MIP40c3-SP50: Modify Core Unit Budget - Maker Talent (MT-001)

MIP40c3-SP50: Modify Core Unit Budget - Maker Talent (MT-001)

Preamble

MIP40c3-SP#: 50
Author(s): @manomad_ 
Contributors: @synesthesia
Tags: core-unit, cu-mt-001, budget, dai-budget
Status: RFC
Date Applied: 2021-12-08
Date Ratified: <yyyy-mm-dd>

Sentence Summary

MIP40c3-SP50: adds the DAI budget for the Core Unit MT-001: Maker Talent.

Paragraph Summary

The Maker Talent CU budget is designed with the following goals in mind:

  • To pay the DAI compensation to Core Unit members.
  • To sponsor events where Maker Talent will meet potential candidates.
  • To pay a part of the referral bonus as an incentive.
  • To pay the operational costs of the CU (e.g., candidates management software, gas fees and job advertisements).
  • To mantain a reasonable buffer for unexpected expenses (legal, financial and other).

Specification

Motivation

Going by the critical nature of the work done by the Maker Talent Core Unit, sufficient funds need to be provisioned in order to guarantee the success of the Maker ecosystem in the long run.

Core Unit ID

  • MT-001

Budget Implementation

The budget implementation will follow standard best practices as recommended by the SES Core Unit and will involve a setup with an Auditor wallet and an Operational Wallet which will be topped up on a monthly basis with a 3-month runway. The budget cap will be streamed from the protocol to the Auditor Wallet to reduce as much as possible the overhead for Maker governance.

The MT-001 budget is designed with the following in mind:

  • Paying for the operational costs to run the core unit.
  • Provide the protocol control over funds held in the Auditor Wallet.
  • Reduce governance overhead to a minimum.
  • Provide full transparency and be kept in check by a group of trusted auditors.

Therefore, a vote to ratify this MIP means MKR holders make a commitment to:

  • Streaming the annual budget for MT using DssVest for 1 year.
  • A continuous funding model based on the SES top-up mechanism.

Multi-sig Wallets

The following multi-sigs are involved:

  1. The Auditor Wallet – A nested, 2-out-of-2 Auditor multi-sig, composed of 1-out-of-2 role based multi-sigs as signers. The Auditor Wallet will have 2 roles defined for its signers: Auditors and Accountants.

    The Accountant Role Multi-sig will have 2 signers—both SES permanent team contributors. The Auditor Role Multi-sig will also have 2 signers, also both SES permanent team contributors. SES will conduct the monthly auditing process as described in the Monthly Top-up Cycle, increasing transparency of the auditing process for the community.

    The Maker Protocol (MCD_PAUSE_PROXY, 0xBE8E3e3618f7474F8cB1d074A26afFef007E98FB) will be listed as a beneficiary on the Auditor Wallet. This allows the protocol to withdraw up to 1B DAI from the Auditor Multi-sig wallet, ensuring control over these funds and acting as a backup.

    This multi-sig will hold funds up to the Quarterly Budget Cap in DAI and receive the DssVest stream. All funds pass through this wallet before any are sent to the Operational Wallet.

  2. The Operational Wallet – One wallet for MT operational expenses. This is a 1-out-of-1 multi-sig controlled by MT. Signers include the facilitator and an additional signer will be added as the core unit grows.

Monthly Budget Statement

Within the first 5 days of each month, MT will submit a Monthly Budget Statement to the signers of the Auditor Wallet with the following sections:

  1. Previous Month Actuals – The actual expenses (DAI and MKR) of the month that just ended.
  2. Budget Forecast - A forecast of the Dai amount required to maintain a 3-month operational runway for the team based on the latest available information.
  3. MKR Vesting Overview - A schedule of the expected MKR vesting amounts for the current team configuration, grouped by the pay-out month.
  4. Transactions
    • The required DAI amount sent from the Auditor Wallet to the Operational Wallet to replenish the 3-month runway as indicated in the Budget Forecast section.
    • Any excess DAI amount above the 3-month forecast in the Operational Wallet that will be returned to the Auditor Wallet

The Monthly Budget Statements can be found in this GitHub repository.

Monthly Top-up Cycle

  1. Monthly Budget Statement Submission – Within the first 5 days of the month, MT submits the Monthly Budget Statement to the Auditor Wallet signers. This report is also available for the rest of the community to review.

  2. Transaction Requests Submission – In parallel, MT submits the necessary transaction requests for the Auditor Wallet signers to sign:

    • DAI Top-up Transaction – One DAI transaction for the Operational Wallet that adds enough funds to the Operational Wallet to replenish the forecast 3-month runway. Only applies if the Operational Wallet balance is below this forecast.
  3. Returning Excess Funds – MT creates and signs any transactions for excess funds that should be returned to the Auditor Wallet:

    • Excess DAI Transactions – DAI transactions for Operational Wallets that have a balance above the 3-Month Budget Forecast will be returned to the Auditor Wallet.
  4. DssVest Pull - The Auditor Wallet signers will pull available funds from the MT DssVest contract, replenishing the available funds in the Auditor Wallet.

  5. Auditors’ Review – The Auditor Wallet signers review the Monthly Budget Statement. First, Accountant Role signers will review the initial report submitted by MT to ensure data accuracy and report completeness. A consistent audit checklist will be followed. The Auditor Role will then receive the Accountant’s report generated from the checklist, and verify the Accountant’s findings.

    A summary of each audit cycle’s report will be made available to the Maker Community at the conclusion of the audit cycle on the MT’s transparency reporting repository on Github.

  6. Transaction Approvals – Upon acceptance of the Monthy Budget Statement audit, an Accountant Role signer and an Auditor Role signer will sign the requested transactions, sending the DAI top-up amounts to the Operational Wallet.

  7. Auditor Wallet Returns – The Auditor Wallet signers will return any amount of DAI above 2x the Monthly Budget Cap. The Auditor Wallet, using the DssBlow contract described here, will return the excess DAI directly to the surplus buffer.

    As such, the Auditor Wallet will then hold up to 2x the Monthly Budget Cap at the start of the month, allowing DssVest to stream DAI up to the Quarterly Budget Cap over the course of the month.

Auditor Wallet Configuration

To enable this payment flow, the following configuration of the MT Auditor Wallet will be required.

  • Accountant Role Wallet (0xA2A855Ac8D2a92e8A5a437690875261535c8320C) as a signer
  • Auditor Role Wallet (0xB2da57e224949acDDe173a5b8A8160c023ea86e6) as a signer
  • Add MCD_PAUSE_PROXY as a beneficiary, with an allowance of 1B DAI withdrawal.
  • Configure required confirmations as 2-out-of-2.

Transactions

  • Initial Seed Transfer
    397,255 DAI will be transfered to ‘TBD’ Address on Date 2022-2-1.

    This seeds the Operational Wallet to 3x the Month Budget Cap. This also initially funds the Auditor Wallet to 2x the Monthly Budget Cap. The initial transfer funds the Operational Wallet, enabling the Core unit to begin operations. This also then positions DssVest to begin streaming funds up to the Quarterly Budget Cap each month in the Auditor Wallet.

  • DssVest Stream

    A total of 953,412 DAI will be streamed to ‘TBD’ starting 2022-2-1 and ending 2023-1-31.

    (953,412 DAI is calculated as Quarterly Budget Cap x 4 = 238,353 DAI x 4).

Budget Breakdown

Nearly 30% of this budget is allocated to variable expenses that are impacted by the demand of profiles (i.e., the more openings we have, the greater the budget that will be spent on posting offers, expanding our team of recruiters and even paying more referral bonuses).

On a quarterly basis, the budget is composed of:

Budgeted Item Monthly Total 3 Months
DAI Compensation 34,541.70 103,625.11
Events 21,493.83 64,481.50
Job Offers 1,788.33 5,365.00
Recruitment Providers 1,459.67 4,379.00
Software Licenses 3,273.52 9,820.56
Others (e.g., gas fees) 6,530.80 19,592.40
Subtotal Without Buffer 69,087.86 207,263.57
Buffer 15% 10,363.18 31,089.54
GRAND TOTAL 79,451.03 238,353.10

DAI Compensation

Represents the compensation made to the members of the Core Unit. At full capacity, this Core Unit will have 4 FTEs and 2 external contractors.

Events

Maker Talent is planning to acquire sponsor tickets for a minimum of three major events and three minor events per year.

Job Offers

This includes posting job offers across important blockchain publications and sites.

Recruitment Providers

This section includes occassional lawyer services (e.g., GDPR management), a co-working space, and payment processing services, among others.

Software Licenses

Includes an ATS subscription (Applicant Tracking System), a subscription fee to the Linkedin Search Engine, G-Suite, Notion Wiki and hosting, among others.

Others (Gas Fees, etc.)

Includes a welcome pack for new joiners, gas fees, and a contribution to the referral bonuses paid.

1 Like

It looks like the bulk of the fixed cost is DAI compensation for permanent employees. I understand that your budget needs to capture the maximum cost of your activity. Do you plan to be at full capacity at launch? If not, what does your launch staffing look like? It might be helpful to also include a skeleton budget that tries to approximate the minimum operational cost of your unit.

Others have expressed concern about your proposed budget.

1 Like

Minimum operational structure is what we have now, me as a facilitator and one external recruiter. The more positions we need to handle, the more people we will hire. That usually depends on the complexity of the job. A recruiter can handle between 5-8 tech positions.

When it comes to budget, a typical agency charges between 15-20% of the annual compensation of the contributor. Maker Talent will be fully covered by the protocol (it will be free for the CUs), unless the CU uses and external agency, in which case they will be paying the invoice. With an “agency approach” you receive candidates on demand, our idea is to create a great database we can all use.

1 Like

Thanks for your comments @MadShills

At full capacity roles are: 1 FTE x Candidate Experience Manager (Coordinator), 1 x FTE Facilitator, 2 x FTE Tech Recruiters and 2 externals working on events and social media for 10 hs. per week. We will include the different team growth phases on the MIP so you can see the way we can expand based on the number of openings the CUs request to us.

When it comes to events… a sponsor ticket of a Blockchain event can cost 20k-40k or more. At Maker we are only doing a few side events and a few talks per year. We need to do more to make ourselves visible to more potential candidates.

btw I had to google what a rolodex was :joy:not sure how this decentralized futuristic tool will take us to web3 top notched developers, but I trust you :stuck_out_tongue_winking_eye:

can we reduce the amount of the travel or at least call it moonshot fund or moontshot travel?

maybe change business class for spirit airlines

Hello @Deimos :slight_smile:

Flight tickets represents 10% of the event budget, the other categories are:

  • 3 Tickets to sponsor big events.
  • Sponsorship of small events (by doing webinars, meet-ups, etc).
  • Shipments and Courier costs.
  • Printed Materials (flyers, dossiers, etc).
  • Entrances and accreditations.
  • Stands for venues (chairs, desks, flip-charts… all you need to rent).
  • Merchandising, (stickers, business cards, lanyards, etc).

All the traveling costs are forecasted for low cost and/or economy seats.