Nearchos — The Search for Contributors

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What are subDAOs?

The idea of subDAOs is a growing trend. Defining a subDAO is tricky when we still haven’t fully grasped the entirety of what a DAO is itself. Kleomedes, being true to its core value of being visionary, is endeavoring to create a functioning definition to aid in their ever-evolving process of creating a truly decentralized, contributor-owned enterprise.

A subDAO is a purpose-built tool to accomplish a laser-focused goal.

There are many ways a subDAO can be structured. Depending on the goal, the subDAO may be a temporary group of people empowered to perform a specific function and then dissolve. The final deliverable of the subDAO might be a single-use function that, once it performs its purpose, is no longer active. Or the subDAO might create a fully autonomous and functioning organism that continues on beyond the original subDAO that started it!

Why make Nearchos a subDAO instead of starting a new DAO?

The proposal to launch Kleomedes’ first official subDAO has passed core approval and is now facing public approval from the community. When reviewing the proposal, one may find themselves asking: “Why?”

Fair Question.

Think of the subDAO as an incubation project. Not everything needs to start from scratch, and utilizing the Kleomedes Enterprise as a launchpad to spin up small, quick subDAOs to explore niche opportunities is a simple and easy way to speed up the process for contributors and enable them to get straight to work without having to reinvent the wheel just to try out an idea.

Leveraging the strength of the community, as well as the reach and influence of the Enterprise as a whole, subDAOs like Nearchos have a much stronger chance at success. Contributors can focus on the work that needs to be done for the specific task at hand, and leave the bulk of business development and organizational management to the Enterprise. This creates a scalable solution to contribution management that ensures contributors are still retaining proper ownership and compensation for their work.

What if Nearchos goes beyond Kleomedes?

The idea of subDAOs is that, while they are under a certain level of authority in terms of their obligations to Kleomedes for any work done under the Kleomedes brand, they are sovereign entities of their own that can also perform work for other clients completely unrelated to the host project. Revenue from collaborations that have nothing to do with Kleomedes, or the tooling/services built by Kleomedes, is owned by the contributors who put in the work to earn it. This is in exact alignment with the goals of contributor-ownership.

So, in theory, Nearchos and the contributors running it, could make money that doesn’t benefit $KLEO stakers. This is by design. $KLEO stakers will get appropriate compensation for all profits generated in collaboration with the Kleomedes Enterprise. Contributors always get first priority, however, and true contributor ownership requires this level of granular control over cash-flows to maintain proper incentive alignment.

This is, in fact, why Nearchos isn’t actually being added as an actual DAODAO subDAO. The current technical implementation of that feature does not grant the autonomy and control we wish to empower our subDAOs with. As we work on improving that technical aspect, we will continue forward with Nearchos as a standalone DAO in the DAODAO interface. Eventually we will incorporate it as a subDAO when the tooling features match our desired functionality.

The goal of $KLEO isn’t to be rent-seeking. This is a sure way to a slow death, as competition drives contributors away from the high-rent of working with Kleomedes. The Enterprise does share all profits — everything left after contributor compensation & OpEx are paid out — with $KLEO stakers. Contributors are also incentivized with $KLEO to align their interests with that of other $KLEO holders. The more $KLEO contributors receive, the more motivated they will be to perform work that generates revenue for $KLEO stakers. In order to attract the right kind of contributors, however, there needs to be more autonomy for the highest-quality contributions. Those putting in the work to build revenue-generating activities for the entire Enterprise outside of increased delegator count need to get proper compensation as well as ownership over what they create. After their products start generating revenue, the Kleomedes community can issue additional $KLEO rewards to incentivize the subDAO contributors to put their efforts towards work that further benefits Kleomedes in attracting more delegators.

What’s in it for Kleomedes?

The Enterprise of Kleomedes is a business designed to make profit.

If it isn’t obvious, this is the bread & butter of Kleomedes; Revenue Diversification as well as delegator growth. Running Validators is our main operation at this time, and will remain the core foundation of the Enterprise. Validating, however, will never be profitable enough on its own to support paying the contributors for the kind of work that is needed to achieve our grander goals. Validating will just be one arm of the Enterprise!

We already have a developer group that is working to build ecosystem tooling that could generate a revenue stream of its own. We’ve started plans for an NFT group that will have its own economy. The future Treasury group could expand beyond simply managing Kleomedes’ treasury, but actually making a fully functioning investment management team. We are also making plans to build an Akademy for enhancing our e-learning and onboarding functions. These, and the hundreds more ideas community members come up with over the years, are going to be the things that take Kleomedes from a small-time validator to a fully operational Enterprise — with multiple revenue streams and a completely decentralized collaborative environment that gets contributors put to work and paid a wage!

As the Enterprise grows and these ideas turn into subDAOs of their own, and we attract the kinds of contributors who can execute the goals of these subDAOs, it will only strengthen the Kleomedes community. Awareness will drive more delegations, which will increase $KLEO value & rev share, which will enable more $KLEO incentive expenditure to motivate these high quality contributors to build more things for Kleomedes to further the goals of the DAO. The flywheel spins on!

Nearchos is meant to serve as a trailblazer to show other community members how they can step up and take ownership of an idea and get it sponsored by Kleomedes to help get it off the ground. Hopefully this will serve as a catalyst that will get others to follow along with their ideas of what could be built here at Kleomedes. With proper incentive alignment, we can maximize both Enterprise growth and contributor ownership, all while feeding $KLEO and setting it up for great bull market potential. In the meantime, we will continue to experiment with these models and work out the best ways to organize these structures to maximize incentive alignment with long term vision and goals.

Head over to DAODAO and get your vote in to approve this direction of activity!