This essay is an unfinished work-in-progress and started out as a way for me to grapple with how to vote going forward. Rather than not sharing it at all, I decided to post it in its current state, with the hope that it might inspire further discussion on the topic.
TLDR
- We should be pickier with the on-chain proposals we fund, especially in creative fields
- We should leverage Prop House mandates to incentivize and fund dozens of smaller initiatives in specific creative fields
- We should maintain a high-risk appetite that favors experimentation, and make sure we remain open to serendipitous, ‘outsized-ROI’ events
- We should be net accumulators of ETH
The core arguments in this essay build upon the observation that good proposals are a significantly scarcer resource than ETH. If we accept that as true, it follows that we must spend ETH to increase the quality of props. But how, and how much?
I previously reasoned that almost any proposal would engage builders and the community enough to result in a net-positive EV; the meme would sufficiently proliferate and activate other proposals. However, after following Nouns governance closely for the past months, I now argue that we (read: I) should recalibrate and drastically raise the bar for what we consider “good enough” to warrant deployment of capital. [1]
As an alternative to liberally passing almost any proposal, I suggest we deploy that capital via coordinated Prop House mandates. While the permissionless nature of Nouns is absolutely key to its past and future success, it does not mean we have to surrender all control. Using mandates, we have the ability to direct the firehose towards specific avenues of proliferation rather than the scattershot approach of funding whatever ends up at our doorstep. [2]
The shotgun approach does, however, have inherent value as an enabler of serendipity. This is the primary reason I previously opted to pass most adequate proposals. I believe Nouns benefit from throwing a wide net and that, similar to the VC/startup dynamic, some proposals will have an outsized impact on the dao in the range of 100-1000x multipliers. I argue that we would be foolish to think we can predict what those extreme-upside proposals are, and we simply need to take many shots to stumble upon the winners.
We don’t quite know what works until we see it, and to that effect, I believe Nouns need to maintain a high-risk appetite that favors experimentation. But, instead of experimenting with pretty much everything beneath the sun, I now believe we should narrow down our search space to a number of categories and, with the help of prop house mandates, make hundreds of smaller, more focused bets within those areas of exploration. [3]
As for how much capital we should deploy, I maintain that Nouns as a project run a greater risk of stalling out due to a lack of momentum than from overspending. To me, the ultimate outcome of Nouns seems binary; years from now, Nouns will either be a massive force-for-good, or a long-forgotten curiosity. There is little room in-between, and the onus is on us to ensure that we steer toward a future where Nouns become a household name. [4]
Overall, I argue that we should aim for a net accumulation of ETH, but as long as props are excellent (and the experiment with mandates proves fruitful), we should not be afraid to reinvest roughly on par with what we generate via auction proceeds. We are still pushing a metaphorical boulder uphill, and while I think it’s unwise to let off the gas, we can be more intentional with how we deploy capital.
My hope is that this essay can help ignite deeper conversations and transparent steering of Nouns governance by minds smarter and more knowledgable than my own. What I’ve outlined here are strong opinions loosely held, and I welcome any data or reasoning that would prove me wrong.
Overview of how I personally aim to steer going forward
Creative
Somewhat excited to fund
- → Advocate for running PH mandates in creative subdomains
- Ex: explainer videos, animated series, virality content, etc
- Willing to pass on-chain props from recognized masters of their craft
Consumer products/apps, etc
Mostly unwilling to fund
- Willing to pass on-chain props by recognized top-tier teams
IRL activations
Mostly unwilling to fund unless there is a product tied to the activation
- → Advocate for running PH mandates in specific locations
- Ex: Run continuous activations in Williamsburg, NY until everyone there knows about Nouns, instead of scattershot activations all over the globe
- Willing to pass excellent on-chain props with a high degree of creativity
Online activations
Somewhat excited to fund
- → Advocate for running PH mandates
Technical infrastructure
Excited to fund
Compensate talent
Excited to fund
- Curious to explore ways we can introduce competition and elect retainers/residents more transparently to avoid nepotism and stagnation
Charity
Mostly unwilling to fund unless there is a creative or meaningful edge that ties directly into Nouns
Moonshots and experiments
Mostly excited to fund (note: this section needs clarification)
- Willing to sponsor and fund any proposal that seems to have a ‘larger-than-most’ probability of bringing outsized value to the dao
Notes
[1] Many nouners have argued this for some time already — thank you for being patient with me as I came to these realizations myself.
[2] The Nouns Clients/Governance prop house rounds, and to some extent, the NOC Twitter activities, underline why mandates work to attract high-quality proposals and builders.
[3] I’m not sure exactly what areas of exploration we should focus on, but instinctively, I think a good starting point would be areas that feel inherently nounish, embrace technologists, artists/ designers, and somewhat logically fit in with the current “phase of proliferation”, if we were to plot possible proposals on a timeline (ie, is it better to do an explainer video today or in 2 years? is it better to do IRL activations in Shanghai today or in 2 years?)
[4] Speaking of risks, I believe governmental risks are a far greater concern to nounsdao than economic risks. One example is groupthink; market research and consensus committees sanding down unique edges, but that is a topic for another day.