Different types of DAOs
DAOs 101
Greg Isenberg, the CEO of Late Checkout (a US-based agency, fund and product studio that designs, creates and acquires community-based products and web3 communities) is so right saying:
“Community is the most precious coin of the new Internet era. You may come for the DAO, but you will stay for the community.”
A DAO (Decentralized Autonomous Organization) is a digital-native organization that sets a purposeful and community-powered mission for itself, and operates thanks to blockchain smart contracts, in order to secure transparency, governance rules and fair value-sharing, without requiring any central control. As an autonomous organization, a DAO has no owner, no shareholders, no Board, no CEO nor Executive Committee; it is ruled by the propositions and votes of the DAO members. It is no less than a disruptive paradigm shift in managing an organization and opening up a community.
Most DAOs are legally created as Foundations, which are autonomous entities with objectives and processes defined by their Articles of Association. Foundation members can financially contribute to the development of the Foundation projects, and can vote on strategic / governance / community propositions. Execution then is usually entrusted to a supervising team, also chosen by members to work for their common good.
DAOs are thus powerful and diverse by essence. Nowadays, it seems that about everything can be organized as a DAO in full transparency and efficiency. Hereafter are some of the use cases and functionalities offered by DAOs, and which can possibly be cumulated.
Protocol DAOs
The typical examples of Protocol DAOs are DEx (Decentralized crypto Exchange) like Uniswap or Pancake Swap, which rely on an AMM (Automated Market Maker), a computer program automating the process of providing liquidity for digital assets. This was introduced to remove any intermediary (or market maker) in the trading of crypto-assets, as they exist on CEx (Centralized Exchange). AMMs leverage liquidity pools financed by users / token holders that are rewarded back in tokens for the money they bring to the liquidity pool. Similarly, decentralized lending protocols, such as Aave, emerged to let users lend / borrow cryptocurrency with a liquidity pool, without going to a centralized intermediary.
Community members are interestingly incentivized to regularly check the projects on the platform and promote the ones that — according to each — most deserve to be financed.
Investment / Venture DAOs
Investment DAOs represent a transparent and inclusive means to invest. Community members pool their money in order to collectively invest in various projects, and mostly in Web3 ones. In general, private equity / venture capital funds are reserved to qualified investors (becoming Limited Partners). Investment DAOs lower the barrier to entry to innovative projects, allowing most people to access their potential future profitability. Popular current Investment DAOs are BitDAO, Syndicate, Krause House DAO.
Grant DAOs
Grant DAOs are similar to Investment DAOs, as members pool their investments to support specific objectives. But conversely, Grant DAOs members do not expect any financial return. Their ambition is to reinvent the way people donate. As examples, Dream DAO creates NFTs to raise funds, Aave Grant DAO helps financing fundamental IT tools to improve DAOs management.
Transparency and funds tracking are seen as game-changers versus the abuses from their Web2 equivalents.
Non-profit DAOs
Non-profit DAOs leverage the social responsibility and goodwill of all members and stakeholders, in order to boost the ESG impact in the brand-new Web3 world. The growing adoption of crypto-currencies and their easy international transfers allow Non-profit DAOs to create an important and prompt impact. Big Green DAO for instance is trying to reinvent philanthropy.
Collector DAOs
Collector DAOs are a mix between Investment DAOs and Non-profit DAOs. They aim at collecting funds in order to invest and share the property of famous NFTs or collection pieces. Most famous examples are FlamingoDAO that collects premium digital art (CryptoPunk NFT #2890 was purchased last year for 760 000 US$), or ConstitutionDAO that raised 47 million US$ in a week time to try to purchase one of the first copies of the US Constitution.
Creators / Social DAOs
Creators DAOs change the way social communities interact, create content and can live from this. Artists, creators, influencers are rewarded for their creations in tokens, rather than being bound to get financed — as so typically of Web2 platforms — by advertising or through a paywall. For example, Friends With Benefits community has dedicated access to exclusive events and artists’ work.
Medias DAOs
When Web2 medias are controlled by happy fews and influenced by their backers (whether advertisers or investors), Medias DAOs build and promote community-generated content, and reward back their contributors accordingly. For example, Bankless DAO gathered in order to promote education and awareness around decentralized banking ecosystems such as Ethereum, Bitcoin, DeFi.
Service DAOs
Service DAOs are not necessarily backed by a token with its value increase as a goal. Their objective is to help startups and companies grow and find talents. They are the recruiters or headhunters of the Web3, giving access to a decentralized talent pool.
Sub-DAOs
Sub-DAOs is a subgroup of a DAO working on a specific goal to support the project and community. They can be the equivalent of the digital marketing agencies of the Web2. A famous recent example is Balancer Protocol, which created a sub-DAO to ease decision making and facilitate execution, without requiring the whole DAO community to vote on each proposition.
Founders DAO — Our Mission
We, the initiators of the Founders DAO ecosystem, indeed believe that the current and future leapfrogs of the Web3, as well as its hype, need some pragmatic, open and inspiring steps forward to reach its game-changing potential.
We also trust that enabling anyone to launch, structure and / or finance a DAO with its community is key to scale Web3 technologies and principles.
We commit ourselves to:
- Develop a global, inclusive and diverse citizens ecosystem of founders and builders of Web3 for impact;
- Build the financial, operational and governance infrastructures enabling the emergence of leading decentralized platforms in 2030;
- Guarantee the long-term alignment of stakeholders and sharing of value mainly benefiting their user community.
Let’s build the Web3 together!
For a greater decentralization of our economies, for a broader contribution from and back to our communities, for a positive ESG impact (Environmental, Social, Governance) on our societies and our Planet.
🌐Website: https://www.foundersdao.io
🐦Twitter: https://twitter.com/FoundersDAO_
👨🏫LinkedIn: https://www.linkedin.com/company/foundersdao/
💬Discord: Coming Soon!
