The old DAO structure, together with the Grants program, did not allow free competition between bidders, causing many projects to be priced above market. Fortunately, the new structure will allow a new opportunity in contracting services, but special attention must be paid to certain points that I will mention.
Quotations
Although the tender is a procedure that I like more than the Grants program due of the implicit competition that it entails, it is still a procedure that is not sufficiently adequate to obtain the best quotes.
Instead of a tender process, I consider it more appropriate for the new DAO to ask for isolated quotes from multiple suppliers. This provides greater flexibility, agility and gives rise to more active negotiation.
Agility
We can plan for short-term situations, but sometimes we have to proceed with some uncertainty. In these cases, it is necessary to test the most plausible initiatives, assuming possible strategic mistakes or unfeasibility, so that the operating arm must have an agile capacity to change direction when necessary.
By this, I mean ensuring that the most critical deals or those that involve several months of development have clauses for cancellation or modification of the service. In addition, the new structure must have the capacity to carry out pilot tests frequently without incurring enormous costs. Incorporating an internal team dedicated to this and fluid communication with Foundation would be a good option.
Transparency
If approximate, maximum or minimum amounts are published before finalizing deals, detailing which specific initiatives will be spent, the DAO will be unable to negotiate, being able to access only overpriced services. To avoid this, the information regarding the funds to be allocated should be shown by generic categories, trying not to reveal what amount will go to a specific project. This practice will allow the outsourcing department to have greater flexibility to negotiate deals with third parties.
Final thoughts
The DAO spending more than it earns is the biggest threat to its long-term continuity, with these brief recommendations, the DAO will be able to optimize the procurement of services, but it is vitally important for the success of the platform to address many other issues beyond the efficient expenditure of resources, including:
- Implement new revenue channels: Is not necessary to have a large user base to achieve this. Decentraland has recognition within the industry that it can take advantage of, as well as an infrastructure that can be adapted at a low cost to develop other business models.
- More engaging user experience: I’ve proposed some ideas here (Brief thoughts for the future of Decentraland), although I would recommend doing surveys on users of other virtual worlds to have direct knowledge of the real interests of players on different platforms beyond Decentraland in order to improve the experience accordingly.
- Influence the Asian public as soon as possible: Omitting the Asian territory would be a serious mistake.
- Preparing the ground to incorporate the African public: This territory is not very popular at the moment but it represents a great opportunity in 10 years’ time, maybe I’ll write a post about it in the future.