During the search for Sushi’s new Head Chef, The community has expressed concerns around incorporating both the compensation and the candidate together into one proposal.
This proposal is to suggest that the DAO should define a set of parameters for compensation for a Head Chef.
In the recent proposal from Jon Howard, the following was proposed:
Salary: 700,000 USDC per year
Sushi Roadmap Bonus Structure: 350,000* criteria for achievement to be published to the community ahead of time.
Price targets defined as 12 tranches of 30-day TWAP. To earn the entirety of the tranche, the 30 day time weighted average price would have to be above the $ amount for 12 months :
200,000 $SUSHI tokens @ $5
250,000 $SUSHI tokens @ $7
250,000 $SUSHI tokens @ $9
300,000 $SUSHI tokens @ $11
200,000 $SUSHI tokens @ $13
12 month contract, 6 months’ severance.
This proposal can provide more data from the community, and work towards the compensation package for a new Head Chef.
Polls with tiers can help guide the DAO.
The following are polls with a lot of granularity. The approach here is to try and start wide and gather a large data set from the community, and refine later after collecting data.
The polls listed below have dual voting, as to show the voting differences between those with Trust Level 0 and Trust Level 1 or higher. These polls are designed to collect data to gauge sentiment from the community. If you are Trust Level 1 or higher, please vote on both polls for each category.
12 Month Base Salary (Trust Level 0)
700,000 USDC
600,000 USDC
500,000 USDC
0voters
12 Month Base Salary (Trust Level 1)
700,000 USDC
600,000 USDC
500,000 USDC
0voters
Keep current price target ranges? ($5,7,9,11,13) (Trust Level 0)
Yes
Adjust the ranges
0voters
Keep current price target ranges? ($5,7,9,11,13) (Trust Level 1)
Yes
Adjust the ranges
0voters
Total amount of SUSHI Tokens for Roadmap Bonus Structure and Price Targets over 4 years: (Trust Level 0)
750k
1.00m
1.25m
1.50m
0voters
Total amount of SUSHI Tokens for Roadmap Bonus Structure and Price Targets over 4 years: (Trust Level 1)
Proposals are long and complicated. I’m tired. Anyone else?
Anyway, this is a good proposal and it feels like we’re thinking about things more reasonably and I like the idea of splitting these proposals and getting a cleaner view of the items we’re voting on.
We still think a $700K base is well-above market. Our vote would be for a $500K base, which is still generous but more palatable.
No immediate concerns although we wonder whether this component be crafted more effectively to (1) increase transparency and (2) provide a mechanism for regular community oversight. For example, rather than implementing a one-time bonus, we could consider utilizing a reoccurring bonus (i.e., quarterly or bi-annual) based on achievement of pre-determined criteria, as developed by the Committee and as approved by the community. This way, Sushi maintains the flexibility to adjust KPIs based on evolving business model/market dynamics and the community has regular insight into KPI development/achievement. If this approach is pursued, then the total Sushi per period will likely need to be reduced from 350,000.
The community should vet the price targets, but the increased hurdles are appreciated and we have no immediate concerns. Our only comment pertains to the vesting requirement. In an extreme scenario, suppose Sushi’s price increases to $13 on day one and remains above that level for 12 months. Suppose the price then falls below $5 and stays at that level for 2-3 years. The candidate would earn all tokens following the 12 month achievement despite Sushi “underperforming” during their service period. In other words, the grant does not have much retentive value following a prolonged bull market. We could consider attaching time-based vesting minimums for each tranche. For example, minimum service of 1 year for tranche 1, 1.5 years for tranche 2, 2 years for tranche 3, 2.5 years for tranche 4, and 3 years for tranche 5.
And some questions below:
What is the definition of “severance” (i.e., what pay components are included)? Also, when would severance be triggered (i.e., what are the termination events)?
Just to be clear, the Guaranteed Sushi Incentive of 600,000 total $SUSHI vested over 4 years is no longer part of the candidate’s package? Why not?
I’m glad to see this proposal separated out to focus on compensation.
It seems most of the originally proposed metrics were fair - the only adjustment is the base salary and $SUSHI ranges.
Once reaching a consensus, we advocate running a similar proposal to evaluate candidates - with Jonathan and others. After such, a single name can proceed to Snapshot to be formaly elected.
I’d like to weigh in on the comp package. Whatever you chose should be rational and seen to be fair. (1) Voting for comp is democratic, but could still give the wrong outcome. No applicant from the role should have any say in their pay and conditions of employment. Companies benchmark employee packages against others in the space and this data is easily available. (2) Pay structures should be judged ‘fair and reasonable’ by the community. For example, using a nominal example, if base professional pay is $100k pa, senior professionals (managers) might earn 2x ($200k), and the CEO might earn 2x that ($400k). (3) US employment is ‘at will’ and termination packages are seldom more than 3 months. (4) You’re hiring a CEO to improve the organization and revive the price. Compensation should be weighted towards Sushi options/allocation. Progressive vesting, with an allocation every 3 months, and having met defined business revenue and Sushi price milestones, is fair. If you want to incentivize the while team, pay good salaries across the organization, reward success with generous token allocations, and have mechanisms to deal with under-performance, malfesance of bad behavior. This will gain support in the community, from stakeholders, and a united team Sushi.
Well said. Most aspects of the proposal sound ok to me, but even six months’ severance seems ridiculous considering the base salary. When just the severance package puts someone in the top 1% of earners in the U.S., it kinda seems counter to many of the principles embedded in the goals of DeFi.
I’d like to weigh in on the UPDATED comp package, with the votes just closing which looks about right [and isn’t being imposed as before, which would have been a misstep]. Tuning my previosu thoughts …
If I understand Signal voting: $500k salary / $750k token bonus (linked to operational milestones & price targets?) / 12m cliff / 6m severance. (I don’t understand what 24-month contract means … US employment is ‘at will’ … anyone can be fired at any time, so 6m severance is the key clause.)
Pay structures should be judged ‘fair and reasonable’ by the community. For example, using a nominal example, if base professional pay is $125k pa, senior professionals (managers) might earn 2x ($250k), and the CEO might then earn 2x that ($500k). Option terms should be unified across the team.
The Comp committee AND an HR process, reviewing and supporting the team, should review and align all aspects of comp. Every ‘employee’ needs a contract which outlines, role, responsibilities and comp.
If you want to incentivize the while team, pay good salaries across the organization, reward success with generous token allocations, and have mechanisms to deal with under-performance, malfeasance of bad behavior. This will gain support in the community, from stakeholders, and as importantly from a united team Sushi.