by 0xd11a019a70986bd607cbc1c1f9ae221c78581f49 (Yemel)
A process for the DAO to agree and allocate resources to strategic projects, make a public call for bids, and later decide on the best provider for the job.
This is not a replacement for the Grant Program, but instead a process to incubate and generate competing grant requests for a previously defined project.
The Tendering process should be implemented as a new proposal flow, similar to the governance process. It starts with a basic community signaling about the project, and later formalizes the requirements in a Tender Proposal. Once approved, bids for the project will be received over a period of time and the winner is decided by a community vote.
An important goal is to enable any member of the community to propose a project without the requirement of being the main executor of it.
The process starts with building consensus around the end goal of the project by using a customer-centric approach. The initial Pitch Proposal should address questions about the target customer, and the problem it solves, and any doubts about how it should work. Here, the audience of the proposal is the customer that will use the product.
The second step is to escalate the project idea into a Tender Proposal, including any project requirements, stakeholders, and details about the public tender. The co-authors of the proposal should include representatives of the stakeholder groups signaling their support. Here, the audience of the proposal is a company or freelancer that might submit a bid to build the project.
The process aims to generate more business opportunities for studios and freelancers looking to work for the DAO. Many talented teams are eager to work but lack the context of what needs to be done.
Finally, this process allows the DAO to allocate its budget in a transparent and efficient manner, by allowing the community to compare offers and vote for the most suitable one.
A new flow of proposal categories should be added to the Governance dApp.
1. Pitch Proposal
- Any member of the community can send a pitch proposal to test community sentiment.
- The proposal should include a product’s name, intended customer, the problem the product solves, benefits to the customer, a call to action telling the customer how to take advantage of the product right away, a FAQ answering the business or tactical questions about building the product.
- Duration 10 days and 2M VP threshold.
- Minimum required VP to submit a pitch proposal: 100 VP.
2. Tender Proposal
- Passed Pitch Proposals can be promoted to Tender Proposals by any community member.
- The proposal should include a summary, specification, deliverables, deadlines, required skills, stakeholders, and any bidding submission details.
- Duration 14 days and 4M VP threshold.
- Minimum required VP to submit a tender proposal: 2,500 VP.
3. Bid Proposal
- A passed Tender Proposal opens the bidding process for third parties.
- The bid should include budget, project duration, starting date, deliverables, roadmap, personnel, beneficiary address, and email address.
- Bid details will be kept confidential by the governance app until the submission period is over.
- The bidding period should last at least 2 weeks.
4. Selection Proposal
- All bids received will be revealed at the same time and put up for a community vote for 2 weeks. Each bid will need to collect at least the VP threshold of the requested budget to be considered passed.
- The passed bid with VP simple majority will be considered the winner. The voting process should implement Snapshot’s ranked or weighted voting.
The following articles should be included in Decentraland’s documentation for future reference.
Placing a bid implies acceptance of an offer in its entirety, including all of its requirements. If the bid is selected, upon initial payment or initial work of the bid, all elements are considered met to consider this a binding contract.
Studios or freelancers may formulate proposals individually or in the form of a partnership as long as they fulfill all requirements and must be included as co-authors and personnel.
The economic proposal must be presented in USD dollars. It will be paid in stablecoins using the vesting contract subject to the conditions of the Grants Program.
Bid proposals that do not cover the full project will be rejected.
Deliveries should be in the form and within the deadlines expressed in the Tender Document, otherwise bids will be rejected.
The community may ask the bidders on the grant proposals to provide complementary information about the company or the proposed solution.
The winning bid will be converted into an enacted grant, following the same policies that govern the Grant’s Program.
In the event that there’s only one valid bid available, a second call should be made. At least two options should be available to decide.
The Bidding and Tendering Flow has the potential to bring about significant changes within the Decentraland community, depending on a range of factors.
In the best-case scenario, the proposal is implemented smoothly, allowing the Decentraland DAO to identify and allocate resources to strategic projects in a transparent and efficient manner. This could lead to increased satisfaction and trust within the community, as well as potentially attract new talent and businesses to work with the organization.
However, it is possible that there may be some initial challenges with the implementation of the proposal, which could be addressed through updates and additional guidelines or training.
In the worst-case scenario, the proposal is not implemented successfully, leading to a lack of progress on important projects, decreased satisfaction within the community, and potentially a loss of trust in the DAO’s decision-making processes.
It is worth noting that this proposal will co-exist with the Grants Program, and a new governance proposal aligning both systems may be developed in the future.
The Governance Squad should implement the following changes:
- Update Decentraland documentation with detailed requirements.
- Create a submission form for Pitches, Tenders, and Bids.
- Create a voting view for Pitch, Tender, and Selection proposals.
- Support a new voting system (ranked voting) to pick among bids.
These changes are all feasible and can be developed in parts, starting with the Pitch proposal, followed by the Tender and Bidding Part, and finally with the Selection proposal.
The Grant Support Squad should be responsible for measuring performance metrics for each project and overviewing its roadmap progress. A project should be revoked if such performance metrics are poor or fails to meet any of the requirements.
The Bidding and Tendering process is a method to select the most suitable service provider or supplier, by comparing proposals against specific criteria. This system encourages fairness and transparency of opportunities, as well as the effectiveness of funds allocation.
The proposed Bidding and Tendering approach aim to separate the process of deciding what needs to be done, from the decision of who should make it happen.
The Pitch and FAQ it’s a good method to align the community on the final goal of the project, it can be the guide during the development process and the final success evaluation.
In order to have an effective bidding process it’s important to get many competitive offers from different suppliers. This will require an active effort from the community and DAO core units to make sure the Tender Proposal reaches as many studios as possible.
The Grant Program and the Tender and Bidding system will coexist, the first being the foundational layer for the second one. Eventually, the community will form some sort of criteria regarding which projects should go directly to the Grant Program and which ones deserve to go through the Tender and Bidding process.
The proposed scheme aims to be the minimum viable framework to test this idea. Future improvements might involve incentivizing stakeholders to craft tender proposals and oversight the progress of the project. Also delegating to a committee the decision of which bid is the winner might be more effective than a community vote. But for this stage, it’s better to start simple and iterate later using real-world experience.