Proposal to form Resourcing and Compensation Committee (RCC)

We are asking the community (we need a name for Lido holders still) to discuss and vote on a resourcing and compensation committee (RCC) to streamline the hiring, onboarding, remuneration and payout process for DAO contributors below the senior-most level. Team leads or department heads for example would still be subject to the proposal-based hiring process governed by the DAO.

Lido is a DAO. DAOs are by definition supposed to be decentralized. It is paramount that the community behind a DAO drive key decision-making. However, as a DAO grows and becomes complex, there will be an increased need to delegate minor or highly specialized tasks to reduce operational burden. This way, we hope to reduce voter fatigue on matters they might lack the time, interest or technical expertise to carefully consider.

All DAOs face the challenge of striking a balance between direct community involvement and delegating responsibilities. Our proposal takes a lot of the learnings from Maker’s governance process and how they operate their core units.

Thanks in advance for reading and commenting on the RCC proposal.

Summary

Create a governance committee dedicated to managing, executing, tracking, and reporting on hiring and contributor-related operating expenses for full time DAO members.

Allow the committee autonomy to deploy a bi-yearly allocated resourcing budget as they see fit with quarterly reporting on the decision-making process and allowing for community feedback. Budgets will be proposed on an annual basis and may be revised during the year. Funding for each “budget period” (6 months) will be disbursed from the Lido treasury to the RCC wallet twice a year, via DAO vote.

Eventually, once Lido’s departments grow large enough it will be necessary for each department to take on this work independently, but for now, there are both efficiencies and privacy-related motivations to conduct all of this work through one committee.

Budgeting details will be in a separate proposal to not distract from the operational considerations of the RCC.

Motivation

The current onboarding process for new DAO members is burdensome and comes with privacy concerns to a lot of individuals. While there are tools to reward contributors such as Coordinape, these lack additional features to fit Lido’s needs in the short term.

The current process myself and Izzy went through is not for everyone. There is also a tremendous overhead to get gas costs or simple reimbursements handled by team members and is the reason for this proposal. The goal is to establish a budget paid out twice a year to the committee for managing payroll, work related expenses, reimbursements, and travel.

As the teams grow, we will plan to split each team out into its own committee to be managed by the team leads with oversight from other team leads, the DAO, and neutral community members.

Proposal

I propose a founding committee of current team leads as well as an open call to community or DAO members to provide additional oversight. If you are interested please reach out here or through other channels.

Governance

The RCC should be considered part of the Financial Operations Team along with the reWARDS and LEGO committees. The Financial Team will be proposed at a future date.

After comparing a number of service providers, Utopia Labs was selected for our specific needs right now. It allows for payments to our contributors with minimal private data being exposed on-chain, invoicing, but also audibility of payments through on-chain tracking and is built on top of Gnosis Safe for durability. Changing providers or adding new providers is considered within the committee’s operating mandate and will be disclosed in committee updates.

Parcel Utopia Labs CoinShift
Multi-account management and overview In next version In next version In next version
Transaction Labelling Yes Yes Yes
Team management and app roles Yes Yes Yes, advanced
Reduced / Free gas fees (mainnet) Yes Yes No
TX Batching Yes Yes Yes
Transaction Approval In app or via Gnosis Safe Gnosis Safe or in-app (next version) In app or via Gnosis safe
CSV upload Yes No Yes
Treasury / asset management functionality Yes No Yes
Attach files Basic Intermediate Basic
Data export Yes Yes Yes, advanced
Polygon support TBD No Yes
Analytics / Reporting Intermediate Basic Intermediate
Support for streaming payments and vesting contracts In next version Within 2022 In next version

Change Management

I propose an initial committee member review within the first 6 months pending proposal approval to discuss change management and/or areas for improvement.

Oversight

Details:

  • RCC Multisig - to be added once final members are agreed upon
  • Designated Contact: TG - @jbeezy1
  • Quorum - 3/5 to start, transition to a higher threshold with community oversight

Proposed initial signers

  • Jbeezy from Lido, Business Development Lead
    • address: 0x039bDD285d3eDb1D9B6001d3097067Aa2AF7d826
  • Izzy from Lido, Master of Validators
    • address: 0x783EA934d543CD1ccfd920639A7539a0BD3895e2
  • Kadmil from Lido, Technical manager for the DAO
    • address: 0x9A3f38AF97b791C85c043D46a64f56f87E0283D4
  • Aurelius from Lido, Operational Manger
    • address: 0x7A29c1197962D1b42FcfA8095fA1dF66E489fCd6
  • AD from Lido, Marketing Lead (to be formally proposed for a vote next week)
    • address: 0x0d22e69ce47818c3524Fe952e8De7AF78cC3C43b
  • Open call for 2 community members to provide additional oversight
9 Likes

Super glad to get this out proposal the door and to the community for comments and suggestions. This is a crucial piece of DAOgineering that will help us move at the speed and efficacy that we need to.

3 Likes

Made a few edits to update the initial Keysigners and increase initial threshold from 2/3 to 3/5.

New addtions were:

  • AD
  • Aurelius
4 Likes

Snapshot vote is now live and will run through 16 March.

https://snapshot.org/#/lido-snapshot.eth/proposal/0x008ce8f95382c70216820a39d717c6b494348aa474917b6351819af527bc2a54

1 Like

The implementation of the RCC multisignature wallet will help eliminate pressing issues and blockers that Lido contributors have been contending with for many months now. I urge the community to vote in favor of the RCC’s formation, so that Lido contributors can proceed in executing and hitting 2022’s OKRs.

2 Likes

What’s the first 6 months budget? Or that number is to be defined after committee setup?

To be proposed separately. This is a proposal for the general mechanism and the identification of the committee members and their roles & responsibilities.

2 Likes

This is simply a good form of optimistic governance that has two main benefits. First and most obvious, consolidate and operationalize processes that are a poor fit for forum/vote governance. Second, the DAO will be able to leverage its people better and minimize exposing many strategic plans.

I’d caution against doing this too quickly but the intuition makes sense. Overshooting or racing here can fracture the process across departments into a web of bureaucracy.

Lastly, I’d be happy to provide additional oversight as a signer if that would help.

4 Likes

Appreciate the offer. Once we get the ops process stood up I will definitely reach out to discuss details a bit more.

2 Likes

Kudos! This is a great governance practice that promotes accountability without totally sacrificing scalability. Organizations often overlook the retentive power of having a well-designed compensation governance process.

How are potential disagreements between community oversight members and protocol leaders handled?

Quarterly reporting is a great idea as transparency will be critical long-term.

We look forward to seeing this process in action! https://www.c3group.xyz/

1 Like

I’d love to see you in that role personally!

3 Likes

For transparency, the snapshot vote to form the proposal has passed!

A second proposal will be coming in the next few days around budget considerations.

2 Likes

can u guys clarify if the DAO is paid in LDO tokens or eth raised from VCs etc … like what is all the $ that was raised from VC used for? is it all converted to eth - stETH pair and staked? if not, why not allocate from the $ raised instead of diluting LDO more …

To mitigate the risk of running away with funds or other bad outcomes that is why the funding is broken down into smaller chunks. Eventually we would move to a quarterly system to limit the downside further.

The only time I can see disagreements would be a protocol leader attempting to send unverified expenses to themselves or a teammate. There will be processes in place in order to make sure expenses have a paper trail attached to them in order to validate the spend (receipts uploaded). There are also both team and individual limits on category spend each quarter. If any of these are to be under budgeted it will require a discussion or additional approvals from the DAO.

3 Likes

The diversification last year is what converted a portion of the treasury LDO into ETH as a backstop for the protocol.

1 Like