IIP-128 - Priority Hiring Round #1

Status: Proposed
Author: @Matthew_Graham, @Pepperoni_Joe, @ElliottWatts
Reviewers: Index Council, @prairiefi


Index Coop currently has five full-time contributors, with no new hires since July 2021. To ensure the long term success of our organization there is a need to offer compensation packages to secure talent and provide a foundation for future success.


In this proposal, we present the initial step towards securing a core team. We will be upgrading our compensation framework and offering 28 contributors priority hire packages. The package consists of fixed compensation, equity and the ability to participate in the Dynamic Staking Model (DSM).

We have listened to the community, discussed it greatly and collectively decided to act with the goal of retaining a core team of highly skilled contributors critical to the long term success of Index Coop. There are more proposals to follow as we continue to migrate towards a newly refined compensation structure across the Coop.


In this section, the core pillars of the proposals will be touched upon. A contributor’s Impact Level underpins the fixed compensation and equity, meanwhile, the DSM component distributes equity incentivising INDEX ownership.

Impact Levels

In an attempt to onboard at scale, the following structure around base fixed compensation and equity led to the development of nine Impact Levels. Each Impact Level’s compensation is based on competitive market rates. The inclusion of Impact Levels enables onboarding a core team to support the DAO and its operations without the time-consuming nature of individual negotiations.

In a departure from prior full time hiring practices, the refreshed process communicates offers privately thereby protecting the privacy and security of contributors. Following in the footsteps of Yearn, Index Coop will not be sharing the Impact Level of each contributor on a public internet forum. The Impact Level as a corresponding remuneration package is shown below.

Owl Level Impact level Fixed Compensation Equity* Number of Hires
Neon level 9 $350,000 5,100 1
Gold+ level 8 $205,000 4,500 2
Gold+ level 7 $185,000 4,500 3
Gold+ level 6** $170,000 4,500 7
Gold+ level 5 $140,000 4,500 5
Gold level 4 $115,000 3,000 10

*Equity is distributed once each month and has a 6-month lock on each entitlement.
**Level 6 is the Index Council

The contributor has the choice to receive the fixed compensation in one of three ways:

  • 100% USD Stable Coin
  • 100% INDEX
  • 50% USD Stable Coin and 50% INDEX

The INDEX to USD conversion rate will be the same as the contributor reward process of the time (currently a 5-day moving average to the date of payment). People will only have the option to consider swapping between one of the three options above on a quarterly basis.

In addition to the rewards listed above, contributors are eligible to receive further ownership to be delivered through the DSM allocation mentioned below.

It is worth highlighting that not all contributors have received “Full Time” packages, and some of the Core Team packages offered are scaled down (linear) to reflect the reduction based on the time commitment. Ie: 50% committed, receive 50% of Fixed Compensation, Equity and DSM.

The specified compensation at each level may be subject to change - and individually may move between impact levels in future. This decision will be made by the Index Council and communicated alongside the broader periodic model review.

Dynamic Staking Model

The DSM component is directly linked to how many INDEX tokens a wallet holds and Owl Level and is complementary to the “Fixed Compensation” and “Equity” remuneration package. For further information on the DSM, please refer to Community Ownership & Compensation | V2 Proposal.

The flexible aspect of the DSM is intended to provide holders with an APR based upon their token holding at the end of each month. The below charts provide details of token payouts on a monthly basis. The monthly community allocation chart shows how INDEX holding influences monthly token distribution. The x-axis represents token holdings and the y-axis APY and Monthly Token Payout respectively.

The DSM component could represent a significant proportion of a contributors remuneration package relative to the Equity component.

To ensure the model is working as intended the input parameters and performance of the model will be reviewed over a 4-week period leading up to each 6-month interval. The first review cycle will conclude on 31st July 2022.

Outside of these periodic review cycles, Finance Nest will monitor the distribution of INDEX alongside the Retention Rate OKR and present any findings to the Index Council.

The Index Council has the ability to propose parameters changes to the DSM which will alter INDEX distribution. If the Index Council wish to alter the parameters of the DSM, discussion on this will take place publicly for at least 5 days. During this time any individual has the right to “challenge” the proposed changes. In circumstances where there is a challenge, the final decision will be confirmed through IIP - with token holders voting to “approve DSM parameter changes”, OR “do not approve DSM parameter changes”.

Owl Level Impact level INDEX Holding DSM* Number of Hires
Neon level 9 4,500 4,060 1
Gold+ level 8 3,600 3,430 2
Gold+ level 7 2,880 2,926 3
Gold+ level 6 2,304 2,523 7
Gold+ level 5 1,843 2,145 5
Gold level 4 1,475 1,507 10

Note: *DSM is distributed once each month and has a 6-month lock on each entitlement. This yearly DSM amount earned stated above is based upon an estimate of INDEX holding at each level.

Similar to prior Full Time hires, Finance Nest will continue to have the right of first refusal to buy back INDEX from any contributor on a Priority Hire package.

This calculator also allows you to work out what your expected Index Reward will be via the DSM.

This proposal only funds the DSM for the core team. However, we will continue to work to explore options to expand the access to the DSM to a wider spread of contributors once a final eligibility framework (Owl Levels) has been approved.

Priority Hiring selection process

Given the sensitive nature of remuneration, the Index Council has acted to balance empathy, transparency and has also put the long term success of the DAO front of mind.

The selection process for the core team of hiring has been an incredibly difficult and challenging task - there is simply so much great talent across the DAO. Given the nature of the task at hand the Index Council, after much deliberation, determined the best course of action was to hire in the first round, Level 4 and above - with Level 3, 2 and 1 potentially forming part of future hiring rounds. Below is a summary of the process

Offer Acceptance & Renegotiation Process

For candidates who receive an offer, the following can be expected:

  • All offer letters will be sent out prior to 19th January 2022
  • The offer will be valid until 31st January 2022 and the candidate has the following options:
    1. Accept

      i. Transition to the new remuneration package commencing 1st February 2022
      ii. For existing full-time hires who have not yet hit their cliff, acceptance will mean a one-off transaction will be executed which will transfer the vested INDEX accrued to date to the individual. They will then transition onto the new compensation framework in exactly the same manner as individuals who are not currently on FT contracts.

    2. Decline

      i. Continue via current contributor reward construct
      ii. In this instance, there may be follow up attempts to identify an alternative candidate to fill the Priority Hire position.

    3. Request readjustment

      i. An interview will be set up with some Index Council members to discuss further
      ii. Potentially, a revised offer will be presented
      iii. The candidate has the option to accept or decline the offer
      iv. This is to all occur before 1st February 2022

Resignation and Termination

In instances where an individual resigns from their position, the expectation is that the contributor would provide a 1 month notice period.

Forced termination is a challenging topic to navigate. When necessary, the proposes will work as follows:

  • Clear expectations: The Index Coop aims to be transparent in our expectations and measurement of performance.

  • Attempt to resolve: Any failure to meet these measures will first be discussed by the Index Council and other relevant parties

  • Decision: The decision to terminate will be discussed by the Index Council and put into effect by the Finance Nest in the event that performance expectations cannot be met.

Timeline & Next Steps

The above concludes the initial offers for the core team hires with the details relating to the Fixed Compensation, Equity and DSM allocation detailed above.

Funding Approval

To support the core team hiring the following budgetary spend is being requested for the period 1st February 2022 to 31st January 2023.

  • Fixed Compensation - $3,837,500 in either USDC or combination of INDEX & USDC
  • Equity & DSM - 179,017 INDEX

This equates to a grand total at the current market rate of $12.56 per INDEX is $6,085,953. This equates to ~4.84% of the total INDEX supply or 9.22% of the total allocated community treasury which at genesis was 5,250,000 INDEX. At the time of writing, the combined Treasury and Operations Account holds $28M of INDEX (this does not take into account the balances yet to vest into the Treasury). This proposal looks to ring fence 21.7% of this to pay the priority hires outlined in this post.

If all core team contributors took their fixed compensation USDC, this would leave ~5.5 million USDC in the Treasury after year one. This leaves Index Coop with around a ~2-year runway on stablecoin holdings.

The core team will be funded via the Operations Wallet, with periodic requests to fund the Operations Wallet being from Index Coop Treasury by Finance.


The single most valuable asset to an organization is its people. To retain our people we need to offer a compelling compensation and ownership package to keep the best at Index Coop in a white-hot web3 labour market.

The proposal presented here represents the culmination of months of work and is something we truly believe will sustainably set Index Coop up for success in the years to come.

Funding Approval

It is worth noting that per IIP-118 decision making power for Priority Hiring was passed to the Index Council, without the need for individual hiring IIPs. However, given the extent of the hiring proposed here, the Index Council feels it is right to approve this proposal and associated spend via IIP.



DO approve budgetary spend as detailed above.


DO NOT approve budgetary spend as detailed above.


Copyright and related rights waived via CC0.


It looks nice. However, so far I missed advancing from Bronze. I cannot find any information on how to advance. So, your proposals target ONLY Gold, Gold+ and Neon owls. Any advice?

I volunteer as tribute

I greatly appreciate the time and effort put into Index 2.0 by @Pepperoni_Joe , @Matthew_Graham, @ElliottWatts, @prairiefi, Index Council, and others to create a more sustainable, long-term organization. Overall, I am excited by the direction things are heading.

Owl Levels

I’m a little puzzled as to why a proposal for Priority Hires is leapfrogging the discussion and definition of Owl Levels. We had a workshop to discuss our thoughts on Owl Levels and their distribution, but I’ve seen no further information shared on this topic.

The areas of uncertainty that I believe exists with Owl Levels include:

  • Have specific criteria been determined for Gold-Silver-Bronze-Copper levels?
  • Will current Gold Owls stay Gold?
  • What’s the difference between a high-impact leader Silvers and a solid, long-time contributor Golds but no leadership/project ownership?
  • How can we ensure high-value, cross-functional contributors don’t get overlooked?

Dynamic Staking Model (DSM)

I also believe the current state and details of the Dynamic Staking Model (DSM) need more clarity. The specifics in this proposal summarize DSM for Priority Hires, but few updates have been shared about how the DSM has evolved for the contributor community. “Owl Level Factor” has varied quite a bit to where it appears to sit now:

Bronze 1x - Silver 2.5x - Gold 6x - Gold+ 7x - Neon 7x

Without a clear understanding of Owl Levels, it’s difficult to determine if the gap between levels (for example, Silver and Gold) are too large, too small, or just right. Once vesting of the DSM hits six months in the future, there will be a compounding impact on community ownership. Not saying that it’s a bad thing, but the initial Owl Level Factor will determine how “golden” our community ownership becomes.

Previously, it appeared that if a contributor provided enough “value or impact” to Index Coop, that Gold was attainable. While still possible, the opportunities to achieve Gold (outside of Priority Hiring) appear to be much more limited, and the reward gap between Gold/Silver will be quite high both short-term and long-term.

I favor and see the need for Priority Hires and DSM. Owls should feel valued and supported as we grow Index Coop and execute on future opportunities. The DSM is a positive incentive system for Owls to put “skin in the game” and be rewarded for holding $INDEX that will benefit us all.

Before supporting this proposal, I would like to hear more from those who wrote the proposal, our community to better understand the specifics around the current state of Owl Levels and DSM.


Thanks for the great idea.
Like you, I hope that the Index Coop will be financially sound.

However, as kindeagle said, I feel that this system is a bit of a leap from the current situation.
For example, I would like to know how to quantify the contribution of each level (this is relevant to all reward designs), and how the replacement of each level and the promotion of new members will be done, and at what intervals. If you have any ideas, please let us know.

In addition, you say that you will not share the names of the contributors at each level for privacy reasons. I hate to think about it, but I think there is a risk that the same person could belong to more than one level.

Hi @Pepperoni_Joe,

Some good questions have been raised away from the forum that I think are worth sharing.

  1. What is the notice period for people who wish to exit from the arrangement above ?
  2. How do you manage the departure of someone from the Coop ?
  3. Owl levels, to @kindeagle’s point, it makes sense to remove this uncertainty as it will determine eligibility for the DSM. Do we know when Owl levels are on the Index Council agenda to be resolved ?
  4. What is the minimum retention rate for the INDEX distributed through the DSM ?
  5. Can we confirm, there is no requirement for existing Full Timers to move across to this type of package ?

Also, noting this IIP draft needed have been converted to a proposal and scheduled for snapshot before today to meet the dates mentioned above. Am I right thinking this is to be discussed more and the dates are to be moved back ? (I just came back from leave and noticed the IIP number had not been requested)

Hey @Matthew_Graham :wave:

Excellent questions:

  1. As per [IIP-118] there is a two month severance period on forced Terminations. If someone wishes to exit from the arrangement above voluntarily, we would expect a 1 month notice period to be provided.

  2. Offboarding is one of the most challenging topics DAOs face, and doing it with respect, transparency and professionalism is a tricky line to tread (let’s not do offboarding like Maker). As such, one of Community Nest’s Season 1 projects is the launch of a formal offboarding framework.

  3. Community Nest will be proposing a list of C.Nest contributors, their Owl Levels and the overall costing of the DSM for this group as part of our Season 1 proposal. The Council can then provide feedback on DSM and Owl Levels as part of the general approval process for C.Nest S1 budget.

    Recognising the stark philosophical differences within the Council on inclusivity for the DSM, I would imagine this will come down to a Council vote - with the rationale behind the decision on who can access the DSM then communicated publically.

    @kindeagle I know we have discussed this topic 1:1 and so hopefully this recommended approach addresses some of your questions around wider access to the DSM.

  4. I believe this question is asking “how will we know the DSM is successful”. There are two main aspects to this:

    A. Did contributors on the DSM increase their INDEX holdings, either by retaining their salaried INDEX or by purchasing on the market

    B. What is the Retention rate on INDEX delivered through the DSM

    We are working with @anthonyb.eth and @prairiefi to establish robust analytics on both “A” and “B” to monitor the overall success of the DSM. Personally, I would be extremely disappointed if the retention rate was <65%. However, we won’t get this information for another 6 months due to the DSM vest. This means we are presently focused on analysing contributors salary retention and buying behaviour as a result of the DSM launch (i.e. A).

  5. Correct, there is no hard requirement for existing FT folks to move to the new package. Offer letters have been issued and none of the FT folks who are on the priority hiring list has chosen to remain on their existing package versus transitioning to the new framework.

Hopefully with those questions addressed, and in the spirit of 80:20, we can move this forward to IIP. This will enable us to compensate Priority Hires under the new reward framework for their January contributions.

@sixtykeys could you assign an IIP number and queue this vote up for snapshot at your earliest possible convenience?


Hey @Pepperoni_Joe, an IIP number (128) has been assigned to this proposal, and a snapshot vote has been queued to go live later today at 1800 UTC.
Snapshot here

Just noting here that the priority hires are effective from 1st February. January contributions will be based upon the Q4 budget rolled forward for January to bridge the gap between WG’s and Nests. Priority hires and associated salaries will be effective from February. Please refer to this post. Q1 2022 budgeting process for WG's/Nests

Hi @Pepperoni_Joe, do we have a description for what a Neon owl is? I’m a bit surprised that a single individual (assuming a smart contract engineer) is making almost double the next highest paid person and more than double the national average (currently $150k) for that type of position.

Is it possible to get a breakdown of what types of roles are included in each level type?


Confirming that this IIP has passed with 113K INDEX (99.95%) voting FOR :white_check_mark:
Snapshot here


If you voted, then you can still pick up the POAP. Go to Snapshot again!


Gentle reminder, all those who have accepted or intending to accept the Core Hire offering are to have communicated the address that holds INDEX to @Pepperoni_Joe prior to the 1st February. ie: Today :wink:

Based on the INDEX held within the specified address, the DSM will determine what INDEX rewards are earned. For those still negotiating renumeration, do communicate the wallet address before 1st February to be eligible for rewards.

The 1st of February is a firm date for DSM rewards accrual. The responsibility to have everything in place is on the person being hired. Feel free to reach out to either @ElliottWatts, @Pepperoni_Joe or myself if there are any concerns around the DSM aspect of this proposal.


Has the list of Priority HIres been shared publicly?