[BIP-275] Request to Compensate Contributors in Liquid BAL

Service Providers Orb Collective
1

Note: no on-chain execution is required by the DAO Multisig if this passes

**This proposal would only approve the following spending of BAL: **

A) 7,333 BAL (~$44K) retainer fee for our ecosystem legal advisor through the end of July.
B) 440 BAL (~$2,640) April comp for our marketing contributor Chun Li.

In Orb’s 2022 funding proposal, we were approved to receive 398,527 BAL to be used for contributor compensation on a vesting basis (1 year cliff, 4 year vest). This amount was based on our projections for current (at the time of the proposal) and future contributors.

Since the funding proposal, Orb has parted ways with a few contributors and has cut back on its hiring plans. Because of this, we currently have 103,036 BAL that has been approved and not yet allocated.

At the same time, based on the desires of the community, Orb is working on shifting more of its contributor comp into BAL instead of fiat, to help the OpCo preserve the DAO’s stablecoin treasury. This requires Orb to be able to pay liquid BAL to contributors in lieu of stablecoin-based salaries.

For this reason, we are requesting permission to utilize the BAL that has been granted to Orb to compensate contributors in liquid form, rather than only in vested form.

For extra clarity, this proposal means stablecoin-based spend would decrease and the amount of USDC returned to the OpCo would increase. Being granted permission to utilize liquid BAL would enable us to propose new comp agreements to existing contributors that replace USDC with BAL. It also allows us to engage with new contributors on an all-BAL basis. We are not requesting to supplement existing contributor comp plans with additional BAL.

As we have done every month, we will continue to return USDC to the OpCo.

Orb’s BAL numbers:

  • Total BAL approved in 2022: 398,527
  • BAL allocated for current contributors’ vesting plans: 295,491
  • BAL unallocated: 103,036
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Thanks for bringing this proposal to governance, as I’m not sure how much flexibility we’d have to sign these transactions without approval, as the BAL seems earmarked and should return to the Treasury.

If approved, this proposal potentially gives Orb another ~600k USD. Would you mind further explaining how much of this will you allocate taking from the original stablecoin budget / how much you predict to be your savings (BAL fluctuation aside) to make this worthwhile?

Also, I couldn’t seem to find updates on your budget for Nov and Dec:
Aug-Sep-Oct
Nov-Dec ?
Jan-Feb-Mar

I’d say it would be best if you and OpCo can give us an update on which or how many contracts were terminated on your side, and return BAL to the Treasury asap. It is just too much BAL to be laying under the Foundation wallet, unnecessarily. Only then you’d make a proposal for returning saved USDC (from people that been cut or resigned) and getting a new BAL allocation for new contracts as needed.

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Hey @0xDanko,

Again, to make sure it’s clear, we were approved to spend this BAL on team comp, on a vesting basis. We are requesting to spend this BAL on team comp, on a liquid basis. We are not requesting additional funds and it may mislead some readers when they see your comment:

This proposal does not give Orb another 600k USD. Orb is already authorized since August to spend this 600k USD. We have been preserving it and spending it strategically.

[Edited for accuracy] This BAL came from the token incentive fund within Balancer Labs which sent it to the DAO treasury, which then sent it to Orb.

If made liquid, the majority of this BAL would go towards restructuring existing team member comp, changing a percentage of Orb’s year 2 burn rate from fiat to BAL.

I can’t predict how much each team member will agree to receive in BAL instead of fiat. If the DAO would like us to take this step, and thus votes yes on this proposal, I will then proceed to have those conversations, the results of which can be reported in this thread and in our year 2 funding proposal, or wherever else the community would like it to be reported.

[Edited] I’m not following you on the question of how many contracts were terminated. Every person who has been released from the Orb team thus far has been reported in our monthly updates and DAO community hall meetings.

We “return” saved USDC each month to the OpCo by subtracting it from our monthly invoice for the following month. We don’t have a stockpile of USDC sitting in our wallet waiting to make a proposal to return it.

4

Alternatively we could continue to allocate the BAL being discussed on a vesting basis only, if that’s what the DAO prefers.

In that case we would either need to make a proposal for BAL to use on a liquid basis to pay contributors in the short-term, over the remainder of year 1, or we could pay them in USDC as originally planned, instead of shifting into BAL.

Either way, our year 2 proposal would request a combination of liquid BAL and USDC, with the aim of further minimizing stablecoin burn rate (beyond cost cuts and team downsizing) by proposing comp packages that feature more BAL and less USDC.

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I believe not to be misleading, on the contrary. Just trying to get some needed clarification.

Seems like I had a misunderstanding of the BAL tokens purpose on the approved specification here. It would indeed cover “future team members” so all good if you want to propose it to be liquid from now on. I was under the impression they were just honoring previous hires, not future.

However, at OpCo/Foundation level we can’t sign transactions that were not previously approved by governance and would be best if you specify your intentions better. Some flexibility is good, and as long as its transparent we would have no issues moving forward. It is your job to state the correct specifications of your proposal, not of the community (or mine) to scatter around multiple updates and meetings and predict how much this is going to affect the DAO, if you can’t predict it yourself.

To be honest, I think this is the best approach. We are a little late on Year1, so it would be best if you can honor previous agreements. Anything new would mean peanuts for the remainder of Year1 and would certainly be smoother on the diplomatic governance effort imo.

To clarify this question regarding the return of funds to the Treasury, this needs to be made super-clear. These funds were earmarked, but they belong to the DAO. For the contracts terminated and not being replaced by “new hires” (which I believe to be the case for all of them thus far), OpCo has the responsibility to return corresponding BAL to the DAO Treasury and that’s why I reason the allocation would be “another” 600k because you’d be effectively be removing the earmark.

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A few questions:

  1. There is a mention of plans to transition contributor comp to BAL instead of fiat. But looks like there is no BIP where this was discussed and authorized. Could you point that out?

  2. In your discussion, you are hinting at a change in the composition and compensation of the members: could you point out if there was a public discussion about these topics?

  3. Wasn’t the current BAL allocated for the current funding period? Shouldn’t it be sent back to the original owner when it is over? And shouldn’t you, after that, ask for a specific budget that suits Orb’s needs with all the changes, and not just ask to repurpose the leftover BAL?

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7

This has sparked a healthy conversation which I haven’t had enough bandwidth to fully follow as we’ve got multiple heavy projects to complete over the next ~9 days.

So for now I propose the following:

  1. For April, we request to spend 7,733 liquid BAL from Orb’s pre-existing allocation. This covers:

A) 7,333 BAL (~$44K) retainer fee for our ecosystem legal advisor through the end of July.
B) 440 BAL (~$2,640) April comp for our marketing contributor Chun Li.

  1. For April, we will compensate the rest of the team as usual in USD.

  2. We will circle back for May to discuss open questions and determine the right amount that needs to be requested based on each contributor.

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This sounds super exciting. Do you have any details (even a sentence or 2) about what these projects are, and where we will be able to see the results once they are done?

I think focusing more on deliverables is always good!

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Sure: offboarding 2 contributors, transitioning their work, reviewing applications for a backfill role, team monthly updates, q1 retro financial update, taxes, terminating our EOR (Pilot), transitioning the payment method for 4 contributors, slide deck for board meeting, contributor comp restructuring plans. There’s more but hopefully that provides more transparency for now.

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I don’t have the impression that the community reached consensus on how to move forward with this request. I would like to see a proper specification with estimates / forecasts on why and how that BAL will be spent.

Also curious why this has to happen now / in the next 9 days. If this is truly time sensitive, I would argue that you as a CEO would have identified this need earlier.

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A) 7,333 BAL (~$44K) retainer fee for our ecosystem legal advisor through the end of July.
B) 440 BAL (~$2,640) April comp for our marketing contributor Chun Li.

12

This seems like a good specification to be voted on and I’d be ok having it up this week if it’s pressing.

IIUC, those are new contracts, but still under budget. Honestly, it’s minimal considering what we had previously budgeted for Orb but would make multisig more comfortable with governance approval since you are using the BAL tokens as well.

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https://snapshot.org/#/balancer.eth/proposal/0xe8be9405b6b2096c183224d61fede52fcf394156f7dc4d71c725a983e4dcd2c5

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For the record, “auramaxi” is the official, shared account of Aura’s forthcoming SP, the Aura Maxis. The initial group consists of 12 outstanding individuals (not myself) actively involved in the Aura/Balancer ecosystem. To get up to speed, they spent several days researching Orb’s background, reviewing all relevant BIPs, and discussing the present issue at length, in order to craft informed questions and make their first post on forum, which, quite frankly, appears to have just been blown off entirely.

Moreover, there was no mention that this would become a BIP-XXX or even a RFC. It’s miscategorized, was rushed to Snapshot, the post itself doesn’t even follow standard proposal formatting. Where are the specifications? This is a “comment” that became a BIP w/ no community discussion. This is not a good start for our Maxis, not good governance, and reeks heavily of insider dealing.

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I think we can all agree it’s not ideal, but also not wanting collaborators to get rugged on their payments because of others people’s mistakes. The original proposer is responsible for timing the snapshot and @immutbl did justify the rush.

Also, I believe we reached a very delimited specification to be voted on. Reading through the proposal and discussion that followed, it’s clear to me it was needing a snapshot. Wouldn’t need to exist as a “comment” and it was first posted as a “request”. I even stated we are just doing it to be extra careful with transactions and approvals, since the spec reached is under the approved budget (although using BAL).

For full disclosure, I’m one of the multisigners for these transactions, so either way works for me as long as it’s decided by governance and not an executive decision by Orb.

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Thank you for sharing your thoughts and for advocating for transparency. To promote greater alignment with our governance process, we have established internal guidelines with Aura delegates. In my view, we have made significant progress in bringing all stakeholders together and fostering a shared understanding of how we can advance the protocol. We aim to maintain a truly decentralized community and avoid excessive rules and regulations, but the recent rushed vote is an example of a proposal that lacked full consensus.

There were obviously outstanding questions that needed to be addressed, particularly regarding Aura Maxi’s concerns. While I understand that the funds are needed urgently, I question whether the leadership and management of this initiative were appropriately handled. Moreover, the timing of this proposal is particularly critical given the upcoming year 2 funding for Orb Collective.

In my view, this situation could have been handled in a more elegant and collaborative manner, particularly by aligning a year 2 proposal with a revised compensation structure for Orb employees. During in-person discussions with @immutbl at the on-site event in Barcelona, we had requested a forum post for full disclosure but it seems that our understanding of what needed to be done is differed from @immutbl’s request.

I believe that the leadership of Orb Collective may be completely out of touch with the DAO and its community which is really concerning.

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It’s really disappointing to see such a poorly written proposal with such a consequential impact be rushed to a vote for no good reason.
Sir, if you don’t have bandwidth to manage your team’s comp plans and do some basic routine operations simultaneously and require emergency measures from the DAO to backfill you then how can the community trust in your ability to execute critical work?

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I may be a little slow this morning, so if you could help with these few questions I have, I would really appreciate it.

What exactly does “BAL unallocated: 103,036” mean? I mean, I know it involves 103,036 BAL, but what exactly does it mean for that BAL to be unallocated?

How much of the 295,491 allocated BAL has vested to date? If nothing has yet vested, when is the year 1 cliff expected to hit in relation to year 1 vesting? And how much BAL will vest when the year 1 cliff hits? Also, after year 1, I assume the next vesting date is the year 2 anniversary? If my assumption is wrong, by all means please correct it!

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19

Thank you everyone for the feedback and questions.

My apologies for posting a rushed proposal without sufficient context for the community to make a well informed decision.

I will follow up with a more clear and thoroughly written overview that addresses the questions on this thread, and with more time for discourse to take place.

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