Thinking around "Creating Streams for New Service Providers" - ENS Secretariat?

Hi there,

I work at a blockchain governance and policy firm called Doxed Capital. I’m also a collector of ENS names.

I have been reading the proposal about Creating Streams that is generating a lot of interest.

I think it’s easy to point to a number and say “these funds should be made available in a flexible funding pool and allocated to ENS community projects on an ongoing basis until / if the DAO says stop”.

What I haven’t seen anyone posting about yet, is the amount of staffing resources that would be necessary to effectively manage all of it. For example:

  • work with the ENS DAO to finalise the stream policy framework and how it will operate.
  • develop a reasonable and relevant criteria for stream applications
  • be on hand to answer queries and questions for applicants as they develop their applications
  • manage the applications process
  • provide secretariat and administrative support to the DAO
  • assist the DAO in the process of ranking the proposals if required
  • advise successful stream applicants
  • complete the admin associated with setting up each stream
  • seek regular reports from each stream to monitor progress
  • provide timely feedback to the DAO about the performance of each stream
  • if required, manage out underperforming streams in a legally sensible manner and consistent with the stream policy framework that each stream provider has signed up to
  • manage the renewal process (if applicable) for time-limited streams with fixed delivery outcomes

In order to manage the process effectively, the DAO could allocate around 20% of the total Stream program amount to admin, secretariat and management.

We see the tasks as follows if the stream vote passes:

  1. Meet with the DAO and discuss /develop an ENS streams policy framework
  2. Seek feedback on the ENS streams policy framework from the community
  3. Amend the streams framework based on feedback
  4. Appoint the people/human resources that will have the job of managing the streams process for the DAO
  5. Seek applications for stream funding
  6. Rest as per above

The streams concept represents a significant upscaling of the ENS ecosystem. A program, that could potentially support a lot of new ENS development that benefits all holders of ENS names. However, as with any organisation, growth needs to be supported and managed carefully to ensure that there is an alignment of expectations between the DAO, the community and the streams service providers and developers.

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I think this is a good point, and that there will be a certain amount of new admin work required to maintain this. I think this likely amounts to a part time job for one qualified individual, however, and 20% of 3.6 million - 720k! - is rather a large amount of administration overhead.

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I’d like to work to reduce bureaucracy and overhead if possible. I believe a lot of these tasks you mentioned are not as work intensive as predicted and they should be responsibility of stewards – which I think with the new rules on compensation being voted, would encourage some of them to dedicate more time to the DAO. My biggest fear here is that we’re stacking adminstrative layers on top of what should be a lean organization. Remember, the DAO exists to support ENS, and if that logic goes the other way (ENS main purpose being to support the DAO’s overgrowing bureacracy), then the whole thing is a failure.

Of course, if the stream model is sucessful, working groups budgets could also be incorporated in the same framework.

And if I’m wrong and managing the streams is a full time job (which I doubt), I’d be happy to reassess that in a year or so.

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Hi there Nick.eth, thanks for contributing. You raise a good point, here’s some more thinking around options.

  1. low engagement / no intervention (Warm Milk Version)

$3.6m is given out to stream teams by a part-time worker working 2.5 days a week (supporting the DAO) who doesn’t really have the time, budget or inclination to meet those teams and really get to know their aims, aspirations, tech and humanity. Following selection, the streams run autonomously and there is little or no reporting, collection of data or progress. We trust the process, throw the cards into the air and hope they land to make a castle. If one of the projects does the “wrong thing” they arbitrarily find their funding cut by the DAO without warning.
eg Budget:
1 part-time ENS DAO project officer 0.5 FTE 40-50K USD per year
goods and services budget 10K
on costs 5K
total budget 65K pa

  1. Medium engagement (Latte Coffee Version)

A project manager works with the DAO to develop a high-level framework about how the DAO would like to grow the ecosystem and what are the priority and strategic projects that could help to make this happen? The framework also has input from the community and is eventually published into a document. This ENS Growth Framework then helps to guide the development of selection criteria for the ENS DAO stream grants application program.

$3.6m is given out to projects by a full-time manager working 5 days a week (supporting the DAO) who has the time, budget and inclination to meet those teams and really get to know their aims, aspirations, tech and humanity. Following selection, the project manager is involved with the teams on an ongoing basis, identifying issues and preparing comprehensive reporting for the ENS DAO, freeing up the DAO’s time.

If a stream team starts to have issues, then the ENS project manager works with them to try and help/ understand / fix the issues whilst keeping the DAO informed, thereby avoiding a project cancellation that hurts developers.

If a stream team continues to have problems, they are given a 3 warnings process over time that is a fairer way of letting a team know that they are failing to meet their commitments and that progress is important.

eg Budget: 1 full-time ENS DAO project manager 1.0 FTE 90-110K USD per year
goods and services budget 20K - events/promotion/growth
on costs 5K
total budget 135K pa

  1. Fully engaged (Double Shot Version)

A project manager and 2 project officers are appointed to take care of the administration of all ENS DAO grant programs and funding. This includes ENS Streams Grants, small Grants and any other funding streams that the DAO makes to devs and the community. This team of ENS workers does all of the funding / grants leg work that is a normal part of running a $50M organistion. The team also contributes to the marketing and promotion of the ENS ecosystem in collaboration with an ENS DAO Marketing manager.

All of this additional help, frees the ENS DAO from project management and allows the leadership to spend more time working on high-level strategy that supports the growth of the ecosystem.
Thinking, that is hard to do when one is buried in project management.

eg Budget:
1 full-time ENS DAO Project Director 1.0 FTE 90-110K USD per year
1 full-time ENS DAO Marketing Manager 1.0 FTE 80-90K USD per year
2 x part-time ENS DAO Project Officer 1.0 FTE 60-80K USD per year
total staff budget 360K
goods and services budget 150K - events/promotion/growth
marketing budget - 150K
on costs 40K
total budget 700K pa

Hi AvsA, thanks for contributing.

Yes we are in tech, where lean models are highly valued and nobody wants bureaucracy.
But in the end, it’s simply a business question of how fast would you like to grow the ENS ecosystem?

If the answer is slower, organic growth, then having volunteer stewards administer and project-manage grants is consistent with that.

Conversely, if the answer is moderate growth, then volunteers are unlikely to be able to put in the required time in to be able to meet a moderate growth objective.

Alternately, if the answer is hyper-scaling, then there would need to be a significant business reinvestment of funds into the ecosystem to purchase the human, digital and capital inputs that are needed to make that all happen.

Thinking between these options should also be influenced by the question of how fast are all the other ecosystems growing? How much of their revenue are they re-investing?
eg https://x.rarible.com/

“The company relied on reinvesting most of its profits into the business. This strategy allowed Amazon to expand faster while minimizing its tax burden.”

Amazon's 3 Key Financial Ratios.

For your consideration.

The DAO vote on Service Provider Streams shows pretty much universal agreement for investing more into the growth of ENS. I haven’t seen anyone arguing against that. We’re in agreement here.

However, adding a new 700k budget just for abstract layers of management is a low ROI spend lacking in clear goals or plans.

The best ROI investments to achieve growth will come through builders with talent & vision. Ex: What the Service Provider Streams program funds.

If you have a specific vision for helping ENS grow then encourage you to prepare a proposal for the Service Provider Streams.

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The DAO will decide on who gets streams by a vote, not a ‘part time worker’.

You’re using a lot of emotive language here to try and set a tone. Why does the person working on this not have budget or inclination to get to know the service providers? How does knowing their “aspirations, tech and humanity” help when their job is to administer the program, not to decide who gets funding.

You’re trying to describe this in a way that implies that anything other than a full-time role (or more!) is in some way negligent, but not actually providing any evidence of the workload that’ll be required. I’m still unconvinced there’s a requirement for a full-time job here, much less three of them.

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Hey there!

If we speak from a business point of view and take Amazon as an ethos, then the ratio of 700k / 4.3m (16%) can really be justified (for Amazon this ratio is 6/62b, 8-12% depending on the year).

But what I think needs to be taken into account first is that 6b is only 2% of their core business income. ENS has not earned 50m/year for a long time. 700 thousand is 4-5% of ENS’s income from its core activities, which is colossal, considering that you propose to spend this money on maintaining the administrative apparatus.

Hi Nick
I apologise if some of my language seemed a little emotive.
I have re-reviewed my intentions in writing in the first place and it was really the following sentence that jolted me into action.

“Streams represent a great innovation in crypto: For Governance, they can be canceled at any time, so it’s a good way to stop a service provider who isn’t performing well. On the other hand, for the provider it’s a guaranteed income until the DAO changes their mind, meaning that inertia is in the provider’s side.”

I’m all about governance and structure. While I think the overall proposal has a lot of merit, the quote above just made me see red flags.

It can be a great thing to give visionary devs funds to bring their projects to life. But having to take those funds away for what ever reason can cause a lot of problems. The idea of cancelling a stream at any time, if the DAO changes it’s mind, while sounding convenient for the DAO, is in practice riddled with issues. For example “being cancelled at any time” could

  • greatly effect developer morale and performance due to lack to security
  • give rise to legal challenges for unfair dismissal against the DAO

The legal challenges could be avoided by developing a framework that informs

  • streams selection criteria
  • contracts for succesful applicants that specifies the ability for the DAO to cancel a project at short notice.

But that still doesn’t beat the feeling of doom at having no security of tenure that can eat away at morale and shift cost burden onto dev teams who have to sign leases (if applicable) and spend on fixed costs without knowing if they will be cut and have the money to pay for them.

I read the other discussion where you were talking about having more structure in place before the program starts and I agree with you.

This seems like FUD.

There are no guarantees in life. The DAO is set to provide material funding to sophisticated actors.

I don’t believe this much administrative overhead is a value add.

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@thesleepinggypsy.eth

If you think you can provide a great value add then make a proposal on why your secretariat would represent a significant improvement of the ENS system and put it to vote with the others.

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“Service Providers” have the responsibility to effectively communicate regular status updates to the DAO. This includes frequently and proactively asking the DAO to share any concerns / feedback on these status updates.

With a good faith approach it should be easy for “Service Providers” to identify if there’s a misalignment of expectations quite early and have sufficient time to resolve any meaningful concerns.

Any “Service Provider” with the proper experience should be quite familiar and comfortable with this approach already. I don’t see any qualified “Service Providers” being concerned with this detail in the proposed framework.

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