requests exceeding $10,000 per month were to be approved by the community in Snapshot voting as outlined here:
https://medium.com/powerpool/management-board-announcement-5735afe5b570
This system was actually not much used, and disbursements were made only for translations and creativity contests. This approach to funding operations is not consistent with the now-approved delegated functional SparkTeam approach required to quickly and continuously develop, test, optimise and launch new pools to populate the Power Universe.
As part of moving to this new delegated operational budget with 9 SparkTeams, and a total Executive Group of 8 (Public team +Core Team=8) the following changes to operating the Ecosystem Fund are proposed:
- The existing approved Ecosystem Fund will be continuously maintained at $120,000 (disburseable in CVP), providing a ready reserve accessible to the Executive Group in case of need;
- Proposed projects NOT covered by the above Operating Budget will be funded from the Ecosystem Fund according to the approved spending limits above, adjusted for an 8 person Executive Group.
- As more DAO members join the SparkTeams aligned with their expertise, they will be encouraged to submit proposals for funding projects outside those foreseen in this annual operating budget with grants from the Ecosystem Fund
Conclusion
This âfunctional SparkTeams with delegated operating budgetsâ approach is being taken by practically all comparable DAOs. The organisational and financial management aspects of implementing the New Vision documented in the Wiki now need to be reflected in the annual operating budget. Competing DAOs are attracting far more contributors, and moving much faster, in part because potential part-time contributors feel more comfortable joining small functional teams.
The proposed operating budget for the next 3 months:
- $US 125,500 in expected recurring monthly costs and provisions for $US 32,000 in non-recurring costs. This total budget is âbackstoppedâ by the Ecosystem Fund in anticipation of many additional approved initiatives by members of the DAO. The Executive Group is unanimous in recommending the above proposed operating budget to the members of the DAO.
Some resources to incentivise and reward member contributions are included in this operating budget, and more are being kept in reserve in the Ecosystem Fund. Ongoing incentives for LPs and more rewards programs for xCVP stakers, ranging from voting participation bonuses to extra CVP grants for guaranteeing/underwriting substantial liquidity for new pool launches will be proposed to the DAO in the usual way.