In the interest of being as transparent and open as possible, I would like to share with the whole Balancer community the message below that I prepared for the Balancer Labs team. My expectation is that this helps everyone in the community see through our lens and understand what BLabs will be focusing on in the future.
Balancer Labs is just one participant in the broader Balancer ecosystem. Anyone is more than welcome to take a different stance/focus than Balancer Labs: it is ok for different groups to contribute in different ways to the Balancer Protocol.
Message to Balancer Labs titled “Strategy Clarification”
As the market continues to grow it’s likely we, as the Balancer Labs team, may start to feel like we are missing important trends. As those thoughts arise (and I know they have for me), I find it helpful to come back to our goal of becoming a platform for other teams to build on top of.
The broader Balancer Ecosystem will achieve this vision through:
- platform features: Managed Pools, Linear Pools, Asset Managers, Meta-stable pools etc.
- product features: LBPs (copper), index funds (Indexed Finance and PowerPool), forex (HaloDao), fixed rate interest (Element and Tempus), DAO treasury management etc.
Let me be clear, Balancer Labs is not focused on pursuing products that are directly aimed at end users: we want other teams to come up with their own product ideas and succeed by bringing in their own users, communities, bizdev and marketing efforts.
We’ve talked about Balancer being B2C or B2B. But what we really are, what we want to become, is D2D (DAO-to-DAO). We want to be a protocol – represented by the Balancer DAO – that empowers other DAOs to build awesome stuff using our permissionless infrastructure. This is obviously not something that will happen overnight. While most of our current TVL comes from users that added their liquidity through our UI, our focus for attracting new TVL will be through platforms that build on top of us.
This transition should be the north star that guides us in 2022, and it will impact different areas of work in different ways:
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Marketing
- Primary focus on decentralization to ensure the Balancer DAO manages marketing in the long-term.
- Secondary focus on establishing a brand which can be used by other protocols.
- A continued focus on product / partnership marketing that establishes the Balancer Brand as one that other DAOs are or should be building on.
- Beginning the foundation of developer marketing with a focus on power devs building projects, not developers new to the space. As the SDK team is established and teams have an easier way to integrate with the Balancer Protocol, our focus on developer marketing will also increase.
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Smart Contracts / Core
- The SC team should continue to think about innovations that allow other teams to build their platforms and products on us.
- New ideas in DeFi come at breakneck speed: we are seeing an influx of derivative projects, PCV protocols, Liquidity as a Service platforms etc. that need flexible and configurable AMM Modules that integrate with other layers of the DeFi Primitive Stack.
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Integrations
- The team should be expanded as we see more and more demand from other teams to build on Balancer and as integrations becomes our main funnel for scaling.
- Integrations should also consider how to improve documentation and first examples of implementations that other teams can leverage.
- High impact integrations like Fei’s will get more hands-on help from us while lower impact ones will have to rely on our docs/discord support.
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SDK
- The SOR team has been renamed to SDK in recognition of the fact that other teams need much more than just our SOR, they need a suite of helper functions and simple ways to code using Balancer.
- SDK will be one of our core and most important teams going forward. We should consider aggregators as its primary customers and our frontend team as its secondary customer.
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Partnerships (also known as biz dev)
- Our partnerships team should focus on feeding the integrations team with high impact integration projects. This team needs to be on top of what’s happening in DeFi/Ethereum to be able to pursue high-impact opportunities with other teams.
- We will prioritize partners who are building products on top of Balancer over partnerships that use existing Balancer products. Although we’ll be using this general rule of thumb, this team is establishing frameworks to systematically evaluate the size of each opportunity.
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Frontend
- Over time, more focus should be given to tools that will help other teams and DAOs interact with our front-end (e.g. pool creation UI).
- The frontend team will also work on new UIs that showcase the power of primitives the Smart Contracts team creates, like linear pools and managed pools. If done right, this will spur adoption of these primitives by other teams, which will scale Balancer.
To summarize
Our job, as Balancer Labs, is to create the underlying tools (e.g. innovative pool types, comprehensive documentation, SDK) that allow other teams to develop products on top of Balancer Protocol. If we have ideas of products that could be built on Balancer we should formalize these ideas and add them to the grants committee list of requests for proposals.
Going forward, we should only develop new frontends or products in two situations:
- We believe no other teams would be interested or have enough incentives to create the product/frontend and it is essential for the success of Balancer Protocol. For example: boosted pools and staking frontends
- Other teams might have enough incentives and even a sustainable business model around a new product built on Balancer, but having an MVP built by BLabs that proves traction can be the trigger to actually getting them to build and focus on that opportunity. For example: LBPs and Copper
If you want to read more on why our focus of pursuing platform features instead of products matter, check out this article: market-protocol fit (thanks for sharing Kristen!).