[Discussion] MakerDAO Contributors compensation brainstorm

With the coming of the self autonomous MakerDAO, there will be a need to compensate contributors directly from Maker funds. An initial foray is done with the Vault Compensation Working Group Payment.

That leads to many questions.

How much should a MakerDAO contributor be compensated?

Should domains be differentiated?

Should contributor location play a role?

What kind of transparency are we expecting?

and probably much more…

I think we should already start to think about that. Especially when you read the comments like the one below. It makes sense for people currently working for the DAO to know how things will evolve. I’m not innocent in this (see my application as domain facilitator). If we want to onboard contributors full time (and ask them to leave their current job), a bit of projection is needed.

Personally, I’m a big fan of how Buffer is fully transparent or how Basecamp. Yearn is more empiric with quick changes. I also don’t think contributor location should play a role (but I can see arguments why it should). I would suggest that all facilitator have the same compensation. While not agreeing, I can also understand that some persons might want some privacy on their compensation.

For other contributors they might be compensated using some benchmark. For very partial contributors, we can continue to use the Foundation Grant rate (60 DAI/hour). Alternatively, we can delegate that to domain facilitators so that they do as they see fit.

For the micromanagement issue, I think a good balance need to be found. I’m on the side on trust but verify. Domain Facilitators should be left with autonomy with broad indications from the governance and full transparency on what is done. But managing every dollar and/or every recruitment is not helpful.

Many items to unpack, but feel free to pick one or two and provide your view.

11 Likes

What’s it gonna take to have a Domain Facilitator in charge of HR that is allotted a monthly/quarterly budget from the DAO which they can use to hire/pay DAO employees? They can then ask for more budget every cycle. As well then employees can deal directly with the facilitator and negotiate salary independent and privately from the general public. As long as the HR facilitator produces reports on performance/compensation and is held accountable then it should be good.

2 Likes

That would be the Operational Support Domain that we already have with @amyjung (and soon @juanjuan). I found that a bit centralized that one domain has the ability to set compensation (and workforce hiring) for anyone independently and privately. Also they would be accountable for the performance of MakerDAO as a whole then?

3 Likes

I agree that a hybrid approach will probably be optimal.

1 Like

I think this is solving for two different problems - decision making and recourse. If MKR holders have some form of recourse to dispute a specific decision, I think we could find a nice balance.

4 Likes

This is a really important topic and it’s definitely something we need to start exploring sooner rather than later. I think logistically, setting up different silos (or teams) and approving a budget for them to use internally (with all payments documented and explained) makes the most sense. This allows teams the freedom to spend up to what the community allocates, without the need of waiting for a bunch of participants to weigh in over every salary and expense decision. Since the reports of all spending would have to be annotated and made public (perhaps through the forum, maybe on the weekly G&R meetings) the community could still audit and slash budgets that bloated and being wasted. The DAO would still be fully in charge under this scenario, but kinda like with DCs, we would be setting a what we think is a reasonable budget and then monitoring how effectively our perimeters are allowing it to be used. By tying the budgets to a % of SFs we could also reasonable account for some growth within the system and community.

Curious is any of that sounds counter-productive/ would erode the power and importance of the DAO. IMO, it allows for the most freedom and in theory more people to get paid positions and grants as the leaders of the silos/teams will naturally want to bring on more hands to cope with the tremendous responsibility of say Risk Management or Community Development

6 Likes

@SebVentures. Maybe a naive and stupid question

Do you have an organigram, or something similar to see how things are organized

What do you mean by Domain Facilitators ? is it a moderator ?

Who can ask thant ? for what type of role ?

I have to say that i’m a bit lost with the organization here

@prose11 What you are saying is indeed one way of doing thing and it is governance who decide how governance wants things to work. I must note that your proposal makes the compensation of everyone public (again no judgement here, just highlighting it for the discussion).

Nope. Sorry. Would be fine for someone do that tho.

A domain facilitator is someone mandated by the governance to manage(?) a domain (which is a business function). You can get some information in MIP7.

For the grant, you can get more information here. I don’t work for the Foundation so I don’t know much more.

That is an important note @SebVentures. I think in general for the DAO to function there needs to be a pretty high level of transparency, and dictating what someone is being paid does effectively take away their anonymity in such a tight circle. It’s a tough decision to make, but if we are to give the DAO the full power over all the Maker functions they will have to know where the money is going. Perhaps we can break down payments to different groups of people so it’s a bit more hidden but doesn’t affect the ability for community members to audit?

1 Like

Yes it would be amazing. Maybe there is already something like that/ Personally i’m a bit lost between the foundation, facilitator , moderators , external grants. And what is the role of who ?

As @prose11, transparency is key for a DAO. I also think it’s ok to give a budget to some people (multi-sig) and they use it as they want. Of course every month or quarter they write a report so members can see and propose changes if needed. But it’s also nce to give some freedom , so things can go faster and you remove a lot of micromanagement

1 Like

I agree completely. I think that strikes a fair balance, and also leads to some accountability for the multisig. If they are not detailing their reports or producing results the community will naturally lower their budget. Especially if we require 3 people to be in agreement for dispersement we’ll drastically cut down on potential fraudulent payments

1 Like

@SebVentures I agree this is an important topic for discussion. The move from an existing structure people work and have contractual relationships with (the Foundation) to a more “ethereal” notion (the DAO) needs to be unpacked so the transition goes as smoothly as possible for everyone.

Personally, I can see at least two dimensions or levels to the conversation. Both have a variety of questions to be discussed and worked through:

  1. the DAO human resources strategy
  2. the team level (domain) relationship and ways of working

On the DAO HR side, I think it’s where questions such as those related to compensation, location, team seniority etc come into place. The people of the DAO along with team/domain facilitators will need to agree on what direction and position the DAO wants to take for its future and how the DAO wants to be perceived as. I think some leading questions may be things such as:

  • Is it important for us to bring talent from a single location or from across the globe?
  • How senior or junior do we want our teams to be? What mix of seniority do we want in them?
  • Do we want skills and competencies to be compensated for or not?
  • Does the DAO envisage creating mechanisms so teams are continuously up-skilling and remaining on top of their industry or not? How does it plan to nurture this sort of culture? Or will that be a team/individual level nurturing?
  • How much granular transparency do we want teams compensation to be?
  • Does the DAO want its compensation to be reviewed at intervals of time (e.g. yearly) to adjust for cost of living (i.e. Inflation)? For example CPI index adjustments? Which CPI will be used?
  • Does the DAO want to benchmark itself against any market rate for skillset and seniority or not? Which benchmark will the DAO use?
  • Does the DAO want to compensate performance? How will the DAO measure it? At what level do we want performance to be compensated: individual, team or both?

These are really just some initial strategic questions on the DAO side. I don’t necessarily think there is right or wrong on any of these choices. But depending on how the choices are made they are likely to position the DAO internally and externally. In the long run, I think they may determine the level of “attractiveness” of the DAO to future contributors. Well, at least for those considering to dedicate themselves on a full time basis to the project.

Tagging @amyjung and @juanjuan for considerations in ops discussions.

On the team/domain side of things, I think the conversation is probably more concrete and impacts people directly on an everyday basis. I think different teams may take different routes in how they want to design and nurture a “team culture”, most with pros and cons.

This touches on the micro-managing vs democratically led teams.

I personally think teams with high trust, high level of transparency, with a high degree of collaboration (and the environment they nurture for it) and continuous peer review (respectful, humble and open) tend to perform better and innovate more. Also, I think these teams tend to be very motivated as all peers learn from each other and everyone is keen to complement weaknesses with other people’s strengths. From personal experience, I also think these teams tend to be more sustainable in the long run. Because they are not only focusing on performing well together but also on strengthening their relationship with each other. All for the betterment of the team.

This is all good and such. But it’s not all flowers. I think this type of “team culture” requires way more effort in a decentralised DAO team than on a group working under the same roof.

  • First, most team members have never met in person.
  • Second, each member brings his own background and ideas/expectations of how work is done.
  • Third, perceptions of hierarchy can vary hugely between companies and even countries, from completely flat to industrial-style organigrams.

This last point can impact quite a bit on communication styles and perceptions of it and, eventually, how teams can create that awesome culture or none at all. e.g. What is considered “normal comms” for some can be viewed as super rude for others and so on… Here is just a funny example of how things can play out (you’ve got love British DAOplomacy)… :slight_smile:

Screen Shot 2020-12-13 at 9.25.57 PM

All that to say, I think teams probably need to set some expectations and “common standards” together (call it team rules) that they use and nurture in order to create a great team culture. And also make sure teams have, if need be, more difficult conversations. But all in a respectful and diplomatic matter (the British are masters in this kind, sorry for the admiration :wink:)

Hope this contributes to the discussion :slight_smile:

8 Likes

Thanks for starting the thread @SebVentures

Operational Support was proposed with the intention that when it comes to running operations, Domain teams try to stay as autonomous as possible. Operational Support would provide best practices, data, research, and support in case domain teams don’t have operational personnel. Having one Facilitator/team to pay all employees is not a great idea from the decentralized point of view, but I agree Facilitators should negotiate and manage salaries of general contributors and contributing team. What we want to avoid is having the DAO negotiate/vote in every salary individually.

However, Operational Support can be the third party auditor - reviewing and monitoring domain budgets, as well as be responsible for providing benchmarking data (If no HR domain team exists) on market rates.

Great framing and questions. There’s a lot to unpack when it comes to onboarding and nurturing talent in general.

CCing @MakerMan who I know has been thinking deeply about this :wink:

2 Likes

Would be curious to see this table for a conversation between a Japanese and a French/Italian/Spanish … I had to deal with different cultures and it’s sometimes very “funny”

1 Like

So what is the path forward for decentralizing payroll structures? I heard in the G&R call that you’ve been doing a lot of research on this topic. Would love to get some insights on the future direction of this topic.

So you’d have separate Domain teams with a leader and they would negotiate a lump sum for their team which they would be in charge of doling out? At scale that still presents the same problem no? I guess you could have 50 Domain teams all submit a compensation report each quarter and then we’d have another team of auditors package that up and present to MKR holders to vote on releasing that DAI to each team?

All in all, interesting stuff to ruminate on. Looking forward to seeing this play out.

This is a fundamental subject. MakerDAO will growth depending of the quality of talents attracted, their retention, capability to own autonomously tasks, all of that depending more or less of the compensation they receive.

Reducing agency problems will be done by keeping the most decentralized design, increasing the competition between potential contributors. HR or any other employment contract type of compensation is then forbidden.

I support ownership for contributors with clear mission/project implementations call for projects.
I see 2 main type of projects development :

  • Project voted by governance
  • Project proposed by external contributor

Both type requires different frame work for vote and compensation.

Project voted by governance

  • One project owner
  • Team composed of members selected by governance (grands électeurs system)
  • Hourly rate different for each member
  • Due date + Acceptance criterias
  • Bonus depending of task quality execution

Project proposed by external contributor

  • Common framework with project infos
  • Team members responsible for project development
  • Potential number of hours necessary
  • Due date + AC
4 Likes

There is a conflict between “own autonomously tasks” and “Team composed of members selected by governance”. If you don’t even select the team that you are supposed to complete the project with that’s not a good start.

On the project side (but depend on the exact definition of a project), more than half of the company costs are not really related to formal projects, it’s more keeping the company running and investing for the long run. And most of the projects are not formalized because they are either too small (and formalization takes more time and just add delay) or too ill defined. For instance, you expect full time workers to attend to the gov & risk weekly meeting. It adds a lot a coordination benefits. But it’s not a project. You expect @NikKunkel to solve the oracle issue without asking permission first.

Just taking the last example DAI Monitoring Dashboard do we really want to make that a project voted by governance and the team defined by governance after listening to different solution providers (and maybe following a MIP process)? Or do we want the end user, @primoz, do the job of solving his issue within its budget?

There is an insanely good HR deck from Netflix.

3 Likes

I think you hit the ball on the head with the above statement P-Rose! One of the main dynamics is allowing “silos/teams” to use resources to their advantages, allocating budgets that retain talent–But their needs to be a counter-balance to make sure it is not unfair comparable to other “silos/team”.

I think All-in-All we can trust the community to do really well when it comes to an operations unit and internal controls. We can get it done and it will be a success. Our community is capable and willing. Sure there will be some bumps in the road–however, we can ALL figure it out, together as one.

From across the Globe IMO

I would Love for it to be Senior–led by the current Team Leaders. Personally, super happy with the current Team members–would love to onboard old team members back into the DAO–but just my opinion. I just can’t imagine losing the current team members. Too good.

Absolutely

As P-Rose mentioned above–every “silos/team” should have the ability to innovate and create. I trust the Culture of our current Teams to be top-notch–innovative–staying on-top of things. If today I was at The Battle of Okinawa, I wouldn’t want anybody else but our current Teams to be next to me fighting for what we ALL believe in. And that is the truth!

IMO compensation should be the best that DAI can buy.

Ooof. This is worst than working for Jeff Bezos :sweat_smile:

Yes, and I am 1000% sure we can find the best of the best “market rates” if we do the research. I know a few headhunters in NYC.

You and I both know it’s always good to incentivize properly–this is something the community can discuss later on–IMO the most important components are to get it done in a way that works, and achieves the bigger picture. Time is ticking and we need to move forward. I totally believe we can commit and move forward efficiently with simplicity and honor.

3 Likes

Super nice conversation here as always. Some people seem to be very aware about this organization of the DAO.

Could you please also check this thread ?: [Discussion/Request] DAO's Organigram

Is there a multi-sig here ? Because for this type of question, allowing a budget , voted by the DAO, to the multi-sig can work nicely. And you don’t have to create a proposal. In can be seen as a “black box” , but the budget is decided by the DAO, and at the end the multi-sig as to share what they did with that money. So the DAO can decide the budget for the next period. And things can be faster as you don’t have to ask the DAO every time, create a proposal, a vote …

My whitepaper work has a scope that covers this both from an organizational/collective standpoint as well as the personal standpoint. It is the how organizations meet in the middle with the people that is the key aspect. Rather than try to layout what I am working on and being incomplete and unfinished lets start with where I started before.

The foundation has a staff and salaries for functions - is the DAO ever going to get a report of what these look like? I still have no clue who does what, for how much, on the foundation side skipping grants or other outlays that are more PR related that may or may not get something done (hack-a-thons etc.)

Barring the above (as I honestly don’t think the DAO is ever going to get any kind of report much less a Foundation audit) the DAO basically is going to have to investigate what has been done, and then propose its own organizational structure. All organizations have some key components that can be defined in an org chart of authority/responsibility structure which is what is required. Someone is going to have to put a proposed MakerDAO org chart together and present it. Ideally this org chart includes authority, responsibilities with budgets and lists of positions. Feed back, quality assurance and transparent accounting metrics will need to be put into place both on the work done side and payment on work side.

What everyone is struggling with is the how to report work, work grading/valuation, then distributed payment metrics based on budgets that have varying levels of funding. From the DAO side this involves a lot of extra work as compared to a standard company (lets skip governance wanting to get their grips on the knobs of this functionality). From the worker side the added complexity of having to not just do work, but make an accounting, and deal not with a single boss but governance poking in to micromanage affairs adds a whole bunch of overhead, stress, and complexity. Employees like brian above are going to weigh work not just against compensation, but stress, hassle and what i consider a bigger problem. Lack of job security, basic benefits, retirement, vacation time… All the things that come with a normal job. Including unemployment compensation, taxes, SSI (in the US), etc.

In the work world from an employee perspective, we have unions that protect our rights, negotiate compensation contracts, and laws that make it a little more difficult for employers to just terminate our employ or little to no reason. Ask a basic question. Do I want to deal with one or 5 different bosses? Am I going to want more or less pay to take on a job that could be highly variable that I could lose with less than 24hr notice, that doesn’t have vacation or any forms of benefits built in (medical, retirement, sick, paid vacation leave, etc.)

These are but a few of the issues that have to be dealt with. From the organizational perspective we have to consider not just finding, hiring, and training people, but retaining them, compensating them at their market rate. Committing to them as much as they are committing to the organization over more than a 1 to 3 month billing cycle.

2 Likes