The Definitive Guide to DAO Tooling

Decentralized Autonomous Organizations, or DAOs, are a new way of structuring projects and businesses. Unlike traditional organizations, DAOs are open-source, decentralized, and governed by transparent rules decided on by the community. This allows for increased accountability, as well as a wider pool of talent to work on a project.

Though DAOs have many benefits that make them appealing to Web3 projects, they can be tough to manage effectively as a project grows. When building a DAO, operators can run into several issues:

• Lack of organization due to poor infrastructure and tools
• Decrease in efficiency and coordination
• Lack of leadership due to less hierarchy
• Lack of accountability
• Inefficient voting processes
• Scalability
• Effective treasury management
• Difficulty attracting a community

These issues are usually the downstream effects of the tools a DAO uses in its daily operations.

During a Gold Rush, Sell Shovels?

In the last year, the number of DAOs has surged from 700 DAOs to an estimated 6,000 DAOs. And this growth is expected to continue as more crypto projects enter the market. However, there’s a major downside to all this popularity: the tools available are slow to keep up with demand. This makes it harder for members to easily manage their DAOs…and that’s a problem.

Fortunately, we’re not the only ones who noticed this issue. Companies have started popping up to build management tools, governance tools, onboarding tools, and more. Including us!

Let’s dive into how you can optimally run your DAO using existing infrastructure.

Onboarding and Contribution

Onboarding new DAO contributors and tracking their progress can be a hassle. In contrast to typical business structures, there usually aren’t managers within a DAO to hire new members, hold existing contributors accountable, or reward them for exceeding expectations. Fortunately, there are multiple tools to help with this:

• Coordinape: Allows DAOs to distribute resources fairly to contributors. Community grants, internal salaries, and special projects can all be incentivized and rewarded by the community.
• Dework: A crypto-native bounty board where DAOs can easily set tasks and compensate any contributor or team of contributors after completion.
• Station: Toolkits for DAOs and Web3 communities to activate their members to participate and contribute.
• Layer3: A platform that enables users to contribute to Web3 and earn in ownership.
• RabbitHole: A platform for learning how to use and contribute to decentralized apps, earning tokens based on the on-chain activity.

Creating Documentation

Before your DAO is up and running, it’s essential to have a documentation hub. All components (technical and non-technical) should be documented transparently and in their simplest forms. This hub will act as a source of truth and ensure that anyone can quickly learn the ins and outs of your project.

Below are some popular options:

Gitbook is perfect for those who want an easy set-up and consistent look across their documentation. Once it’s set up, adding new content is as simple as writing a Markdown file and pushing it to your Git repository. The downside of Gitbook is that it can be difficult to customize the appearance of your documentation. If you’re looking for complete control over the style of your documentation, Gitbook might not be the right tool for you.

Notion is great for people who want a flexible documentation tool that they can use for more than just documentation. Notion can be used for everything from project management to task tracking to creating a personal knowledge base. The downside of using Notion is that it can be difficult to find the right template or setup that works for you. Also, it can be easy to get overwhelmed by all of the different features and options provided by Notion’s flexibility.

Docusaurus is a documentation tool that’s easy to use and customizable. It has all of the features you need to create clear, concise docs. Setting up a Docusaurus site is quick and easy, and there are plenty of themes and templates to choose from. However, one downside of Docusaurus is that it doesn’t have as many features as the others featured on this list.

Choosing a Governance Forum

A key similarity between all successful DAOs is hosting a forum to discuss proposals before voting. Matters such as risk assessments, protocol changes, expenses, and treasury strategies should be discussed here at length.

There are many different types of forums out there, each with their strengths and weaknesses. Here, we’ll take a look at three of the most popular governance forums: Commonwealth, Discourse, and Flarum.

Commonwealth is an open-source forum that is known for its flexibility and ease of use. It features a clean interface and a wide range of plugins to extend its functionality. However, it lacks some of the more advanced features of other forums, such as email notifications and private messaging.

Discourse is another popular open-source forum. It’s known for its focus on discussion and collaboration, with features such as threaded conversations and inline comments. Though, it can be difficult to use for beginners and lacks some of the more basic features found in other forums.

Flarum is a relatively new forum that combines the best of both Commonwealth and Discourse. It has a clean interface like Commonwealth but also includes advanced features like Discourse. It also has a unique “reputation” system that encourages users to participate in discussions.

Governance Voting

A DAO’s governance framework can make or break the success of the organization. In most cases, a DAO must have some, if not all, decisions passed through governance via proposals as highlighted above. These decisions can include protocol updates, deployment of treasury assets, budgets for team members or working groups, finalizing partnerships, and more. Having an efficient and safe decision-making process is crucial for any successful organization — especially a DAO.

Here are a few tools that allow DAOs to do exactly this:

• Tally: A low/no code tool that enables the ability to create proposals, delegate, and vote in DAOs.
• Snapshot: A decentralized and user-friendly voting system. Creating proposals and voting does not cost gas as the process is performed off-chain.
• Metropolis (prev. Orca Protocol): An on-chain permissions layer for DAO working groups. Their permissions layer is a wrapper around a Safe, which creates a governance primitive they call pods.
• OpenZeppelin Governor: A modular suite of contracts for managing on-chain governance.
• Messari Governor: A governance aggregator that curates and compiles proposals from the discussion phase to implementation. It also contains a list of the current DAOs and DAO tools available.

Financial Operations

Lastly, financial operations can be quite dreadful for DAOs. Without the proper tools, executing treasury management and payrolls is slow and complicated (via multi-sig), and accounting is done retrospectively by tracking movements on-chain. To put it mildly, this isn’t ideal. Sticking with the theme of this blog post, here’s some tools to consider:

Parcel

• Utilizes Safe’s multi-sig wallet
• Dashboard tracking contributors, total assets, recent transactions, and more
• Allows for automated payrolls and mass payouts
• Allows for delegate access and nested Safes
• Integrated with Coordinape
• Total payouts: > $150m
• Used by Index Coop, BanklessDAO, OlympusDAO, ENS, dYdX, and Compound Grants
• Available on Ethereum

Utopia

• Utilizes Safe’s multi-sig wallet
• Dashboard tracking contributors, total assets, recent transactions, and more
• Allows for automated payrolls and mass payouts
• Offers a suite of compliance features
• Total payouts: > $100m
• Used by Sushi, Balancer, FWB, PleasrDAO, YGG, and more
• Available on Ethereum, Polygon, Arbitrum, Avalanche, Optimism, BNB, and Gnosis Chain

CoinShift

• Utilizes Safe’s multi-sig wallet
• Dashboard tracking contributors, total assets, recent transactions, and more
• Allows for automated payrolls and mass payouts
• Allows for spending limits by adding a beneficiary address
• Soon will integrate asset allocation, risk assessment, and insurance
• Used by Uniswap Grants, Biconomy, Perpetual Protocol, PrimeDAO
• Available on Ethereum and Polygon

Motherboard: The All-In-One Platform

Although there are plenty of DAO tools available, they each focus on specific categories of operations. Oftentimes, this leads to DAO operators needing to use multiple tools hosted in a variety of applications — which can be overwhelming and inefficient.

Wouldn’t it be better if they were aggregated into one platform?

This is exactly what we’re building with Motherboard. Everything you need to run a DAO in one place. Not a tool, a platform.

Financial Operations

• Spot and recurring payments for contributors
• External payment requests for non-contributors
• Labeling system for all outgoing transactions
• Native Gnosis multi-sig payments
• Aggregated DAO multi-sigs cross EVM chains with notifications for signers
• Label-based automated accounting
• Treasury liquidity and runway analysis
• DAO-to-DAO comparison of analytics and payroll spend

Coming soon:

• Natively integrated, automated risk tranche vaults available for all Motherboard DAOs via Sector Finance integration
• Automatically compounded cross chain strategies curated by an in-house risk engine
• Native one-click strategies available for a wide risk appetite
• Contract interactions with Safe apps

Onboarding and Contributor Management

• Invite links and direct applications for efficient and centralized onboarding
• A role system to manage the onboarded contributors and their access to certain features within the platform

Coming soon:

• Integration of Coordinape for decentralized compensation

Governance

• Native integration of Snapshot with notifications for proposal outcomes
• Full view of past, present and planned proposals

Communication (Coming Soon)

• Internal encrypted communication chat for secure team coordination
• External encrypted channels for business development
• Token curated registry of DAOs ensuring legitimacy
• DAO admin curated list of relevant team members automatically added to each shared channel
• Discord integration for communication with the DAOs community

What next?

If you’re like most people, the world of DAO tooling can seem confusing, and frankly, underwhelming. That’s why we wrote this blog post. That’s also why we built Motherboard.

We want to provide a one-stop shop for all your DAO tooling needs. Whether you’re looking for a way to manage your finances or governance, we’ve got you covered. Check us out and see how we can help you streamline your DAO operations. Get started here.