Grants Program Sprint #1 Key Takeaways

#1

Grants Program Sprint #1 is closing as applications are analysed and finalists chosen. Here are the Grants Program Sprint #1 takeaways and learnings, shared with the intention of maintaining full transparency with the DAO and to progress in our decision-making process in the next sprints. Please expect another forum post where Grants Committee provides a recap with more data and details on this sprint.

1. Grant Proposals should have structure and contain the following info:

  • Team experience supported with relevant information, links on previous projects etc.

  • Measurable Outcomes/Metrics of success:

    • Based on the proposal and project scope metrics can be different. They should be discussed upfront and ideally set in the agreement.
    • Transparency reports presented to the DAO and the community are a must for every milestone. These reports can significantly influence the decision to continue with the grant.
    • In addition to the grants form sent out at the start of every sprint, each project should submit a well-detailed proposal containing:
      1. Full project description & how it impacts growth of RARI Ecosystem
      2. Funding request & it’s alignment to the scope of the project and actual project need

2. The grants are intended to support the ecosystem growth. It translates into on-chain user engagement for RARI Chain and active usage of Rarible API. Committee gave a priority to projects who have clarity on how they can make a positive impact on these parameters.

  • A bunch of applications that at first glance seemed interesting and relevant were unclear about how they can drive us new users. Priority is given to projects with active user base/community and proven product-to-market fit (rare combination nowadays, but).

  • Asking for incentives along with development grant from treasury to support project [in most cases] means double-spending. Foundation then pays both for integration and for user acquisition (go-to-market). It should be either or: DAO and Foundation either help a project with development costs but the project can guarantee to provide new users, or the project covers development costs themselves and DAO/Foundation helps with go-to-market execution.

  • Projects that come as an infrastructure (creator tooling, for example) should have go-to-market strategy to launch on RARI Chain. Giving a grant to an infrastructure project without knowing who will use this infrastructure has high chances of not being used.

    • Example: A platform for loyalty programs applied for a grant to build on RARI Chain. They tick all the boxes except for this one: not having a client who can directly use it. The recommendation was to bring a client along with application to improve chances of getting funding for this launch.

3. We can realistically support up to 5-6 projects per sprint, allowing us to sustainably lead these initiatives and track their KPIs effectively.

4. Grant requirement is to use Rarible API, a paid service. Some applicants are well-established projects and require Business grade of Rarible API that costs ~$1,000/month. An additional hidden cost for them is switching part of their infrastructure to Rarible and altering arrangements with their previous data indexing provider, as these companies typically have existing data indexing in place. We should consider subsidizing API for a period of 6 months to 1 year to encourage them to use Rarible API service.

5. Lock-up period. During the process, we’ve learnt that the lockup period that was set to 6 months after every milestone is a feature that applicants hesitate a lot. We issued a vote on Tally to make changes to that rule. As a result the Committee was allowed to:

  • Remove the lock-up period for $RARI after full project delivery.
  • Decide on a case-by-case basis if $RARI tokens should be locked until project completion and hitting the last milestone.

6. Operational process:

  • The Grants Committee consists of 4 members (2 from Foundation/2 from the DAO) with one ‘Operations Lead’ who sits on top of the Committee and leads initiatives and key processes, such as interviewing teams, negotiating the terms of the deal between applicant and Grant Committee, managing KYC and agreements, issuing proposals to DAO if it’s needed to adjust the process, leads team calls, arranges marketing activities, manages relationships with candidates.
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RARI DAO Weekly Highlights - July 22-28, 2024
#2

Great report, thank you! And I love that it includes the GC team’s thinking of how applicants will be measured, tracked and qualifications required.

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#3

Thanks for sharing your thoughts. It’s great that you focus on projects that have the best chances to foster ecosystem growth and on-chain user engagement.

I support the idea to subsidize Rarible API for grants projects.

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#4

Thanks for this reflection on how things went and how they might be improved. I’d like to add some considerations here for the future based on the recent RRC-29.

I appreciate the inclusion of KPIs and trying to better define the grants council responsibilities. However, this could benefit from some more concrete specifications for the KPIs. For example the grant committee “communicating regularly” could be defined as producing a report once per month. Something which the Grants Council members can be objectively assessed against when looking back at previous funding cycles.

In addition, my view is that grants should focus on cost benefit to the protocol and a KPI which makes a lot of sense to me would be something along the lines of TVL increase per dollar spent, or fees earned per dollar spent, or users per dollar spent, or something along those lines.

Current KPIs do not seem to have a focus on the outcomes of the grants process, and at the end of the day the grants need to be bringing value to the protocol otherwise alternative ways of spending the treasury should be explored like liquidity mining and token incentives to users.

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