Build a 100-year Reputation👑: Q4 and the year ahead

Celebrating our Wins

Owls :owl:,

The end of the quarter is an excellent time to take a step back and celebrate our collective achievements. Looking back over the past months, it is incredible how far we have come. Our community has welcomed many new faces, and we continue to grow closer and stronger. Together we accomplished many of our biggest goals! :rocket:

My favorite memories from the past year are conversations with community members as they first started their journey into crypto. I remember these conversations well and feel humbled to watch these same people accomplish extraordinary things at Index Coop. We continue to attract and grow the best talent in the world. Not only do we draw the best talent - but we attract people who are committed to doing things the right way. We all see individuals and communities in crypto that focus on short-term gains over long-term success. That is not what we are about.

We faced many challenges in the past year. There were moments when these challenges seemed to threaten the very future of the Coop. Many of these challenges took a real human toll on the individuals tasked with solving them. If you have been a contributor for any meaningful amount of time, I know there have been times of real exhaustion and frustration. But we triumphed over every challenge by working together and staying close as a community. We have a lot to be proud of!:crown:

Looking forward to Q4 and 2022

As we continue to shape our collective strategy, I would like to share my personal goals and focuses for the next quarter and the following year.

Build a hundred-year reputation

Index Coop is a culture and values-based organization. Something stronger than simple economic value unites us. When I first joined Index Coop, I remember how impressed I was that our community didn’t focus on pumping the $INDEX price. Instead, people focused on growing and building our protocol.

In crypto, everyone thinks in terms of days, weeks, and months. But we are building an organization that will last for years, decades, and hopefully centuries. The only way to create something that will genuinely last and stand the test of time is to build on a solid foundation. While the organization will evolve and the people will change, the foundation remains the same. For Index Coop, that foundation is our shared values - trust, integrity, ownership.

Ethereum Mainnet is the most adversarial and competitive economic environment in human history. We need to be at our absolute best to win in this ecosystem. The only path to true and lasting victory is instilling our culture and values in every aspect of our organization!:muscle:

Design Collaborative Games

Crypto-economic systems are the most sophisticated tools ever invented for human collaboration. These tools allow large groups of people to coordinate and solve complex problems by carefully aligning incentive structures. DeFi and, more broadly, crypto is a race to see who can design the most effective coordination systems.

DeFi projects that fail to solve coordination problems face an existential threat for survival. We are in an arms race to solve coordination problems, and just like any arms race, the price for losing is permanent and final. We have no room for error here.

Think of Index Coop as a multi-player adventure. Our design focus is on creating a game that is fun and rewarding for people to play together. We want to design a game that is simple enough for anyone to play and enjoy, but also complex enough that even the most brilliant person will be continually enthralled, challenged, and forced to grow.

We don’t want to build games that are fun to play alone. And we don’t want to construct finite games with clear winners and losers. We want to develop games that encourage people to play together and to keep playing. We do this by designing games that allow people to work together and collaborate while challenging them to perform at their highest possible level.

Lead by Doing

There is a lot of noise in crypto - we all know that. Sometimes it can feel like a tweet or comment has a more significant impact than months or years of work. That is not reality. Building a system that will last for a hundred years takes hard work. It takes people showing up every day. It takes facing significant challenges and big obstacles. We are not here at Index Coop to only talk about the future or post about how things should be. We are here to build a better future. We do that by showing up every single day, rolling up our sleeves, and doing the hard work.

Our most important improvements come from the process, not the results. We need to eliminate this mentality of constant judgment and striving for recognition based on short-term results. Index Coop is a process-based organization - the results don’t matter if the process is broken. The only way to get consistently great results is by building extraordinary processes.

If you see a process that is broken or not working efficiently, fix it. It doesn’t matter how small or big that process is, and that is the hard work that keeps this DAO moving and thriving. We must not get so caught up in details and complexity that we fail to take action.

Next Steps: Building our foundation

Our organization is big and decentralized and changing quickly. We need to build our long-term goals and strategy. However, we will never be able to make good group decisions if we do not have the right people in place and they do not have long-term security. Part-time processes lead to part-time results. The Coop needs leaders with actual protocol ownership and long-term skin in the game.

We have those leaders in the Coop right now - and if we don’t take immediate steps to retain them for the long-term, they will eventually leave. We have attracted some of the best talent in DeFi - it is time we recognize that talent and start seeing it as an investment in our future. You can’t hire outstanding leadership, and it doesn’t come in a job description. Great leadership emerges organically in times of great stress and growth.

We need to retain our leaders. Losing our most high-impact contributors is an existential threat and represents a collective failure to solve our most urgent incentive alignment and coordination problems.

To solve this problem, I am proposing that we take the following step immediately.

Full-time hiring

Index Coop is a $400 million asset manager. We currently only have four full-time contributors - this number does not reflect the current reality of our protocol. Our primary partners of Set Labs and DeFi Pulse are both hiring people full-time to work on Index Coop- this is good, and we are glad to have these people on the team.

However, our partner organizations should not hire people to work on Index Coop without first ensuring that our day-1 contributors and leaders have meaningful long-term job security and a share of protocol ownership. Ownership needs to align with exposure to risk and the massive amount of work contributed over the past year.

The mentality that we will hire better people through a job search is flawed. We have the people we need right now, and we need to keep them.

What:

Full-time compensation package with the following specifications.

  • $5,000 USDC a month for living expenses
  • $5,000 INDEX a month
  • 20k Index vested over 2-years

This package equals ~2% total protocol ownership for our most impactful early contributors and leaders. Existing FT contributors should also be moved to this package.

Who: The following community members should be offered this package. This list is based on contributor rewards for the last year - Proof of Work 2.0. If anyone was missed - please comment.

  • The individuals on this list have all made significant impacts on our protocol and are all in positions of significant long-term leadership

  • They have all contributed for a significant amount of time(most for longer than six months)

  • Finally, they have all taken a significant risk to join this project, a level of risk that far exceeds even early-stage start-up employees

This process will quickly and efficiently retain our most high-impact and high-leverage contributors. I expect we will follow a similar process in a few months to retain the leaders who have arrived in our community more recently. Alongside this, community members listed should not feel pressured to become full-time if they wish to remain in a part-time role, people have outside commitments and obligations.

@fallow8 - Institutional Business Working Group (founder and co-lead)
@Metfanmike - Institutional Business Working Group (founder and co-lead)
@Matthew_Graham - Treasury Working Group (founder and lead)
@overanalyser - Product Working Group (founder and co-lead)
@Mringz - Business Development Working Group (co-lead)
@MrMadila - Growth and Marketing Working Group (co-lead)
@Pepperoni_Joe - Organization and People Working Group (founder and lead)
@mrvls_brkfst - Language Operations Working Group (founder and lead)
@DevOnDeFi - Design Working Group (founder and lead)
@Lavi - Metagovernance Working Group (lead)

Every person on this list has been a Gold Owl level contributor and working group leader since at least April. Most for much longer than that. Before we design any further incentive systems or protocol ownership, we need to ensure that the contributors who helped found this organization and led Index Coop through the most challenging times are fairly compensated and retained.

When: This is a significant proposal, and I’m sure there will be open questions. However, we need to move fast here and cannot waste time on endless debate. I would like this to be voted on via IIP within a reasonable timeframe - i.e., over the next two to three weeks. I hope groups that are working on similar proposals can offer improvements and insights. We reach the best results by following a process of collaboration and discussion.

Why: Over the past year, I have had many conversations with all the major stakeholders in Index Coop - including Set Labs, DeFi Pulse, 1kx alongside our other investors, and most importantly, our community members. Everyone is aligned on the need to retain core contributors and ensure our core leaders have a meaningful long-term stake in our protocol.

I expect this or similar initiatives to receive support and buy-in from all major stakeholders and our community as a whole. Incentive problems present existential threats to DeFi protocols. We need to take bold and immediate action to solve them - if we don’t, the market will solve them for us, and we will lose.

Thank you for taking the time to read this. I hope this resonated with you. I look forward to building a hundred-year reputation together.

Request for Feedback

What is unclear?

What needs improvement?

Note: I am aware that a number of Owls have been hard at work designing long-term incentive structures for our community and expect they will share their research and proposals soon which will likely go even further to improve and elaborate what is laid out here.

13 Likes

Love the initiative and the sentiment here! And all for all those individuals finding full-time employment at the Coop.

*Note: speaking from my involvement in the Compensation and Token Ownership lane of Index 2.0

However, hundreds of hours of work have been put into Compensation and Token Ownership as a part of Index 2.0. Those proposals will be rolling out to the forums here shortly. Under these models, “full-time” will look different than what has been in the past or what is proposed here. I think it is prudent to let the Index 2.0 initiative go through its process and proposals - the goal there is to lay a foundation for being able to attract and retain FT contributors for multiple years in the future, as well as reward people retroactively.

So, just want to re-iterate, I share all of the same sentiment around retaining core contributors, etc!

15 Likes

That is great news - I’m incredibly proud of the hard work that has gone into Index 2.0. I view that initiative as a true turning point for Index Coop.

I hope the proposals from the Compensation and Token Ownership team are even more comprehensive, generous, and far-reaching than what is laid out above.

The only thing that matters is that we take immediate and aggressive action to fix our incentive structures so that we compete and win.

7 Likes

This seems like a natural progression in maintaining the growth of IC. I look forward to seeing the details of the compensation and token ownership proposal but retaining people who’ve built up IC to what it is today is the right thing to do

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How to enter the club?

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Thanks for the post, energy and for generally trying to drive this forward, @BigSky7.

As discussed by you and a few others above, there’s a pod of people working on something hopefully quite substantially more ambitious - which I think will help drive the changes you’re seeking here and and even larger change across an even more incentivized community. We need to give the core community much more ownerships… more to come soon!

Cc fellow pod members @Hammad1412 @Metfanmike @Pepperoni_Joe @Matthew_Graham @jdcook @iluscavia @bradwmorris @ElliottWatts @gregdocter

10 Likes

Flagging from a previous post, there are many many owls not listed, including those who may belong to organizations with INDEX holdings who helped build the organization.

12 Likes

Not sure where to post this so will leave here as it is about compensation and contributor ownership.
Glad to see this conversation is happening and being given serious thought. I’d like to flag that I believe we may be seriously under estimating the threat of poaching. All the conversations I have had with our industry peers is that it is open season on hiring anyone with any experience of crypto/defi. Not just devs. From community managers to social media experts, from designers to accountants. Defi and tradfi are struggling to retain and fill positions. I know from private conversations many people around IC are already receiving offers and the frequency is rapidly increasing. If poaching turns out to be anything like it was in tradfi it’s not just one or two individuals here and there it was often entire teams. As a DAO with no contractual obligations or notice periods etc we could risk losing swathes of talent overnight.
With that said I believe everyone who contributes here is loyal, believes in IC and sees the bigger picture. But I also believe we should be vigilant of complacency and offer competitive compensation to retain and attract top talent. This is a great start. Thanks to all involved.

14 Likes

Poaching is a real concern, one of the biggest issues in DAOs is the instability of income (alongside other meat space things such as insurance, proof of income documentation, taxes etc).

That said: the true power of DAOs comes from the full roster of contributors not just the core and high contributing periphery (gold owls).

A larger plan that would give some form of stability or at least predictability of income for all types of contributors (copper to full time owls) would be the best way forward.

It appears such a plan is in the works. If true, I am against this IIP, as only offering stability to a few at expense of the full DAO will only exacerbate poaching issues as up and coming talent will be looking for stability possibly elsewhere, and there is no promise for when another omnibus hiring such as this will occur.

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[My perspective below is from the position of a) Index Coop’s interest: first hand experience hiring web2 and web3 talent for previous startups and Index, and b) Personal interest: as a WG lead, my primary income is from Index Coop]

Thanks for bringing this up so passionately. People are our competitive advantage, and we need competitive compensation to retain and attract the best talent :handshake:

Strongly agree- we’re in an insanely competitive market that makes web2 hiring look easy, and it’s unlikely to get less so. Web3 by nature further increases the leverage, and value, of the right people.

Compensation needs to be competitive enough so that the bulk of our team aren’t interested in being poached; they love the people, and are focussed on Index Coop’s mission and upside, rather than being concerned about being undervalued.

I’ve got great confidence in the people and process underway, and I’m optimistic that the outcome will be a compensation structure that address the concerns in this thread.

12 Likes

People have driven The Coop to where it is today (400mil manager in 1 year! ← incredible), and people will drive The Coop to the next level. If those people aren’t here driving The Coop to the next level, then they’ll be enabling another organisation instead, so it is imperative that sufficient compensation and incentives are in place.

The above point is so true & to date $INDEX price has never been a topic of conversation. All attention is focused on real growth & delivery of awesome products. I can’t think of any organisation (traditional or DAO) where this is the case. It is commendable.

The proposed compensation specifications seem very reasonable both for The Coop (given the huge value each individual brings) and for the individual .

I suggest there should be a further BHAG (Big Hairy Audacious Goal) component of the compensation package whereby The Coop sets a goal (for example: Index Coop to have Xbn AUM by date XX/XX/XXXX). And if the target is achieved, a performance incentive is paid. An interesting blog here re. The reasons the most successful organizations use BHAGs → (BHAG — Why The Most Successful Companies Set Ambitious, Long-Term Goals & Why Yours Should Too). I will stress again though - a BHAG should not be a deviation from the proposal, as the existing proposal is both sensible & reasonable. I fully support.

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