Title: Proposing a Business Development Working Group II
I am proposing the second iteration and Q3 funding for the Business Development Working Group (BDWG) for the next 3-months starting on the 1st July 2021 to 1st October 2021.
BD working group has been operating for the past 6-months, first as a vertical within GWG and then autonomously as is its own working group. The primary mission of Business Development is to develop and manage relationships between Index Coop and external parties.
Each iteration of this WG has seen significant improvements and major initiatives. We continue to fine-tune and hone our strategy as the Coop evolves.
- $7.75 million Treasury Diversification
- Partnership with SushiSwap to launch BTC2x-FLI with Onsen rewards
- Bitgo listing
- Rari Capital Fuse pool initiated
- Relationships established with all major Index stakeholders
- Perpetual Protocol trading competition
- Perpetual DPI treasury purchase
- Miami BTC Conference attended and numerous relationships established
- On-going conversations with Polygon and leading L2 DEXes
- In-depth competitive analysis of other leading Index providers
- Investor landing page and numerous investor materials created
- DeFi Summer Series conference scheduled for NYC on July 15
What we liked:
- Verticals within the WG enabled each contributor to have a high level of autonomy and accountability
- We continue to attract high leverage individuals to the WG
- Bias towards action. WG members identify and execute key Coop-wide initiatives
- Aggressive focus on building long-term relationships throughout the DeFi and investors ecosystem
What we didn’t like
- Numerous initiatives were bogged down in the Forum. We need to focus on executive-level execution
- Increase focus on core strategic priorities and cut extraneous efforts. A major focus for this WG iteration will be honing down on our core mission and improving our focus.
- Better communication with the broader Coop community around what we are accomplishing and the value add of specific initiatives
Index Coop is a business, and all business is built on relationships. The fact that we are built on sophisticated technology does not change this fundamental reality… The vast majority of crypto users, financial institutions, venture capital funds, crypto hedge funds, and potential methodologists do not know we even exist. We need business development to establish relationships and manage negotiations across all these groups. Some of these relationships may never result in significant revenue, but those that do will create major value for our protocol.
BDWG is the core WGs directly driving IC’s external partnerships and product distribution. The continuation and funding of this WG is vital for the long-term success of our protocol.
Activities that BDWG will oversee:
- Major DeFi integrations
- Recruiting and negotiating with external methodologists
- Growing relationships with major Index stakeholders.
- Direct sales of Index products to DAOs and other ecosystem partners
Note on relationship with methodologists. Currently, the Coop does not have any cohesive strategy around recruiting and negotiating with external methodologists. We will need to partner closely with the Product Working group to accomplish this.
Bringing on strong methodologists who can launch successful products with us needs to be a priority over the next year. I recognize that it is not explicitly named in the Q3 priorities. But we need a system and framework for these discussions.
I firmly believe all final decisions need to be voted on by the community, but these conversations need to be funneled through a working group. And the working group best situated for this is the working group focused on all external Coop relationships- BD.
BDWG will prioritize initiating, maintaining, and building long-term relationships with DeFi projects, crypto partners, and Index Coop Investors alongside these major strategic priorities. These relationships provide valuable introductions, advice, and strategic perspective. Developing and deepening relationships will continue to be a core focus for BD.
What impact will this project have?
- Increase in unincentivized supply growth & unincentivized AUM
- Increase in total holders
We will accomplish this by ensuring that every possible ecosystem partner, external fund, and end-user has access to our products and is incentivized to use them.
We will measure this through the metrics tracked on @jdcook’s analytics dashboard. When possible, we will work to ensure that each initiative can be closely tracked and measured. However, the reality we continually encounter across the Coop is that these metrics are extensive and direct attribution is difficult.
These are the specific numbers we are targeting for this quarter. If these numbers are not met, we will be directly accountable to the community.
- 40% of total DPI supply held on leading DeFi money markets
- $20 million of liquidity on Polygon
- $30 million of Index Coop products held by DAO treasuries
The formation of deep relationships throughout the crypto and DeFi ecosystem
We will be coordinating multiple AMAs and conference calls between the community and investors in the previous round.
We will be working closely with these investors to support liquidity for our products and drive forward exchange listings and other major introductions.
This metric is also hard to measure. Our goal is that Index Coop sets the standard for leveraging the power of strategic investors and fully leveraging each firm’s capabilities.
Recruiting and on-boarding major methodologists
This quarter, we aim to identify and recruit two major methodology providers to launch major products with Index Coop.
Succesful methodologies are perhaps the single biggest value driver for our protocol. We expect that major indexes launched with major qualified methodologists will drive significant long-term revenue for the Coop.
Working Group Leader
- Simon Judd (Discord: BigSky)
- Michael Mtenga (Discord: Mringz)
- David Silverman (Discord: TrotNixonLine)
We are requesting a budget of $140k over the next three months. This is a significant decrease from the previous cycle, a number I have cut down as much as possible with the long-term sustainability of our protocol in mind.
Rewarding high leverage contributions is our largest expense. Examples of high-impact contributions include, but are not limited to:
- Completing major DeFi partnerships
- Facilitating large sales of our products to ecosystem partners
- Recruiting major methodologists
- Producing impactful material
- Initiating and driving external engagements that generate major revenue for IC
The nature of BD is that many community members seek to join this group. We screen for the best candidates and only reward high-quality contributions. But even so, this group will naturally be larger than some other working groups and require more funding for contributor rewards.
Partnerships funding is meant to cover ancillary expenses such as Chainlink price feeds for Polygon, Airdrops for AMAs, and other small-scale initiatives.
We have increased the amount to support conference attendance. Specifically, @verto0912 and I will be attending ETHCC in Paris. I expect that between flights, hotel, and food, we will each spend ~$2.5k. I will also be attending BlockWorks Bretton Woods Conference in August; the total cost will be similar. These are the only two conferences I will attend for the rest of the year- however, I expect to fund conference attendance for other working group members.
Even with this reimbursement amount - I still incur and personally cover many related expenses for conference attendance. I do this because I believe that the return on investment for the conferences is extremely worthwhile. I will cover this more in conclusion.
(note: several other working groups have expressed interest in sending participants to conferences or hosting events. I strongly support all WG’s sending their members to conferences and hosting in-person events.)
BigSky will lead the BDWG. Each vertical will be led by core contributors with an established track record of long-term high-leverage contribution to the Coop. The working group members will be directly accountable to the broader Coop community to execute the stated objectives.
BDWG assigns stipends for regular contributors and awards discretionary payments to incentivize activities that directly enable the WG to accomplish its strategic priorities.
The BDWG continues to meet once weekly. These meetings are open to the entire community, and we encourage attendance and participation.
Our proposed total budget for the next quarter is $140k.
Over the past three months, our working group has raised over $7.75 million in funding for Index Coop, spearheaded the launch of BTC2x-FLI with Sushi Onsen rewards, developed direct relationships with essentially every major protocol, retained two of the best market makers in DeFi, conducted multiple partnerships with other protocols, successfully achieved a major centralized exchange listing, and established close relationships with a significant number of the major investment funds in DeFi, this seems like an excellent return on investment.
Building long-term Relationships.
We spent four months talking to 0xMaki at Sushiswap before we agreed to launch BTC2x-FLI with Onsen rewards. This resulted in a successful product launch and led to deep liquidity for that token. We first spoke with Assembly Capital (one of the major investors in our last round) in January. We had over ten calls over the next five months before they committed to the OTC round in May. Michael and David have tirelessly established conversations and relationships with almost every major protocol in DeFi, including every major protocol on Polygon. These relationships lay the groundwork for major future partnerships and product onboarding. Mike and Nate spoke with BitGo for months before final approval for listing DPI.
Without the time spent building these relationships, none of this would have been possible. We can’t expect investors and partners to simply land on our website and decide to buy our products. We need to go them and make deals happen. BD and IB are working extremely hard to lay the foundation for Index Coop to become a global financial powerhouse. This will not happen overnight.
Conferences and events are important for this strategy. They allow community members to meet with a vast number of funds and investors and evangelize Index Coop. Our events bring together an incredibly diverse group of crypto leaders (including some of the most influential voices in DeFi and traditional financial professionals. Many of the people at the NYC event were only loosely acquainted with DeFi, but they control massive amounts of capital. And that capital will soon be flowing into our ecosystem. We need it to flow to us.
Time and time again, at Index Coop, we see the value of relationships. Whether it is @Matthew_Graham working tirelessly to onboard DPI as Collateral with AAVE, @Kiba successfully onboarding DPI as collateral on CREAM (where over 20% of the current supply lives / additional note: Kiba was paid $1k for this under previous reward structures- this needs to change if we aim to retain top talent long term and I’m in favor of retroactively correcting this), or @DarkForestCapital and @verto0912 networking relentlessly to bring MVI to NFT and gaming communities.
BD needs funds to reward community members that drive relationships forward. Some of these community members will be the core contributors to BD, and some will be other contributors like Matt and Kiba, who have existing relationships. This is ok.
The way ahead
BD still has a long way to go. We do not have a Coinbase listing, we are still pushing hard for major DeFi integrations, and traditional institutions are still slow to buy our products. However, a tremendous amount has been accomplished in the past 6 months for Index Coop. We have built an extremely strong business development and institutional business team.
Two days ago, @Metfanmike hosted an event for Index Coop with over 200 people in attendance from every major bank and many of the major DeFi protocols. This was the single largest crypto event in NYC in the last two years. We have over 40 group chats with DeFi teams and founders, all initiated and organized by Michael and David. Not all will generate revenue for the Coop, but some will be immense value adds. Nate just got DPI approved for listing with the biggest crypto custodian in the world.
Everyone in DeFi is still figuring out what effective business development in this environment looks like. The only other protocol with a significant Institutional Business operation is AAVE. We are still figuring out what works and continually refining our focus. It is easy to sit on the sidelines and say, “I wish we had a Coinbase listing, or why are we partnering with Rari Capital instead of Maker.” I challenge anyone reading this post to find a more dedicated, successful, or hardworking team than BD/IB at Index Coop.
Despite not being fully funded during the last cycle, we achieved incredible results for the Coop. To date, our funding over the history of this working group has been the $70k left over in the exchange listing wallet from February. This has been the situation since April. The value created by the BDWG alongside the soon-to-be created IBWG is beyond question.
We accomplished all of this over the past 6-months, I’m incredibly excited to see what we do over the next year.
@Metfanmike and @fallow8 have proven themselves to be extremely capable professionals over the past five months. They work tirelessly for the Coop. The results created over the past three months speak to this. The value of an Institutional Business working group is clear. Major institutional capital has not yet fully entered DeFi, but it will. And when this capital does, we want our protocol to be positioned as the landing spot. We will have fierce competition for institutional capital as many traditional ETF providers rush to create crypto indexes. If we are not positioned from the outset to compete in this space, we will fall behind.
The reality is that I do not have the capacity to accomplish all the goals listed above and also oversee Institutional Business. Establishing this working group will allow us to compete and win in the battle for the billions and billions of dollars of institutional capital entering crypto. People thrive with autonomy and responsibility - Mike and Nate have earned my deep respect and I trust them completely to execute as strong working group leaders for the Coop.
If you made it this far - thank you for reading and supporting BDWG.
I am committed to Index Coop principles 1
I am committed to serving the entire Index Coop with my work.
I am committed to open, rapid communication: I know that clear, constant, public communication lifts up the entire Index Coop community. I am committed to this style of communication.
Shared learnings: I will share my progress, learnings with the entire community. I will ensure that anything I create is accessible beyond my own tenure for future generations of Indexers to access & build on.
Intellectual honesty: I am committed to growth and improvement. I am open to feedback and will use feedback to improve my work for the benefit of the entire Coop community.
I am committed to making Index Coop a welcoming, fun, and engaging community to work in!