The contributor is the lifeblood of a DAO. The quality of the products launched, events held, and governance decisions made relies on the expertise, creativity, and engagement of the community. The ability to attract and retain talented contributors will be what dictates which DAOs become the most successful organizations in web3.
Today the issue that DAOs face is not the lack of interest, but rather the challenge in converting those interested individuals to consistent contributors to the DAO. DAO operators can learn from strategies honed by web2 operators to vie for contributors as demand for DAO contributions becomes more and more competitive.
The Oncoming War for Contributors
We’ve made significant progress in DAO tooling so that any community can quickly deploy and manage a DAO without deep technical skills. Tools such as Discord, Gnosis, Openlaw, and Snapshot allow a community to circumvent the LLC and spin up a new DAO in just hours. The figure below compiles some of the tools that abstract away the complexities of running and setting up a DAO.
The ease in starting a DAO means that there will be millions of DAOs for contributors to choose from. The permissionless nature of contributions means that it will be easier than ever for contributors to take their talents from one DAO to another. DAOs will inevitably be forced to compete fiercely for quality and consistent contributors.
Web2 has spent years perfecting customer acquisition, which DAOs can learn from as they grow their contributors. One useful framework is the Customer Acquisition Funnel from web2 enterprise sales.
Customer Acquisition Funnel
Enterprise software companies spend a large amount of resources obsessing over the marketing of their product to their potential customer, reducing the friction to complete the sale, creating an incredible experience for customers using the product, and retaining the customer.
This is commonly known as the customer acquisition funnel in enterprise software sales:
The customer acquisition funnel illustrates the stages that a potential customer goes through during the sales lifecycle.
Target: individual who is a target of the company’s marketing campaigns
Visitor: individual who has heard of the product and visits the company’s website to learn more
Lead: individual is interested in the product and has requested outreach for a conversation with the sales team
Paying Customer: individual who decides to buy the product
Promoter: individual who is delighted by their experience using the product and actively promotes the product to others
Tracking the number of customers at each stage of the customer acquisition funnel and their conversion rates across the stages is key to driving operations for the sales and marketing teams.
Contributor Acquisition Funnel
To win the war for active community members, DAOs need to think of the contributor much like software companies think of the customer. For DAOs operators, the Contributor Acquisition Funnel is a way to keep a pulse on their ability to attract contributors:
Stranger: individual who is unaware of the DAO
Lurker: individual who has joined the discord, passively taking in the conversations in the discord
Participant: individual who is actively asking questions and participating in conversation within the discord. They are making an effort to understand the roadmap, key initiatives and trying to gain the context that will allow them to contribute to drive those initiatives forward.
Casual contributor: individual who has made a contribution to a project that does not require deep context, such as taking notes at a town hall, greeting and orienting new participants in the discord
Active contributor: individual who has participated in a larger work stream focused on a strategic goal for the DAO. The Active Contributor is a consistent member of the community that participates on larger more complex projects and takes part in governance of the DAO.
The DAO operator’s dashboard should have contributor metrics such as contributor acquisition costs, number of contributions per contributor, the conversion rates between each phase in the funnel, front and center. Like an enterprise sales team, the DAO’s core teams should execute against these metrics and be held accountable for their performance.
Small Autonomous Teams Accountable for Outcomes
The beauty of the DAO is the ability to draw on the creativity from the fringes of the community, but organization and accountability is necessary to unleash the power of the community.
Growing the contributor community is a complicated undertaking. DAOs can use the Contributor Acquisition Funnel Framework to segment the overall mandate into smaller focus areas that can be delegated to more nimble autonomous teams. In most DAOs today, the community manager likely takes on multiple roles: marketing, onboarding, community building, etc. Instead, DAO can assign responsibility to smaller guilds or subDAOs that are empowered to make decisions within their respective lanes.
DAOs can also quantify the impact a team has on the contributor community and evaluate whether the right teams are working on the right projects. In grant proposals, teams can be required to be explicit about what metrics they want to improve for the DAO and how they are going to do it. Here is an example of how DAO teams can be transparent about the value of their work so that it's straightforward for the community to evaluate their outcomes.
Quantifying the impact of teams also paves the way for DAO to have more nuanced conversations around compensation. The numbers provide the backing for DAOs to justify rewarding community building appropriately and attract the best contributors in the ecosystem.
In the web2 world a company fights for customers. In the web3 world DAOs fight for active contributors. DAO operators who use the Contributor Acquisition Funnel framework to structure small autonomous teams that are evaluated with measurable outcomes will have a competitive advantage in the fight for active contributors.
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