Colony— Telegram AMA — May 19
On Wednesday, May 19, we had the pleasure to welcome to our Telegram chat:
Jack du Rose, Founder, and CEO at Colony.
We asked him questions about the development of Colony.
Some sentences have been slightly edited for readability but the meaning has been conserved.
The Colony Network is a suite of smart contracts, running on Ethereum. It provides a general-purpose framework for the essential functions organizations require, such as ownership, structure, authority, and financial management.
Colonies exist to enable collaboration between their members, and direct collective efforts towards common goals. Facilitating effective division of labour, management of incentives, and allocation of resources are therefore some of the most important functions of the Colony protocol.
The Colony token, CLNY, is designed to capture value from the success of every DAO ever built on the Colony Network. It does this by taking a small % fee from every payment that leaves a colony to an external address.
Q — Ayeley from GAINS: Let’s start with a little background of yourself. What did you do before crypto and did you have any other previous venture in crypto?
A — Jack from Colony: I’m Jack du Rose, and I’m founder and CEO at Colony.
Before crypto, I was a jeweler. I made extremely high-end fine jewelry which made novel use of CAD and 3D printing to make jeweled art that couldn’t be created using traditional techniques. Check it out here.
Aside from my own designs, the thing I’m most known for in the jewelry/art world is designing Damien Hirst’s $100m diamond-encrusted skull.
In addition to Colony, in 2016 I also co-founded what is to my knowledge the first real NFT project with @sillytuna and the founder of Neopets, Adam Powell.
Q — Ayeley from GAINS: It would be cool to know how the switch from making jewels to crypto happened
A — Jack from Colony: It was called “Ownage” and was focused on in-game items. However, while we anticipated all the right things, we made an ill-fated merger with another gaming company in 2018 and that company, unfortunately, didn’t make it, taking Ownage with it.
I wanted to get out of jewelry as I liked making cool stuff, but not selling it. I’m a nerd, and not really suited to having fancy lunches with billionaire heiresses. One day, one of them asked me if I could help her with a company that would be similar to my own: a distributed team of elite craftsmen. I really didn’t want to do it, so I tried to come up with a way I could still take her on as a client but not have to do the work of managing it myself.
And that was where the idea for Colony started. While at the same time I was already getting quite heavily into bitcoin.
Q — Ayeley from GAINS: For those hearing about it for the first time, what is Colony about in a few simple sentences?
A — Jack from Colony: Colony is the biggest, baddest DAO framework out there. And It’s easy! You can Spin up a DAO in three minutes, for half a penny. Issue a token, raise money, govern your treasury, and so much more. Zero coding required.
Already got a token? Great. Colony will give it superpowers in seconds.
Colony’s about getting things done, and voting on every little thing ain’t that, so in Colony, votes are only necessary if there’s disagreement. You can check it out in action here.
Q — Ayeley from GAINS: For how long have you been working on Colony? And how many people are on the team?
A — Jack from Colony: I discovered Bitcoin in 2012 and got really into it in 2013, while I was coming up with the idea for Colony. I then read Vitalik Buterin’s Ethereum white paper in Dec 2013 and I knew that it was the fundamental underlying technology I needed to build Colony.
My co-founder and I built the first prototype of something we called Colony in 2015 and presented it at Ethereum Devcon 1 in London. Since then we’ve been quietly iterating on the product with different technologies and approaches, and now we’re a team of 12 and we know we’ve got the ultimate DAO framework. It makes all the others look like kids’ toys.
Q — Telegram user Abisola: What role do Manager, Worker, and Evaluator play on Colony platform?
A — Jack from Colony: That’s a construct that exists within “Tasks” in Colony.
Tasks allow there to be someone who creates and is the project manager of a Task. It’s their job to make sure the task is properly defined, help the worker with all the specs they need, and ensure the work gets delivered.
The worker, obviously, is the person who does the work.
And the evaluator is the person who QAs the work. Like a code review for developers before a pull request is merged. All of these roles have a defined person responsible for them, and all these roles are compensated. That’s important because it makes it much easier for teams to coordinate effectively when people clearly understand what they need to do.
Q — Twitter user @meml1997: It really caught my attention that Colony has a “Lazy Consensus” mechanism. Can you tell us more about it and how does it work? Why is it “Lazy”?
A — Jack from Colony: DAO consensus formation usually happens off-chain, & voting on-chain is really just to ratify a decision that’s already been made. Voter cat herding is a waste of time and energy. Lazy consensus means unless someone “objects” and forces a vote, motions pass automatically.
Q — Twitter user @anaAnamacf: Could you tell us about the administration of the domains of the colonies. How would this protocol work so as not to lose potential information about the fulfillment of functions, files, etc? With so much backlog of tasks, it is somewhat difficult to maintain proper organization.
A — Jack from Colony: Actually, that’s exactly the purpose of domains. You can think of them as like departments and teams in a company. It can also be useful to think of domains, and the domain hierarchy as like a file system on your computer.
Right now, other DAOs out there like Aragon & Moloch are similar to making you only have a single folder on your computer.
Everything you want to do needs to go into that single folder, and then you have the pain that everyone who wants to use that computer (because remember a DAO is something people share) now have to deal with that one big massive, messy folder.
Q — Telegram user Kaulxp: Why did Colony choose xDAI? Is it possible there are plans to expand to other Etherum or Smart in the future Chain future for example?
A — Jack from Colony: We chose xDai because it was technically very easy, and we found that some other great projects with founders I respect were going there. Polygon we didn’t really like because it required code changes, and we thought their code didn’t look great, and there is a long wait if you want to exit the chain because it’s based on Plasma. Binance Smart chain wasn’t around when we made that choice, but we wouldn’t have gone there because it’s centralized to the benefit of Binance exchange, which is exactly the kind of reason most of us early crypto people got into crypto.
We don’t see xDai as the final destination for Colony, which is more likely to be on a rollup, or perhaps Polkadot or Dfinity, but it’s more than good enough for now.
Q — Telegram user kunlefighter: I observed that at the level of the core Colony contracts, access is mediated by permissions and not reputation. Why did you decide to make permissions’ Colony’s core access-control logic? What are some of the benefits it offers you?
A — Jack from Colony: Excellent question. Permissions are the lowest level of control in the colony network. We expect these permissions in most cases to be given to extension contracts which mediate the relationship between the user and the underlying permission system via reputation.
However, we also think that organizations will need people to be able to act unilaterally in many cases.
So you can imagine an org with many layers. At the top of the org, it’s totally reputation controlled, but at the edges of the org it can be controlled by permissions, because the people controlling those permissions only have access to small pots of funds, and those pots were funded by people using reputation knowing that those teams on the edges need to be able to move fast, not get stuck in voting processes.
Q — Ayeley from GAINS: What is the token use case and how does it capture the value of the ecosystem you’re building?
A — Jack from Colony: The Colony token, $CLNY, is designed to capture value from the success of every DAO ever built on the Colony Network. It does this by taking a small % fee from every payment that leaves a colony to an external address, e.g. if you’re working for a colony, and getting paid for completing a bounty, a small % of that payment will go to the Metacolony; the colony that manages the Colony Network.
Token holders can use the token in 4 main ways:
1. *Staking:* Reputation is earned by doing work, but decays over time. Network-wide Reputation updates are calculated off-chain by ‘Reputation Miners’ who stake CLNY and can thereby earn CLNY and Reputation.
2. Governance: Some activities in the Metacolony require CLNY to be staked as a surety against misbehavior. Successfully performing the activity earns the staker CLNY and Reputation.
3. Revenue Sharing: The Metacolony governs a whitelist of tokens (initially ETH, DAI, USDT, & USDC) which are considered revenue of the Metacolony, and may in part be distributed as Rewards proportional to combined Reputation & CLNY holdings.
4. Burning: Network fees received in tokens that are not on the whitelist are auctioned in exchange for CLNY, which is burned. Network fees are taken in CLNY (such as payments from the Metacolony) are burned directly.
Q — Ayeley from GAINS: Have you raised funds so far? If so, how did you handle them? And are you planning to do any future raises?
A — Jack from Colony: I funded the project myself at the start, and then we started taking in external funding in 2016.
Since then we’ve gradually raised a few million from individual investors in the space who have approached us. This hasn’t been an “insider” thing — anybody could have found us over these years, and many did. We’ve been very consciously grassroots funded.
This year, we were also persuaded by institutional investors and raised a strategic VC round, which ended up over 350% oversubscribed.
It was pretty crazy getting harrassed by VCs to give them allocation. 😅
We’ve issued all early investors with SAFTs that will allow them to unlock their tokens gradually over 2 years after Colony’s public token sale which will happen in the coming weeks.
We’re just waiting on regulatory registration with the financial regulator, and then we’ll be good to go.
The sale will use our own token sale mechanism, which is part of Colony.
Unlike launchpads and complicated bonding curve systems, it’s dead easy to use and totally free.
You can spin up a colony and issue your token via a coin machine without ever touching a single line of code.
Q — Telegram user Moonlight©: If you are confident with grassroots funding, why still need institutional investors?
A — Jack from Colony: Because I believe that it’s important to develop a heterogeneous stakeholder set, especially as we look to establish Colony as the de facto DAO framework among blue-chip Defi projects. With great VC investors supporting Colony, we have easy access to many of the best projects in the world.
Q — Ayeley from GAINS: What stage is the project at? And what should we look forward to in the coming months?
A — Jack from Colony: We published the Colony white paper in 2017, and all the smart contract functionality we described in it is now complete.
We are one of the few projects ever to have built their product before doing an ICO.
For us, this was very important ethically, as we knew what we were building is hard and we didn’t want to expose unsophisticated investors to the risk of our failure to deliver on our vision.
However, now we have delivered it, we feel comfortable issuing the token. The main work we have to do now is building out UI components to make the power of the underlying smart contracts accessible to end-users. You can check out our 2021 roadmap here.
Q — Twitter user @Lidiamga: I read on your vision that Colony’s long-term ambition is to catalyze a “Cambrian Explosion” of previously organizational forms. I’m very curious about the meaning of this ambition. Can you explain what it means and how are you planning to achieve it?
A — Jack from Colony: So for those who don’t know, the Cambrian Explosion was when life burst into the world during the Cambrian era. Before then there were really just a few very simple organisms, but during the Cambrian Explosion, evolution really kicked off and a huge diversity of lifeforms started to proliferate on earth.
There are companies, coops, charities, etc, but because it’s so complicated and so bureaucratic, it’s pretty difficult to imagine how you’d create new kinds of organizations, or what that even means.
Especially when it comes to getting funding, because when people plan to put money into something, they need to understand it, and people need to feel comfortable about the structure and nature of the organization.
But really all an organization is, is a bunch of people who are doing something together.
Blockchain technology has already birthed new kinds of organizations: the first was the bitcoin network.
A piece of software that incentivizes people to supply it with computing power.
And at the base, Colony is really just a generalization of that principle. In Colony, instead of being restricted to incentivizing the provision of computing power, people (and bots, and machines, and anything that controls a private key) can be incentivized to do whatever that organization needs doing.
So that could be things like playing a game or using an app, and it’s just in these games and apps, the value that you create for the app by its use (just like in all social media, and especially things like TikTok), you earn some ownership of the value that app generates, which is distributable among the users proportional to the value they’ve added.
Q — Telegram user Robert: How has and will Colony adapt to new market trends? Currently, the trend is NFTs. Have you integrated Nfts into Colony?
A — Jack from Colony: Not yet, even though I was one of the first people in the world to be working on NFTs, we’re lagging in Colony in their integration. However, that is something we’ll be working on this year. You’ll be able to create, issue, receive, and control NFTs via your Colony DAO.
Jack, it was a pleasure having you in our group today, and taking the time to answer all our questions. Anything else you’d like to say? Where can we follow you to stay updated? — Ayeley Commodore-Mensah from GAINS Associates
Thank you all for your attention, and your questions. It’s been really fun.