By Alejandro Ballesteros, Venture Investor, Decasonic
Culture and Web3: DAOs and Other Innovations
Dmitriy Berenzon, research partner at 1KX; Dylan Hunzeker, investor at Intrinsic Capital; Shiv Malik, Co-founder of Pool Data; and Sean Smyth, founder of PechaKucha held an insightful panel discussion on DAOs.
Defining a DAO
As Dmitriy alluded to, DAOs can be defined in many different ways. One of the broader definitions is defining a DAO as a group of people with a shared mission and shared bank account. Inherently this definition needs to be very broad because the use cases for DAOs are an endless list. Among some of the use cases that received the most interest from the panel members were Protocol DAOs, Collector DAOs, Investment DAOs, and Service DAOs.
Naturally, Dmitriy and Dylan spoke about some of the interesting subversions that Investment DAOs make on the traditional venture capital fund model, In Dylan’s own words:
“With multiparty digital asset management, you’re able to aggregate different sources of deal flow. DAOs do this naturally from the ground up and build bottom up. A scouting program is a good use case, because you can automate payouts.”
This model is almost the exact opposite of the traditional venture capital fund model, where several partners form a highly structured and hierarchical fund that requires a sizable minimum investment from LPs.
Aggregation of Expertise
A common theme explored in the panel was the aggregation of subject matter expertise that DAOs incentivize. As Dylan pointed out, one of the large innovations in the space, is that you can suddenly have investment DAOs that wouldn’t have existed thematically because there wouldn’t be enough LPs willing to make a high enough initial investment for very niche theses. Shiv summarized this aggregation of niche expertise very nicely:
“DAOs filter for all of the people with real passion and conviction.”
This aggregation is heavily related to the recent pattern of fractional work that we have seen grow within younger generations, separating the work from the entity itself naturally allows for fractional and highly flexible work in many different areas.
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