By Alex Woodard(Arca), Daniele Sesta (Frog Nation), Contributors
Arca and Daniele/Frog Nation have combined elements of both initial proposals to provide a final version of the proposed restructure.
Sushi has operated with a flat organizational structure driven by specific cults of personalities. However, DAOs and digital asset protocols are still very nascent and require structure to continue to grow. Over the past year, Sushi has seen tremendous success in community-driven DAO and protocol efforts, but as the protocol scales, it needs proper structural hierarchy, resourcing, processes, and principles for the various teams that are building under the Sushi DAO.
This proposal outlines the details of a new DAO organizational structure for Sushi core contributors that will allow the team to ship best-in-class community-owned products while providing more oversight and transparency to the Sushi community. Additionally, this structural proposal will be used for future DAO’s, similar to Sushi Samurai’s, building on top of Sushi and Sushi’s treasury. TL;DR: The following updates to the framework of Sushi DAO are proposed in this post:
Establish a new service collective through a community vote and transition the existing ops multisig to the discretion of the new collective (see the new collective section below). Treasury multisig will remain subject to governance. The hierarchical structure of this new collective described below will be tasked with continued protocol development, expansion, and business development.
Recommendations of structure for this new collective. The recommended collective structure will follow a product teams format that will fully resource each SUSHI product line and allow it to scale. This is further outlined below.
Recommend a new hierarchical structure that will clearly delineate roles and responsibilities for the following lead individuals. These individuals will work together to oversee the transition to the outlined structure and oversee the development of the vision established through governance.
We propose in this new service collective the following initial positions if these persons wish to accept:
1. Daniele Sesta as Head Visionary/Strategist 2. Omakase as Head of Operations and Business Development 3. Matthew as Head of Engineering
Establish further checks and balances and community oversight over Sushi’s roadmap leadership, and transparency.
Establish a clearer mandate of what decisions have to go through a governance vote, versus what decisions are left to the service collective.
In just one year’s time, Sushi has grown from a single-product DEX to establishing itself as a key player in Defi with a community-driven defi suite of six complementary products with Sushi DEX launched on ~15 chains. This growth has been phenomenal but has led to natural growing pains that need to be addressed. The growing pains combined with the lack of hierarchy have led to some of the Sushi products not being fully resourced and missing deadlines on updates.
This proposal aims to adequately structure the service collective, and future collectives developing Sushi, with processes, structure, and oversight in order to capture and capitalize on future growth.
Our goal is to give the service collective as much autonomy and flexibility as possible to effectively develop community-owned defi products while ensuring that all Sushi stakeholders continue to be the checks and balances system via governance.
Proposed Collective & Restructure
The goal of this new recommended collective structure is to:
- Align the service collective through clear governance oversight
- Add scalability through the creation of product teams within this service collective
- Create clear leadership and hierarchy within the service collective to allocate resources, dictate growth strategy and business decisions, and the power to on and off-board contributors
New Collective Structure
The structure of the new collective will:
- Create product teams working on specific product lines under a well defined hierarchical structure as outlined below and
- The breakdown of contributors through the creation of an OSC (Open-Source Contributor) levels model. It will also allow for this service collective to utilize its own entities where needed rather than contributors paying for integrations and other expenses out of pocket. If new entities are necessary, the new service collective will work with legal counsel to establish an entity based on best practices.
Product Teams Structure(written with feedback from contributors):
Ultimately the service collective retains discretions to modify the following recommendations. We feel after reviewing and speaking to various stakeholders this would be an initially optimized model during the transition. However, we expect iterations to occur. Governance retains oversight of the general service collective, budget requests, as outlined in the Governance section.
- Human Resources
- Community Management
Every product team would consist of one or multiple contributors focused on product, designers, front-end, solidity, web3, marketing, & business development. Some of these contributors will be available to work on more than one product, but all products will have at least one of each. The distribution of the existing contributors across these products will be determined by an internal poll that gauges their interest during the restructuring period.
We recommend the creation of product-specific teams, composed of contributors that work within these teams but that also report to both VPs and subsequently Heads of three major groups. The groups and general responsibilities are as follows:
Head of Strategy: The Head of Strategy will have oversight of growth marketing strategy, design, roadmap, and go-to-market strategy. They will also work with leadership and governance (in accordance to the governance oversight section below) on executing partnerships. They will work to assess profitability on all business lines and work with the rest of the collective’s heads to allocate resources accordingly. They will work with all teams to outline KPI’s and well-defined timelines on current and future products.
Head of Operations and Business Development: The Head of Operations and Business Development will oversee the product managers, business development, and infrastructure to allocate resources according to the roadmap and governance-approved grants. They will work to assess profitability on all business lines and work with the rest of the collective’s heads to earmark all resources accordingly. In the transition period defined below, they will work with and report to the Head of Strategy.
Head of Engineering: The Head of Engineering will oversee the development of Sushi products and the roadmap. They will manage all Solidity, Frontend, and Backend and allocate engineering resources to each of these teams in accordance with the roadmap and governance-approved quarterly grant. In the transition period defined below, they will work with and report to the Head of Strategy.
VP (Vice Heads): Strategy, Operations, Engineering will have vice heads to execute and retain discretion over specific products and teams. They will be selected and promoted from teams at the discretion of the initial collective Heads to work with and extend specific responsibilities. VPs report to their respective Heads. If a Head is unfilled, they will report to any available Heads in tandem.
Marketing: Marketing should include product marketing, content marketing, digital marketing, and work with other product teams to have consistent brand and marketing efforts across all business lines. The marketing team will cross-coordinate with other products.
Product: Full understanding of the scope of the product from initial wireframes to building out the product to designing go-to-market strategies, as well as overseeing business development and marketing efforts. They would work closely with leadership to develop quarterly/yearly roadmap, team budget, team KPI’s, present updates at company-wide meetings, and communicate with leadership and operational multisig on hiring and firing to make sure the product team is adequately staffed.
Designers: UX and UI designers are responsible for building the frontend interfaces, iterating user personas, and designing user tests. Other areas include supporting marketing with marketing assets.
Frontend: FE devs should be responsible for implementing mockups as well as a deep understanding of web3 and developing apps that interact with smart contracts.
Solidity: Solidity devs are in control of the core functionalities of the product and ensure infrastructural compatibility with the rest of the product.
Business development: BD focuses on bringing the product to retail and institutions, as well as onboarding inbound leads.
Human Resources: Human Resources will manage relationships within the team(s), along with onboarding/offboarding procedures and salary/bonus structure.
Finance/Accounting: Finance/Accounting will manage funds and process payments within the new entity. They will be responsible for monthly invoices as well as other expenses.
The leadership team will work together to develop and execute a roadmap. They have discretionary powers to allocate resources to the different product teams based on the roadmap and opportunity set. They also have the power to onboard contributors as well as set KPI’s for each contributor to hit. All decisions will go through a vote between the Head of Strategy, Head of Engineering, and Head of Operations and Business Development. This will ensure that all aspects of Sushi and its products are represented in the decision-making process as well as prevent one team lead from taking too much power. In terms of offboarding, the Head of Strategy will work with the leadership team for on and off-boarding but ultimately has the final decision on that process.
Service collective multisig
The service collective will inherit the operational multisig, however, will not have discretion on any protocol-level changes with regards, some examples pertaining to:
- Modifications to xSUSHI
- Modifications to tokenomics (vesting)
After a 2-Month grace period, the monthly distributions from the treasury to ops collective will end and be replaced with the new service collective grants request. See the Recommendations on Governance section below.
Later this year, the service collective will reduce discretion over, with consideration of proper established processes to governance:
- Onsen additions
- Miso featured
The operational multisig will retain the right to assign members where appropriate to balance efficiency as well as security. The operational multisig and treasury multisig will remain separate and with separate individuals. No individual should not sit on both. The operational multisig is recommended to comprise of no less than 5 individuals. They are bounded by the same traditions of governance with regard to protocol modifications.
Recommendations on Governance
Both proposals specify the need for better governance definitions. This proposal also aims to establish the following parameters:
- Governance cadence: Governance cadence for proposals will take place every 2 months. All voting will begin on the 25th of the second month. All proposals will need to be added to the governance forum by the 15th of the first month to allow for community review and any necessary changes. If a proposal is not submitted by the 15th, it will roll over into the following voting period.
- The service collective will have oversight over the implementation of grant distributions in order to ensure implementations remain coherent and consistent
- Snapshot process: recommendation of the initial requirement of 200,000 SUSHI to trigger a timed-release snapshot. This requirement can go through subsequent iterations through governance.
- Potential incorporation of Optimistic Approval for future modifications and decisions that cannot be well defined by governance
- Governance will continue to oversee the allocation of all Treasury assets. This includes overseeing all grants to the service collective as well as grants from the upcoming Sushi Rolls platform to better manage grant distributions. Examples of this include the creation of Shoyu as well as the recent Tokemak and Flipside CEA proposal.
- We recommend deprecating any ongoing disbursements from the Treasury after a 2 month grace period, after which disbursements will default to a grants process. As such the service collective will need to produce additional budget requests to fulfill its runway and roadmap.
- The service collective retains its own discretion to generate revenue to supplement operating expenses - however revenue derived from Sushi products, in particular, would be considered a modification to tokenomics and therefore subject to governance
- To incorporate the mandate for action from other structuring proposals, we recommend the Head of Strategy be given primary leadership to handle the transition. Other structures within the service collective will be at their initial discretion but initially based on the recommendations above.
We see our proposed structure as an outline of what we think would be scalable and lead to more community transparency. But as pointed out in the forum, there are numerous additional questions that need to be answered to move Sushi to the new structure. Because of this, we propose the outlined leadership of the service collective to oversee the transition. We also recommend that each chain and product line must first be analyzed in terms of profitability to understand whether more or less resources are required.
The transition period will last 3-6 weeks starting in Q1 and be overseen by the proposed project leads. The transition will move service collecting to the new operating structure of the Sushi governance and address all additional important details that this proposal does not address. They will be responsible in overseeing the following recommendations:
- Creation of Product Teams, with a service collective level hierarchy for onboarding new contributors:
- Allocation of contributors to each product team
- Oversee onboarding and offboarding during this transition period
- Oversee first proposed Q2 budget/grant request for governance, after 2 month grace period
- Creation of the 2022 roadmap
- Any other items that need to be addressed during the re-structure
Additional Checks and Balances
To structure in accountability we propose the following additional checks and balances:
- Aggregate leadership (Heads and Vice Heads) of the service collective will be reviewed annually by governance. Additionally, a vote to renew the service collective will occur annually with the first votes for both taking place in June 2022.
- Leadership from the service collective will develop a quarterly grant approved via governance proposal and approved by the community, to then allocate resources effectively to each product line. If additional funding is needed during a quarter, leadership can submit an additional proposal for governance approval. Salaries, compensation should also be part of annual budgeting and proposals. It is up to the discretion of leadership to handle the dispensation of salaries and bonuses within the service collective.
- Leadership from the service collective will develop Quarterly and Yearly updates for the community similar to tradfi 10Q/K’s.
- Leadership from the service collective will participate in Monthly AMA’s to update and hear from the Sushi community.
- Governance will continue to oversee the allocation of all Treasury assets. This includes overseeing all grants to the service collective as well as grants from the upcoming Sushi Rolls platform. This will include any DAO-level partnerships. Examples of this include the creation of Shoyu as well as the recent Tokenmak and Flipside CEA proposal.
- In accordance with this proposal, governance will now have discretionary power over the service collective. This includes annual reviews of the quarterly reporting to be provided by the service collective.
- Governance will also continue to have oversight on protocol modifications and tokenomics, including any changes made to xSUSHI.
- Governance will have the ability to issue a mandate via governance to the service collective. This restructuring proposal as well as a future Code of Conduct proposal will fall under this category.