FAQ from Office Hours 1/21/2024

General
1

Thanks @deltajuliet for compiling this!

  • Q: What type of legal entity are you considering?

    • A: We are currently evaluating a few different structures in regard to legal entity. Some of the community OS design will inform how we best approach from a legal, operational and financial perspective.

  • Q: What are ways we can improve our value prop for funders? Most critical Q for me: “For Funders: Gain exposure to emerging on-chain capital allocation systems.”

    • A: This is one of our biggest risks—being seen as a non-profit without a sustainable business model. To mitigate this, we focus on:
      • Services and Fees: Introducing service-based fees distributed back to builders and funders.
      • Category Creation - as we grow, education and deliver, we bake in mechanisms for allocation that deliver value back to both the builders and funders
        • Spot an Untapped Need – Identify unmet problems or gaps. (Onchain Capital Allocation)
        • Define the Category – Create and name the space.
        • Educate the Market – Teach why the category matters.
        • Own the Narrative – Be the voice and leader of the category.
        • Deliver Excellence – Provide a product that defines the category.
        • Build an Ecosystem – Foster partnerships and communities.
        • Leverage Network Effects – Make adoption valuable as more people join.
        • Capture First-Mover Advantage – Move fast to dominate early.
        • Create Barriers to Entry – Build defensibility with IP, scale, or loyalty.
        • Evolve Constantly – Stay relevant through innovation.
    • A2: Funders gain exposure to cutting-edge on-chain capital allocation systems. Our goal is to set a standard where returns (financial or otherwise) benefit both funders and builders, creating a feedback loop of value.

  • Q: Has Allo Capital been formerly spun out of Gitcoin? What was the process?

    • A: We have not! Keep an eye on the Gitcoin forum for the latest updates

  • Q: Purpose and desired outcomes feel like the most important considerations that inform DAO Design. Can you share more about the overarching purpose?

    • Purpose: Advance innovation in capital allocation.
    • Outcomes: Create measurable impact through effective resource distribution, ecosystem alignment, and sustainable growth.

  • Q: Is the goal of AlloDAO to fund R&D for innovation in allocation mechanisms, or is it broader than that? Is it looking for deals with profit on top on those?

    • A: The scope of AlloDAO extends beyond R&D. While R&D for allocation mechanisms is core, the DAO also seeks to identify high-impact opportunities, deploy capital strategically, and foster innovation within and beyond the Web3 ecosystem.

  • Q. How should we structure proposals that were being drafted previously in this new setup with Allo.Capital and Grant Labs?

    • A: While both organizations share a synergistic relationship, their objectives and structures are distinct.
      • Grant Experiments: Allo.Capital’s focus is on funding mechanisms and capital deployment strategies that align with its broader objectives, so proposals around piloting or iterating allocation mechanisms could be a great fit if they enhance this mission. That said, initiatives that tie back to Gitcoin grants will still play a vital role for the org. It’s worth reviewing which entity aligns most naturally with the intended impact of your experiment.
      • Tooling: Interoperability with Allo.Capital’s infrastructure is a key point here. If your tooling proposal strengthens or integrates with Allo’s protocol or ecosystem, that’s a good sign it’s a fit. For projects with a more general grants application, Gitcoin may still be the right home.
      • Research: Research that explores or supports modular funding strategies, ecosystem development, or other areas of innovation relevant to Allo.Capital is valuable. For broader insights into grants funding or Ethereum alignment, Gitcoin remains a powerful driver of those initiatives.
    • When in doubt, feel free to connect with @deltajuliet or Owocki—we both are spread across Gitcoin and Allo.Capital and can help ensure proposals land where they’ll have the most impact.

  • Q: How are you thinking of revenue from investments on software trickling DAO to the research part?

    • A: There should be revenue ideations on both our software and research pillars. In fact we have some ideas in the backlog.
      • Potential approaches include:
        • Revenue Sharing: A portion of software-generated revenue can fund research grants.
        • Earmarked Returns: Investment returns can be allocated to a dedicated research fund.
        • Collaborative Synergy: Research breakthroughs inform product development, creating a circular value loop.

  • Q: What Allo’s goals are for the DAO? asked by @vengist

    • highest level: we are building the capital allocation layer of the tokenized internet.
      • high(ish) level
        • accelerate the builders of funding infrastructure
        • bring funders to the table to fund them && produce a return for funders.
      • lower level, i think that what this means these are core functions
        • find the best builders
        • give them things that help them along their journey
        • gain upside in their builds, likely in the form of us funding them in return for a share of their revenue/tokens
        • bundle that up and sell it as ALLO - a basket of tokens that represent the capital allocation layer of the tokenized internet (which is a $trillion cateogry)

  • our value props for builders

    • help getting to PMF
    • funding
    • Distribution
    • introductions / social support.
    • (sometimes) education/research/intelligence about mechanism design

  • our value props for funders

    • this is a trillion $$ cateogry
    • we are creating the category, mapping it, finding the upside, and bundling up upside for you in 1 easy tokenomic structure

  • our value prop for the world:

    • we are trojan horsing positive sum games/regen/public goods funding in along the way

  • Q: What are the core functions and stakeholders of the desired machine? asked by @vengist

    • Funders
      • fund the builders
      • tell other funders about allo

  • Builders

    • Build funding infrastructure
    • Progress along a path of hypothesis => MVP => pilot => product market fit => scale => monetize (not necessarily linearly, but sometimes linearly)
    • Iterate along the way

  • ALLO DAO

    • Find/support builders
    • Find/support funders
    • Route funding to builders, route builders to funding
    • Create the category of onchain capital allocation. and elevate the highest upside builds, builders, opportunities

  • Q:What’s your process to give access to your available budget and what do you consider the parts of a good proposal?

    • There really isnt a process right now. What we look for is:
      • Viable mechanism which hits a need in market
      • Builders who ship fast, iterate.
      • Builders who listen to the market.
      • Competency in full stack: marketing, ux, frontend dev, smart contract dev, etc
      • Clear path to product market fit.
      • Isn’t afraid to take a % to support their ongoing operations (but also isn’t greedy in taking too much.
    • There might be more criteria… as we explore the design space we will discover more.
    • Its also kinda an “you know it when you see it” thing. I think that grant ships, 1hive conviction gardens, easyretropgf, deepfunding are all great exemplars. - OWOCKI

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