The Index Coop is a Startup

A startup is a company focused on creating a new way of doing things and designed to grow fast. To grow really fast requires a company to (a) make something lots of people want, and (b) reach and serve all those people — Paul Graham, Startup = Growth

The Index Coop is a startup :rocket:

We are creating a new way to launch, grow, and maintain trustworthy crypto assets, and we are trying to grow fast by making those products simple, safe & widely accessible.

So what?

I believe that if we think like founders and apply proven startup principles, we increase our chances of ongoing success. It is one lens to apply to what we are building together.

For folks who are excited to learn, talk about, and apply startup principles to the Coop, here are 7 blog posts and 6 books I believe are fundamental for developing the startup mindset :owl:

Blog Posts


If you decide to start reading any one of those, please let me know :slight_smile: I’ll reread it too so we can talk about what we’re learning and how we can apply those learnings to the Coop.


Thanks @gregdocter ! There’s some reading there to cover a few weeks, some I recognize, some I don’t. Interested to to get stuck in!


Thanks for the reading homework! May take a bit longer to get through any books lol


Thanks @gregdocter this is awesome. I’m glad we are sharing readings and lessons for IC.

One of the major drivers for my thinking lately has been the works from economist Bengt Holmstrom. This has shaped how I think about our IIP-32: Index Sale and the SYI - Stable Yield Index.

  • He has a really good paper called Understanding the Role of Debt in Financial Markets. In the paper he argues that debt is fundamentally different than equity and built around diametric opposed logic. Equity aggregates risk across market participants, while debt creates liquidity.

  • Debt acts as a damper on volatility. Much of the volatility in current crypto markets comes from the fact that these markets are almost purely equity. Bitcoin does not have a native financial system built around it. This means that significant liquidity demands directly result in price discovery as BTC holders sell their assets in exchange for liquidity. In DeFi we are in the very nascent stages of developing sophisticated debt markets - as these markets develop they will help smooth out some of cryptos volatility.

  • For the stable yield index (@Matthew_Graham ) this intersection of debt and volatility is super important. When we tranche risk we are really categorizing debt/yield by degrees of information sensitivity. High-quality debt (AAA in traditional finance) is the least sensitive to new information.

  • When debt is sufficiently over-collateralized price changes of the underlying collateral do not matter very much. On the other hand, when debt can be under collateralized, it becomes highly information sensitive. Any new information on the price of the collateral can trigger a default. This dynamic explains the dichotomy between stability and urgency in debt markets. Most debt is highly over-collateralized to ensure maximum liquidity and stability. Trading can occur with minimal information from both parties. However, the value of information for debt when it is close to default or under-collateralization becomes very high. Thus, any new information can lead to a default on the debt, creating a sudden high degree of urgency.

When building different tranches in the Stable Yield Index we are essentially categorizing yield by its volatility / exposure to market based fluctuations with the most stable yields being the lowest risk and the least stable being the highest risk.

This has also changed how I think about our treasury diversification - by bringing in stable assets in exchange for equity we are dampening volatility and lowering our exposure to price discovery. This should lead to steady long-term growth in a way that cannot be sustained by a remaining 100% equity funded.

Another paper that has really shaped my thought over the past few months is "Crypto Wants to Be Seen," Op-ed By Kayvon Tehranian - The Defiant - DeFi News . The conversation around how much crypto can be abstracted away remains extremely relevant. During conversations with traditional funds we see are seeing a big desire to hold assets on chain - a desire that directly results from these firms having a better understanding of crypto itself and wanting to control these assets. I think we overestimate how much abstraction is needed - these funds are willing to learn and quickly growing comfortable with on-chain custody and interactions.

Excited to hear what everyone else is reading and how it applies to the Coop!


The Tren Griffin article on proprietary distribution is really good


that article is really cemented in my brain…

  • “Proprietary product distribution” is a customer acquisition system that is within the control of the business itself and which generates a customer relationship that the business owns.
  • Paying too much to acquire customers is not a solvable problem. But not paying anything to acquire customers is not an option for a real-world business
  • A business does not produce a grand slam home run for founders and investor by only acquiring customers with paid product distribution. That does not scale.

Great reading suggestions, @gregdocter. Adding one more, which really impacted my thinking on executing on big goals: The 4 Disciplines of Execution, by Chris McChesney (5-minute video summary here)

The book sets forth 4 disciplines for executing well:

  1. Focus on the wildly important goals
  • What are the 1-3 goals that matter above all else?
  1. Act on lead measures
  • The book distinguishes between “lead” measures and “lag” measures, which I think is a really important distinction. Lead measures are the activities which drive or lead to the lag measures (eg., if you’re a door-to-door salesman, the lead measure is the number of doors you knock on (something completely in your control); the lag measure is the number of widgets you ultimately sell (you can influence this but not in your control)
  1. Keep a compelling scoreboard
  • People are more effective and more incentivized when you are able to measure progress (especially if you are focusing on the most impactful measures)
  1. Create a cadence of accountability
  • Accountability reorients people to the wildly important goals and creates trust

Interesting! Thanks for sharing these.

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Great resources. As someone new to the DAO, I suspect that these are going to be incredibly helpful. Beyond these specific blogs and books, are there any ongoing resources that are noteworthy? Perhaps a curated list of insightful newsletters? Thanks!


that’s a great question – here are a few insightful newsletters/blogs that come to mind:

Super curious if folks have better/different recommendations for insightful newsletters.

I don’t consume that many startup newsletters* these days and instead rely on this Twitter List to feed me Web2 VC & Startup info.

+1 on all the above

I’d add:



:heavy_plus_sign: to Stratechery & Brian Balfour & Starting Greatness

@LemonadeAlpha for “Operators” – any particular episodes stand out?

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I really liked the Morgan Brown one!

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Combining some thoughts from “Proprietary Product Distribution” and “A dozen lessons about product/market fit”:

“Proprietary product distribution” is a customer acquisition system that is within the control of the business itself and which generates a customer relationship that the business owns. Owning the data generated by this direct customer relationship is increasingly valuable…"

In crypto, on-chain data is open. Most of the data about our “users” is not owned by anyone but accessible by all. This is also true for markets. Anyone can see markets forming, dissolving, growing, and failing if they know how to evaluate the data on-chain. It is markets that are most important.

“product/market fit means being in a good market with a product that can satisfy that market.” But too often the focus is on latter part of the sentence (a product that can satisfy the market) and not the former (in a good market). Andreessen emphasizes that market matters most : “You can obviously screw up a great market — and that has been done, and not infrequently — but assuming the team is baseline competent and the product is fundamentally acceptable, a great market will tend to equal success and a poor market will tend to equal failure.”

Obviously, I am thinking about things through an Analytics lens (I guess that is just what I do) - but this is why an analytics function is valuable imo, and core to the Coop’s success. We have a long way to go to get here, but we need to be the best at identifying markets for financial products. Hopefully we can continue to build out tools that will allow us to react faster to data than any other DAO. I think the product working group is also building muscles in this area, led by recent efforts around the FLI suite, and the upcoming SYI product.


Love this thread & startup talk in general :slight_smile: sorry I’m late to chime in!

Two other reads I’ve used as inspiration in past startup gigs:

  • Creativity Inc – particularly relevant to the “creating a new way of doing things” part of a startup. Talks a lot about how great teams = great products; though it speaks from the view of a traditional manager → team relationship, I can see some emerging DAO parallels…
  • MVP is a Process, not a Product – this is something I live by as a software product manager but have struggled to apply to on-chain products. Would love to brainstorm on how we can apply MVP-style thinking to this space.
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