[Withdrawn] Sushi Phantom Troupe - Strategic Raise

Hey everyone! After discussing on the community call We at Arca released a Twitter thread on our thoughts on the new deal, and how it is priced at +114.29% above the original deal proposed, and sells -53.33% less Sushi than the original proposal. We also wanted to lay out where we think we can be a value add for both the Sushi team and the community. We hope all the strategic investors do the same. If you have any questions or pushbacks on the deal structure or where we think we can be a value add, ask them here and I will do my best to answer them!


I think Jeff has a done lot by stepping in and stopping a disastrous deal from happening. I know John is a big fan of Sushi, not because what he said yesterday, but because he has been a big advocate prior to this proposal. I believe that he was blindsided by this proposal like the rest of us and he stepped in and stopped it.

In regard to Amy, I didn’t think Amy had a chance, especially in my eyes because she was linked to that initial proposal and IMO just provided typical VC vague talk on how value will be added. Not much substance. But, instead of doing a $60M raise only for the VCs, it has been reduced to only $10M for VCs and major investors. So, we can test to see if what Amy is saying is true. If she does help Sushi great, but if not, it won’t have as disastrous consequences as the first proposal. My criticisms of Lightspeed/Amy mainly stem from the first proposal and their connection with it. If she becomes a part of the Sushi team through a fair proposal, which looks like is starting to come to fruition, I will definitely be rooting for her to bring value to Sushi. I don’t have anything personal against her. And if the deal becomes a complete failure, the consequence is only $10M, instead of $60M, which is something that can be stomached.

I think Jeff said something really important yesterday. We got to keep things simple. I agree 100%. The whole talk of options and warranties I think is causing great confusion and fear. I think its best if we just drop the warranty from the proposal. Also, the talk of this proposal has caused too much speculation regarding the current price of the Sushi token and we have witnessed big players dumping Sushi. This has caused some fear in the community and the belief that market manipulation is at play. I think we need to set this OTC price as soon as possible to end the speculation. I do not think a 30-day TWAP would be a good price to set it for, due to all the speculation and manipulation of the price due to this proposal.


Just scroll down, you should be able to see :slight_smile:

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The main problem for the push of Warrants it creates a lower price floor for dilution in the future for Sushi holders.

They should increase the price of Warrants to, say at $40 that way most present holders wont have a problem with a higher dilution price. If they believe in Sushi the VCs knows even at higher price they get many time over their initial investment after 2 years… with no risk in the mean time and it shows they have in consideration all present stakeholders. If not make your own opinion.

Sushi goal is to be as huge as CoinBase if not better, so in this case the Warrant valuation @ $40 will look as a steal 2years from now. But I doubt Jeff Dorman @jdorman81 will go for that, since hes playing both sides as being the one to help but in the mean time he Orchestrates the whole process timetables, terms and Warrants and strive to win this contest for Sushi Phantom Troupe - Strategic Raise.

Maybe that was the plan all along, I’ll never know for sure but hes the one That I would keep my Eyes on!

Its all about the money dont let them fool you with all their words full of fanciness and misdirecting energy. :wink:

Wonder what @jdorman81 Opinion is on a 90days to 120days TWAP for price anchor on this offering. But I doubt he would even entertain this ideas since it would not be in his interest… But we shall see what comes out of this process soon enough and see all involved for what they are.


Agreed. Set an amount, say 1 million SUSHI, fair price determined at auction.

VCs with stronger conviction (priced higher) will end up with more tokens pro-rata.

No warrants, just have another auction in 3-6 months, the incentive is to do well by the community and remain eligible for the subsequent auctions.


Hi @JTT … to be fair, we stopped a terrible deal from happening, and proposed our own new deal, but we didn’t really have anything to do with the current terms. We like them, and support them, but will always defer to the community on what makes most sense.

Unfortunately, there are infinite permutations available when dealing with derivatives (maturities, strikes, tenors, etc). There is never going to be consensus, and inevitably some people will disagree.

We support the basis structure of this deal… but little tweaks here and there are irrelevant to us. We are going to vote yes as soon as this comes to a vote.


I understand your intentions but I also don’t think its fair to mischaracterize @jdorman81 in that way. He’s been one of the only important funds to release good research and analysis on $SUSHI without asking for discounts and is constantly participating. Also, I agree that it shouldn’t be all about the money… but then again if there was no money involved neither you nor I would be on this forum talking right now.

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I understand what you are saying, but at same time I’m being cautious of “Jesus walking across the Atlantic Ocean” to come to be our Savior. I did not ‘mischaracterize @jdorman81’, I was just inferring to a possibility… Like I said " I’ll never know for sure" but I know one thing for sure… He is no Angel and he didn’t run a popularity contest to get where hes at ARCA as CFA… All I’m hopping for is a fair, uplifting and beneficial process for all Sushi stakeholders and not for just a handful robing the majority of Sushi stakeholders. That is all and I dont think that’s being unreasonable and all Sushi stakeholders should strive for same, including @jdorman81. Action, intention shows end outcomes. All the best.


I agree with your 1st sentence for the time being, but I still have my reservations 'till we know what the final terms are, which it seems are still cooking. Also I do agree the more simple the better… But still can get over that fact that Arca which you represent is #2 on proposals even though you claim that was not your intention to begin with. If it is just used as a place holder for a better deal, I would commend and respect you for that, but if you dont withdraw ARCA before the end of this ‘Strategic Raise’ then your intentions can be construed as Opportunistic the least and I would easily make the next connection and say the whole thing was a trap and setup by The VC and to Quote you [ “we stopped a terrible deal from happening and proposed our own new deals”] I would change that to “we stopped a terrible deal from happening and proposed your (ARCA) own new deal”]… But I’ll withhold final judgement for when the final terms are in and who is part of it. In the mean time I’ll stay cautiously optimistic and let the facts on the ground speak for themself.

P.S. You haven’t gave a direct response of what you Think about a " 90days to 120days TWAP"

From the forum all the talk about the raise has been in terms of USD. Forget about the strike price of the warranty and the OTC price for the sushi token for a minute. How many sushi tokens are going to be attached to this proposal and what’s its distribution? The original proposal was 25% of the treasury. Now from what Omakase said its 20%. So, will the proposal have 10M sushi tokens attached to it? If so, what’s its distribution between the community sale, vc sale, and warranties? If this question has already been answered, my apologies.

How is the warrant anything but laughable and will you write me calls at the same price and terms?

Why is the warrant needed? Why can’t the team just sell more tokens if its needed. Selling “less” tokens at this price isn’t appealing if the warrant backdates using this price (which you argue is tremendously undervalued lol)


broz , getting involved with VC’s is always a mistake when it comes to community led projects , they dont give a $hit about the community , they only care about their exit profit potential ,
Peace and Love yáll


Hello Sushi Fam,

I recently reviewed the new proposal by Arca/Lightspeed. Check out my Twitter thread that outlines my evaluation in detail, including an explanation on how the warrants actually work, since that is confusing folks: https://twitter.com/cryptowsky/status/1419057507545268225

TLDR; I can’t support Arca’s proposal as it currently stands. UMA’s Success Tokens are superior to the VC proposal for the following reasons, which I advise all of you consider:

(1) Less dilution: with the VCs, the # of tokens/warrant are determined at current price. With UMA, half of the # of tokens are determined at current prices. With the other half (call option), the future value of the option is converted to tokens at the price at redemption. This results in less tokens issued, esp. at lower prices. See below, which uses a $17.28 strike for both models. The dilution of the Success Tokens would be even lower considering their strike price was proposed at $25…

(2) Higher strike: VC proposal starts with a $17.28 strike. That is way too low. It is well below ATH. UMA’s starting strike is $25, which is better, but still low IMO. The strike should be well-above $25 because these VCs need to add value above & beyond what’s been realized.

(3) Independence: I think it is a great governance practice for another independent protocol to design incentives for VCs. The VC should NOT design their own incentive. That’s like the CEO designing their own pay package – which never happens assuming good corporate governance. Additionally, having an independent third party administer the incentives makes community involvement way easier.

I think #3 and #2 are the most important considerations. The strike price for the VC proposal is simply too low. We also need to set precedent with how future raises will be conducted. We cannot have these VCs create their own incentives.

I also want to note that I am willing to compromise if the Sushi team prefers to go with a certain proposal. For example, if they want to move forward with the Arca proposal, I think that’s fine- but we need to definitely raise the strike price. Also, we need a commitment that future incentives for VCs will be managed and developed by independent third-parties.

Again, see full detail here: https://twitter.com/cryptowsky/status/1419057507545268225



I think the Sushi community should spend more time reflecting on the way this raise was originally proposed and how bad it was. Multiple VCs from the initial proposal have been selling large amounts of their Sushi position the past few weeks. A few of them have also started to publicly speak out against the new proposed raise ideas on Twitter, now that they know they won’t be included. It would be nice to have more info on how and why exactly the initial 21-VC proposal was ever even suggested.


Just to clear one thing up: UMA is not looking to propose terms. The Sushi community should set the terms! UMA is simply looking to help facilitate the trade (once the terms are set), and to do this in an on-chain / DeFi native way.

We proposed the Range and Success token ideas as structures that we think make sense for treasury management and diversification, for both Sushi and other projects. I think it’s cool to see Arca/Lightspeed move forward with a version of this, and it’s really cool to see @Cryptowsky riff on this too. While I did go ahead and deploy to mainnet a Success token called winSUSHI that pretty closely matches @OmakaseBar’s proposed revision, I did this to showcase how the Success token worked, not to “set” terms.

Once terms are agreed, we can figure out execution.


Hey, let’s start the negotiations on a better foot for all parties.

How about we build a proposal template that VC’s will fill out for this funding round :herb:

This document should include a high-level overview of their Sushi involvement as well as the $$$ they’re proposing and % they need to make.

They should post here.

Then we can get all of the individual parties and negotiate them against each other instead of them saying ‘take this 60m on our terms or take 0’.

For example - if some are willing to take more risk, they can receive more capital %.
If some have better PR, they can get a better profitability but less volume. A really good discount would be OK for more specific actions and less impact on the Sushi economy.

We can get them all into a single poll, and then choose the top winners and split the funding with ranked voting between the winners

Incentives/motivation: One point I would like to bring up is Arca already owns 7.5% of xSushi, that value of which is already north of $50m. IMO, that is probably motivation enough to provide strategic help. I think we should at the very least address: How much additional strategic help or how much more motivated VCs will be in return for $2-5m of additional allocation each?

Would love to hear @jdorman81 and @amywu’s comments on this.

Moreover, it is really hard to say sushi achieve $20/$30/$100 because of VC X. The absolute worst case scenario is we reach $X price and we grant warrants to a VC that did not help but still have to pay the bill (via warrant dilution).

I personally think we should be giving out closer to 0.2 warrants / sushi, at a 3x strike price.

I think the deal is quite financially insignificant to most sushi holders given its size (relative to FDV / MCap). See calculations here and feel free to fork. Also happy to discuss on discord.

Dilution to non-warrant subscribers amount to a mere 0.2% with sushi = $20 and caps out at a mere ~1%. This assumes initial raise price = $8 and $16 strike price or 2x.

However, the upside for warrantholders can be huge. At its current state, sushi treasury is giving warrantholders $10m in value @ $20, and an additional $12.5m / $5 sushi price increase. VCs will be getting half of this.

IMO, there are 2 main levers we can pull: 1) # of warrants / sushi subscribed and 2) strike price. If we model out the impact, it is clear that the impact of # of warrants is way higher than strike price and we should focus on flexing that.

See model here. Open for anyone to fork.

From the #s here, I do feel 0.2x warrants / sushi is a little bit more palatable and a $24 +/- strike seems more fair.

  • This means the prize for warrantholders is $0.5m (or 2.5% of raised amt) if sushi reaches $25 and rises by $2.5m (12.5% of raised amt) for every $5 increase in sushi’s price.

  • This contrasts with the proposed $22.5m (112.5% of raised amt) prize for warrantholders if sushi reaches $25 and an incremental $7.5m (37.5% of raised amt) for every $5 increase in sushi’s price.


It has been nearly a month since the “Sushi Phantom Troupe – Strategic Raise” proposal was first put forward as a possible transaction to discuss with the community. In that time, the community has stepped up in an amazing way to provide feedback—feedback on whether diversifying with strategic partners is the right move for Sushi in general along with more specific qualitative and quantitative suggestions about how to structure such a transaction in the best way.

Among the ideas explored in the community discussion were:

reducing the size of the transaction
making more explicit the criteria used to vet the new strategic partners
not tying the transaction to a discount to market prices
not doing any such transaction at all
having a more open sale process in which anyone could participate
using a Dutch auction mechanic
using warrants or a convertible debt-like instrument instead of outright selling SUSHI
forming a separate development company and selling equity or debt in that entity
and many more

In addition, many community members have also suggested the proposal needs to be restructured—perhaps in minor ways, perhaps radically—to reflect legal and regulatory issues. And some of the potential strategic partners also had important questions about these issues.

When the proposal was first made it did not account for how complex and nuanced all the cultural, economic, legal, governance and other issues of this type of strategic fundraising for a decentralized community could be. The ensuing discussion has been enlightening, and we are thrilled to see this demonstration of how powerful Sushi community governance has become and to set the standards of engagement, accessibility, and transparency for a decentralized autonomous organization.

That being said, after taking into account all factors—the complexity of economic, governance and regulatory issues, the diversity of community opinion, and the current strong position of the Sushi community to keep building on an organic, community-driven basis—there is now a rough social consensus that this is the wrong time to further explore a complex strategic investment proposal. Nevertheless the fundamental objectives to grow governance through inclusion of new partners, new voices that can help this community expand beyond DeFi have been unequivocally achieved and demonstrated by vibrant discussion and continuous engagements across a host of initiatives. Sushi community has never been larger, faster growing, diverse or dynamic at any point in time. The incumbent network effects show the rise of an egalitarian and accessible alternative by efficient design is inevitable.

Therefore, we consider the proposal to be withdrawn and do not anticipate that any similar investment-style proposals will be able to garner consensus from developers, multisig key holders and independent contributing builders any time in the foreseeable future. As always, accessibility is key and remain available to schedule discussions with all current and new community members here at accessibility@sushi.com


Happy to hear this @OmakaseBar. Arca is very supportive of the decision to shelve the SUSHI token sale. While some may see this as a failure in governance because no deal has been achieved, we see it differently. Sometimes the best decision is to do nothing at all. The difference is that historically a decision like this would be made by a small group of people in a closed boardroom. Today, a good decision was made with the inputs of thousands of people, in a public forum.

We think the events of the past few months demonstrate the power of decentralized governance, working exactly as it should. This is the first step towards a more equal, democratized financial system and every person involved from the passive observer to the active discord member should feel a sense of pride. This is a successful governance outcome.

The Sushi community collectively stopped a bad outcome from happening (selling tokens at a massive discount where only a few institutional members would benefit at the expense of all other token holders), and still managed to achieve the goals of Sushiswap (to onboard and engage new and important strategic investors). This, alone, is a huge victory.

The money was ubiquitous. Investors from all areas offered Sushiswap money that it ultimately did not need. The money will still be there should the need arise in the future. But the dynamic between founders and investors has forever changed due to the liquidity of digital assets, the access teams have to several types of investors, and the willingness of true believers and community members to step up to support a great project. In the meantime, individual community members, institutional community members, and strategic investors have all rallied behind one of the most creative, forward looking projects in the DeFi space. We are all strategic partners now, and can all offer our unique areas of expertise to the project, independent of a capital raise getting done. Those who want to own tokens can still buy them in the open market. Those who want to help grow Sushi can access the team and help in any capacity.

This is a case study in successful governance, and we’re thrilled to be a part of history, and the future, at the same time.


Those are a lot of potential investors. I agree with @Bento that it would be good to reduce the list to those who can add value beyond capital. Everyone wants in on crypto projects these days. Few understand them. Even fewer, imo, are able to provide any guidance, insight, or value outside of the dollars. Although, I’m sure all will claim to be able to. Do any of them have any crypto-operator experience? Are they the right size funds for the size of the Sushi product right now? Biggest and most well known is not always the best.

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