You're reading State of the DAOs, the high-signal low-noise newsletter for understanding DAOs.
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Compensation is one of the most challenging design challenges within DAOs. Getting paid in governance tokens offers unique ownership and equity incentives, but often falls short of providing a living wage to contributors.
This week, Jake and Stake tries to solve the compensation puzzle by laying out variable compensation strategies that reward outcomes, recognize people for their work, and give them a stake in building something that matters. When DAO contributors start to think like owners, DAOs win.
Next, we have an interview with the Impact DAOs Research + Book project featuring Alona Schevchenko, the founder of Ukraine DAO. Seneca52 shares the story of how DAOs enable people to respond to crisis much quicker than traditional charities, empower communities around a cause, and how crypto and the tools of Web3 help Impact DAOs fulfill their mission.
Finally, we share the TL;DR on the latest DAO ecosystem takes and thought pieces, making it easy for you to cut through the noise and stay up to date on the world of DAOs.
This is the current state of the DAOs.
Contributors: Jake and Stake, Seneca52, Alvo von A, Austin Foss, Ashpreet, oxdog.eth, Suyash, makkiyzy, hirokennelly, siddhearta, Dippudo
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Author: Jake and Stake
Image credit: Dippudo
In many professions, particularly sales, variable compensation (or performance-related pay) is used as a way to align employee incentives with business incentives, leading to positive outcomes for both parties. When the business makes more money, the contributor makes more money.