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A Science-Based Approach to Community Building | State of the DAOs
You're reading State of the DAOs, the high-signal low-noise newsletter for understanding DAOs.
gm and welcome to State of the DAOs!
Community health is essential for the success and longevity of a DAO. A healthy community leads to increased engagement, resilience, and adaptability, allowing the DAO to develop and grow towards fulfilling its purpose.
Currently, community leaders don’t have good metrics to assess the health of communities. Low-impact web2 metrics like followers, likes, and retweets are insufficient to gauge member engagement or identify deep insights into the needs of a community.
This week, we take a look at a new community health framework developed by TogetherCrew, a project incubated by RnDAO. Their practical and simple dashboard gives community leaders insight into the functioning of the various human systems within the DAO, allowing them to respond to high-impact data on how the community operates, its communication patterns, member behavior, and sentiment.
Next, we take a look at Meta-Governance, a new service being offered by the BanklessDAO DAOStewards. Meta-governance is governance-as-a-service, offered to other DAOs or web3 communities. Meta-governance is intended to strengthen community governance procedures with services ranging from passive interventions like voting on Snapshot, to active interventions like drafting proposals and engaging in forum discussions.
Finally, we want to highlight the work of our new sponsor Game7 DAO. This week they are launching Summon, their new DAO governance platform at ETHDenver. Summon is designed as a meritocratic governance model that distributes power and governing rights to the most productive members of the community. By tracking, measuring, and rewarding contributions, Summon gamifies the contributor journey to build a healthy community around engagement.
Building a healthy community is a crucial aspect of the success of any organization. From tools and services to incentives, we are here to share various approaches that can be utilized to foster a thriving community, helping to drive the growth and sustainability of a DAO.
🙏Thanks to our Sponsor
Game7 is excited to launch Summon, our novel DAO governance platform at ETHDenver this week.
Summon is a community LiveOps tool that takes governance to the next level by making it easy for DAOs to measure the contributions of their members, and reward them in ways that go beyond money.
How it works: Each community member mints a Soulbound NFT that evolves as the member contributes to the community, making the NFT upgradeable and unique. As each contributor completes quests and tasks, they earn experience points (XP), which help them move up in rank and unlock features and rewards in real time.
By tracking, measuring, and rewarding contributions, Summon provides decision-making capabilities to those who invest time and effort into the community, as opposed to only those who contribute capital.
The result is a meritocratic governance model that distributes power and governing rights to the most productive members of the community.
If you’ll be at ETHDenver, come to the Game7 booth (#670) and chat with the Summon team.
👉 Sign up to the Game7 waitlist to experience Summon
👉 Follow Summon on Twitter
A Science-Based Approach to Community Building
By Ashish G
How a team of data scientists, DAO governance experts, and DAO enthusiasts are developing an innovative framework and community building tool to diagnose the health of DAOs
In the middle of 2022, a team of DAO enthusiasts came together with a shared hypothesis that DAOs are essentially flying blind when it comes to building real communities. The team believed that the existing DAO tools were only offering basic audience-related metrics that were developed for web2 projects and that the existing community tools did not provide the insights required to develop effective communities to underpin DAO-led projects.
As a start, the team decided to understand potential users perspectives and undertook market research with web3 community leaders. The findings of the research reiterated the team's hypothesis. It showed that community leaders worry about a range of issues related to their communities, such as the health of their community, member engagement, and how members identify with the community, and they wanted to get more detailed insights into member activity. The team also studied the existing DAO tools and confirmed that there is a gap between the needs of community leaders and the tools available. While community leaders want deep insights, the existing DAO tools mostly tracked low-impact metrics, such as retweets and number of community members.
This insight led to the formation of TogetherCrew. The project is being incubated at RnDAO, an entity with the mission to empower humane collaboration through the dual approach of research on DAOs and venture building for new DAO tools.
A Better Way to View DAOs
To develop a web3-native tool, the TogetherCrew team decided that it needed to start from the fundamental question of how we should view a DAO community. In September 2022, the team released a whitepaper that proposed community should be viewed as nested systems that interact and depend on each other:
Relationships among members
The whitepaper further proposed that a DAO's health is the aggregation of the health of these nested systems, just as a person's health is an aggregation of the health of many organs, which themselves are aggregations of the health of cells. Therefore, to measure a DAO's health, one needs to measure the health of these individual systems and then intelligently aggregate the insights. The framework has resonated with the web3 ecosystem and the project has received support from marquee projects such as Aragon, Aave, Polygon, MetaCartel, Near, and Celo.
What Is a Healthy DAO Community?
The TogetherCrew team proposed that for a community to be healthy, each of the subsystems needs to be healthy. And collectively, the DAO should advance its goals in the short term, while building resilience and adaptability for the longer term. Therefore, a healthy DAO:
Satisfies the needs and aspirations of its members.
Promotes healthy relationships and functioning subgroups.
Advances its goals.
Shows the capacity to be resilient and adaptable to shocks.
Our tool measures parameters of the individual systems to evaluate their health. And an aggregation and analysis dashboard provides a view of the overall health of the community.
From Data-Rich to Insight-Rich
DAOs live online and have a large data footprint, but this data has not been effectively harnessed yet. To add to the challenge, the current analytics techniques were developed for social networks or traditional organizations.
TogetherCrew is developing an analytics tool that ingests existing data from a DAO’s digital properties and requires minimal effort by the DAO community team to implement.
The team’s 'magic sauce' is implementing and interpreting network science measures in the context of the digital platforms that DAOs use.
With this approach, the TogetherCrew team can convert the firehose of DAO data to a dashboard that provides practical insights into the different aspects of a community's health. The dashboard provides measures on how a community operates, its structure, its communication patterns, member behavior, and sentiment. It provides community leaders with lead measures and layered insights into their operations.
The TogetherCrew team has done a range of DAO evaluations. This includes a contributor community of around 100 members, to a product community with nearly 50K members. To illustrate how DAO leaders can derive a wide range of insights and recommendations through deeper analytics, a few examples are shared below:
A DAO wanting to understand the impact of governance on its community - The TogetherCrew team studied the aftermath of a protracted discussion around a contentious vote, across a range of measures. At an aggregate level, the Project was operating well, but members reported feeling burnt out. In terms of sentiment, while the members still believed in the project, they were feeling less connected to other members of the community. There was also an increase in the number of disengaged members. This analysis by TogetherCrew provided some targeted action points for the DAO leadership team.
A DAO wanting to be more resilient - The TogetherTeam undertook a sensitivity analysis that simulated the impact of some active members dropping out from the DAO. The simulation showed that the communication structure could potentially break down if these members were missing. While the DAO was currently healthy, it needed to build a wider base of core community members to ensure its resilience.
A contributor DAO facing scaling challenges - An analysis by TogetherCrew showed how the DAO was missing out on development of domain leaders and project-focused subgroups
Science-Based Community Building
While it is still in its early days, these implementations have reaffirmed the benefits of a science-based and web3-native community building tool. The TogetherCrew team believes that its tool will play a pivotal role in the future of community building. The tool will endow community leaders with new superpowers to help them understand the root causes impacting community performance, track KPIs, optimize member onboarding and activity funnels, strengthen member engagement, support vital members, and automate tasks.
When it comes to organizing web3 communities, governance is critical. The fundamental ethos of decentralization drives the idea that governance of web3 communities should be owned, managed, and conducted by the community members themselves — and no one else. Giving away this important responsibility to an outsider, or a group of outsiders, is not a welcome move, and some believe it signifies a governance failure on the part of the community in question. Dire predictions of “outsiders being mercenaries” who will destroy the community frequently crop up. This thinking goes even deeper, wherein any form of compensated governance is considered a taboo.
Amidst the widespread prevalence of this thinking, we are starting to see changes in the way DAOs are governing themselves. In BanklessDAO, we have started to provide governance-as-a-service, or “meta-governance,” to partner communities.
Meta-governance can be simply defined as governance services offered to a DAO or non-DAO web3 community by a group of governance experts. These services exist on a spectrum and can range from something as comprehensive as running the whole governance function of a DAO to something more light touch, which can involve helping to draft and finalize governance proposals for community members to provide feedback and vote on. This spectrum of services can be defined as an “active governance to passive governance” spectrum, where “active” means more in-depth involvement, and “passive” tending towards more light-touch involvement.
Here is an example of the kind of active and passive meta-governance activities that outside governance experts can conduct. This is by no means exhaustive because the nature of governance itself in web3 is a highly dynamic field.
External parties who can participate in the governance activities of a web3 community can come in different forms, with some being more common than others. These include:
DAOs participating in the governance of other DAOs (common)
A group of governance experts working as an entity participating in the governance of a DAO or web3 community (quite a few instances)
An individual participating in the governance of a DAO or web3 community (rare)
After understanding who can participate and in what capacity, we need to understand how they participate. The most common method of governance participation in a DAO or a web3 community is voting via the DAO’s or community’s token. If the DAO or community does not have a token, then the polling is simply a tally of votes (for, against, abstain). Meta-governance is more concentrated towards governance using governance tokens (the ones that the community uses to vote with) and less so when the polling is done simply by counting votes. This is driven by the fact that external governance expertise is needed when a web3 community is large and complex, and not so when it is small and can be easily managed by the community itself.
Meta-governance has been defined in a single sentence -
“The act of one DAO participating in the governance process of another through the use of a token.”
The above definition holds true, but will continue to evolve over the next few years as DAOs start inviting non-DAO entities to participate and vote in their governance processes. Imagine the complexity and dynamism when entities like web3 VCs, angels, and web2 institutions start participating in governance. Some of this is already happening, which includes a16z’s controversial vote on a key Uniswap governance proposal.
As active and passive meta-governance gains adoption, we will see the emergence of delegates or external parties that represent groups of people. A “delegate” can be a DAO, an individual, or a group of governance experts. Each delegate is given a share of governance tokens for voting on governance proposals. There are both simple and complicated ways of allocating these tokens to delegates. When a delegate is voting on a DAO governance proposal, it means an external party has been granted voting rights.
Since 2022, there have been some meta-governance moves in web3.
The momentum behind meta-governance is now strong. DAOs and other web3 communities have dropped their egos and have started to realize the value of involving external governance experts in shaping and strengthening their governance framework and processes. As external parties start to bring more value to governance, the perception that they are “mercenaries” will gradually disappear.
🔥 and 🧊 insights from across the DAO ecosystem
🔑 Insights: The topic of governance dominates discussions on DAOs, but the effectiveness of DAOs is dependent on the strength of coordination. If DAOs are appropriately structured as decentralized game engines they can bring the chaos of governance and the coordination dilemma into order. This can be achieved by building with coordination at the center and only adding governance as needed. With this in place, other steps can be taken which includes:
DAOs should reward outcomes, not activity. These rewards can act as incentives even as web3 is patterned towards partnership. This pattern should not be neglected since it is a fundamental basis of DAOs.
DAO coordination games should incentivize continued playing and not require any player's perpetual involvement by being self-sustaining and encourage beneficial replication. This can be done by creating graduated contribution rewards and encouraging on-protocol game replication.
Governance cannot be eliminated, but a balance that harnesses the advantages of automation and programmability must be pursued. Using the multiplayer game structure to attain coordination, the games could take any form, and there doesn't need to be one single game of the DAO.
🔑 Insights: The concept of DAOs as the future of business and work has been undoubtedly brought into question during the bear market. Basic DAO accounting has shown DAOs to be highly inefficient when it comes to revenue generation and managing costs. Nevertheless, the concept of “DAO” stays alive and is more vibrant as builders and tech enthusiasts continued to work on innovative tooling, treasury management systems, and new ways of coordinating efforts. For DAOs to continue to thrive, they need to focus on:
Developing reliable governance models that newcomers can adopt is essential to the future success of DAOs.
Decentralization is key in fostering a credible narrative for the future.
Framing a viable and efficient connection between the legal entity and the governance expressed on-chain is a legal challenge in DAOs.
Adopting a bottom-up approach is a possible solution to help developers and communities in DAOs.
🔑 Insights: Impact DAOs are decentralized autonomous organizations whose core purpose is to do good for the people and the planet. They occur in five major categories:
Enabler: These DAOs enable impact through training, funding, and other infrastructure support.
Climate: These are DAOs engaged in climate change mitigation. They focus on agriculture, carbon credits, land regeneration, and tokenization of natural assets.
Social Impact: If a DAO’s mission is to improve the lives of people, then they fall under this category. Their operations vary from social and financial inclusion, hyper-local mutual aid to humanitarian aid.
DeSci: DAOs involved in scientific research, funding, and innovation own this category. DeSci DAOs can be further categorized into research publishing, funding, or scientific innovation incubators based on the nature of their core activities.
Network State DAOs: These are the newly emerging category of Impact DAOs formed around network states which are highly aligned online communities with a capacity for collective action.
Author: Rowan Yeoman
🔑 Insights: DAOs have been quick to experiment with was to restructure in order to preserve their potential and to reduce complexity, but the self-governing property of DAOs has been difficult to scale.
SuperBenefit is a body of explorers who have been working on redesigning DAO governance both on the small innovation scale and also on the larger network scale. Their goal is to construct DAOs as analytic units that consists of similar networked nodes, which can develop into scalable complex systems.
The core design is structured around a two-house governance system which divides into three arms of governance: governance at the community scale, governance at the operational scale, and governance at the team scale.
The model is designed around the observation that people come together around an inspired idea and build on it in the early catalyst stage by sharing governance tools and proposals. As the project develops it slowly evolves to a scalable governance structure. This model of governance will eventually leverage the effective means of carrying out governance across a network.