How we come together online is changing at the speed of light.
Before the global pandemic, remote work, virtual concerts in the metaverse, and Discord servers thousands strong were only a curiosity. Now they are the norm.
We are living through the single most important shift in human connection in recent memory.
DAOs exploded onto the scene in mid 2021, but the foundations were laid long before. COVID-19 made remote collaboration the norm, GenZ is seeking independent online entrepreneurship and employment, and crypto infrastructure has become mature enough to support mass adoption.
Web3 promises a future state of the Internet that is collectively owned by its users, where value is distributed fairly to those who create it, and where there is no room for walled gardens, strong-armed monopolies and belligerent platforms.
If Web 3 is the what, then DAOs are the how.
DAOs are the organizing principle of Web3, and the vehicle through which everyone can be an owner and a contributor to the projects that matter to them. Web3 is about individual ownership, but those owners need to somehow come together and collaborate or nothing great will be built.
DAOs enable independent individuals to come together around a common goal without the need for a central, trusted entity. While their level of autonomy and decentralization vary, the core principles and culture of DAOs empower individuals to collaborate via shared incentives and trustless rules of operation. They unlock human potential by removing barriers to cooperation and will lead to an explosion of innovation.
We believe in the power of DAOs not only because they are essential in bringing about a decentralized internet, but also because societal shifts have made the rise of DAOs inevitable.
Online communities have exploded in recent years, partially as a response to the era of passive consumption on platforms like YouTube and Instagram, and partially because connection and belonging is a basic human need, and digitally native internet users are pushing it further into online spaces.
If coming together online has been a slow growing trend over many years, working together online is clearly the opposite – COVID made this the norm for millions of people from one day to the next.
The global pandemic turned work on its head, not only precipitating the shift to remote work as default, but also bringing about a mass exodus of employees in ‘The Great Resignation’. Independence, flexibility and purpose are becoming more important than ever. More than 50% of GenZ Americans want to start their own company in the next 10 years.
The final trend is perhaps the most important: everyone wants to be an investor. The next generation is financially literate, has the tools (read: apps) in their hands, and a firm distrust of government and institutions. They not only want the independence and flexibility that entrepreneurship provides, but also the financial upside.
DAOs combine community, ownership, work and fun with a healthy dose of subversiveness. While we believe they have the power to revolutionise how we come together to cooperate around missions, problems and interests, as individual contributors, we have witnessed first-hand the friction that comes with joining and contributing to a DAO.
We see a number of important problems that need to be solved before DAOs can truly go mainstream:
1. New member onboarding and activation
Integrating new members into a DAO is not as straightforward as it sounds. Effective onboarding needs to be designed, executed and scaled with the community. Individuals need support finding their way, but prescriptive approaches conflict with the DAO ethos of autonomy. On top of that, onboarding is a massive lever for long term engagement and retention by preventing early churn.
For individuals joining a DAO, the process can be overwhelming and confusing, especially for those who are newer to Web3. We need scalable onboarding pathways that help individuals find their way into and within DAOs without getting lost or overwhelmed.
2. Managing member reputation, roles and permissions
New members onboard and offboard from DAOs with much greater frequency than traditional organizations. DAO participation is highly liquid. Managing the roles, permissions and reputation of members within a DAO and between DAOs is therefore an insurmountable challenge if it is to be done manually.
In the future we see DAO members having an on-chain record of their current role in the DAOs they are part of, which can unlock access permissions, influence voting power and act as an on-chain resume.
3. Member retention and engagement
Member retention and engagement are struggles for most DAOs. Staying involved and participating regularly are challenging for those who only have a few hours a week to spare. DAOs ‘live’ on Discord, where a 24h absence leads to a tsunami of missed conversation, and notifications are so overwhelming that servers are often muted entirely.
Some DAOs have already set-up internal newsletters that are manually curated with important information and updates from Discord, meetings and town halls, so members don’t need to ‘scroll up’ and follow the conversation that happened on Discord while they were away. Solutions based outside of Discord will be needed in order to make the experience of participating in a DAO more manageable and straightforward.
We are building Otterspace with the mission to help DAOs onboard their first hundred to their next million members by making the experience of joining and contributing to a DAO clear, straightforward, and familiar for the inhabitants of Web2.
By improving the experience of joining and participating in a DAO, we hope to make the space accessible and attractive to the next generation of contributors, and help DAOs unlock their full potential.
The DAO contributor experience is not just a tooling problem but requires thoughtful design that includes human touchpoints. We will bring to the table not only a modular and composable toolset, but also community-derived best practices that empower DAOs to make the most of our tools.
We believe in collaboration, crowdsourcing and building in public, and want to introduce our principles to keep us accountable to the community we serve. With that in mind, our principles will grow and evolve over time with input from the community, so stay tuned for ways you can contribute and participate.
We believe in the power of decentralization, but are also mindful of the present realities and constraints that will require trade-offs in the short-term. Our approach is to decentralize our own infrastructure and organization progressively over time.
Community is at the heart of everything we do, and even while we cannot yet call ourselves a DAO, we strive to build with and alongside the DAO community from day zero. We hope to make our own Discord community a place where DAOists can come together and share best practices and learnings as we build the DAO future together.
Positive sum mindset
We want to leave behind the Web2 mindset of building walls and locking users in. We believe in the power of collaboration, incentive-aligned networks and win-win outcomes.
We’re just at the beginning of our journey into otterspace, so join along for the ride and help us define the future of the otterverse.