GRTiQ Podcast: 68 Spencer Graham

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Spencer Graham (00:00:21):

Yes. Basically, I would say 90% of the data that you see if you go into the DAOHaus app is coming from The Graph.

Nick (00:00:30):

Welcome to the GRTiQ Podcast. Today, I’m speaking with Spencer Graham, Product Manager at DAOHaus, a widely used solution throughout the DAO universe. DAOHaus calls itself a no-code platform, where you can create and manage your own DAO with the mission to foster a diverse and open economy of transparent cooperation.

(00:01:19):

My conversation with Spencer is incredibly insightful. We discuss a wide range of topics, including how blockchain will disrupt the healthcare industry, the origins of DAOs, an exploration of what a DAO is and what it isn’t, what DAOs can achieve that other organizational structures cannot, and how DAOHaus uses The Graph as key infrastructure. We started the conversation by talking about Spencer’s educational background at the intersection of psychology and economics.

Spencer Graham (00:01:47):

So my educational background, so I started in college. I had two majors. One was economics and one was psychology. I actually started out with economics because I had taken an econ class in high school and learned that I really loved that way of thinking, but I also started to become … In college, I had this feeling that I would enjoy psychology and I turned out to be very right about that. One of the things I loved most about that combination was the combination. I got really into behavioral economics and rethinking some of the foundational assumptions of classical economics with some more nuance that psychology introduced.

(00:02:36):

Some of the research that underpins a lot of the behavior or, at the time, a lot of the behavioral economics industry has been called into question more recently with the big experiment replication crisis, but nonetheless, I think a lot of the way thinking that I learned and practiced has been foundational for me in all the stuff I’ve done after that.

Nick (00:03:00):

Well, I’m familiar with behavioral economics. I think some of that school of thought came out of Chicago, which is where you’re joining me from if I’m not mistaken, but that combination is really incredible, the economics and psychology. So what is it about that combo that lit a fire in your mind and said, “Hey, this is even more interesting than just studying economics”?

Spencer Graham (00:03:21):

I think for me, and I might be using some of the language and perspective that I have learned since then, but if I can retrospectively answer that almost, I think for me was I have always had this strong appreciation for and focus on the structure of the world and how the world works, but that structure, an understanding of that is incomplete without an understanding of how humans work. So a lot of the structure that we have, especially on the social side, is an emergent property of the way of human brains, basically, and the way human brains evolve to work internally to itself and also then in conjunction with other human brains and other people.

(00:04:06):

So melding this foundational, structural interest with maybe a layer on top of that almost and then understanding how those two things are interact, in retrospect, I think, is the reason that was so attractive to me, and it continues to be. If I look back at my cross, everything I’ve done since then, there’s the clear through line back to that basic concept.

Nick (00:04:30):

Well, Spencer, we’re talking today because you’re at DAOHaus and we’re going to have a lot more to say about economics and human behavior when we talk more about DAOs. Before we get there, what happened after you graduate from college and what’s the path you took into web3 and crypto?

Spencer Graham (00:04:45):

So I graduated from college in a, let’s call it a bumpy period in the economy. So I will skip some of that messiness, but where I really started my career was I actually started out in advertising. I found this role in advertising called an account planner or the thing that that role did was account planning, which was basically trying to figure out what the client, what their audience, the people they were trying to market to or advertise to wanted or cared about or what was important to them, and then figuring out a way to talk about or communicate with them and bridge the gap between their needs and the solution that the brand or the company was advertising.

(00:05:35):

That made a ton of sense to me, a lot of alignment with or used a lot of the concepts that I had learned and become enamored with in college. So I moved in that direction. There continued to be some bumpiness in the market and I ended up not being able to continue down that path, but I ended up switching into the marketing research industry, so not too far away from where I started. I ended up at a company that did consulting for other companies, essentially designing and writing and implementing and then analyzing the results of quantitative surveys.

(00:06:11):

So if you’ve ever gotten an email from some company that’s like, “Hey, take this survey. It’ll take you five to 10 minutes,” and then you answer a bunch of questions and there’s scales that you’re responding to, that’s the kind of work that I was doing. Those surveys basically were designed to gather quantitative data that we would then do an analytics on or analysis of different kinds. I got really into crafting those questions in a way that we could get as clean as possible of an interpretation of the results and the responses, which called back to my time in psychology and designing and running experiments.

(00:06:50):

Then the analysis side, the data analysis, learning or building on my background in statistics, but then thinking also through the business problems that analysis and interpretation of the results would speak to. So I ended up doing that for six years, but there was a point at which in that six years that I started becoming much more interested not in the nitty-gritty of designing a good survey, but in the business problems that we were actually being hired to help support or provide some insight into.

(00:07:26):

I started to get a little bit frustrated that in this consulting company, I didn’t really have any kind of control or insight into what happened after we handed off the results of our research. I started thinking about, “What is that like? What is that world? How can I maybe participate in that?” I was doing a lot of searching and figuring out what that might be, and I came across product management, more on the tech side of things. I realized pretty quickly that product management was the builder version of account planning, account planning being the communications of the marketing version. Product management was figuring out what are the problems that exist for some set of people and what can we build to actually solve that problem and how do we do that best.

(00:08:12):

That was really attractive to me. Dove head first in that concept. Got really into lean startup principles, which also calls back to this idea of iteration and experimentation. I ended up in healthcare, and it was in healthcare that I started to realize or get a deeper appreciation for how much and why the healthcare system, at least in the United States is so terrible and it’s so backwards. That, actually, and I might be getting a little bit ahead of myself here in terms of what we’re talking about, but that was actually a big catalyst for me going really, really deep on understanding Ethereum and smart contracts and the user or individual person autonomy over their own data, and it was that that really pushed me into web3 really deeply.

Nick (00:09:06):

So let’s take a minute here and spend some time on that. That’s really interesting. So I love the career path because it’s diverse and so many guests of the podcast have had diverse backgrounds, which is a great signal to listeners that it really doesn’t matter where you came from. You can find a place in crypto and web3, but healthcare is interesting to me because there was some signal there, like you said, that said, “Hey, Ethereum, blockchain, there is value here in the context of healthcare.” So can you connect those dots for me? What was it that was that aha moment for you?

Spencer Graham (00:09:39):

There’s a couple and they very tied together, but I think it’s helpful to understand them a little bit separately as well. So the first thing is that the product that I was working on was, in retrospect, not a great product. It was not the most exciting thing to be working on. It did teach me a lot about the mechanics of how the healthcare system works. So that product was focused on helping hospitals and other healthcare providers essentially audit the payments that they would receive from insurance companies based on the claims that would get sent to those insurance companies. Those payments are, at least, ideally governed by these extremely complicated contracts or agreements between the providers and the insurance companies. They’re complicated because the human body is complicated and there’s many different ways to try to simplify how complicated the human body is and the treatments that are needed to serve the human body.

(00:10:39):

So there’s 17 different methods for simplifying, which means the whole thing is even more complex, which makes it incredibly difficult to determine for a given patient, for a given service that they received what the actual cost of that is and what the insurance company actually owes. Both the hospitals and providers and the insurance companies have their own implementation of that same logic.

(00:11:04):

So there’s plenty of opportunity for those implementations to diverge, and they often do diverge. It’s very, very difficult to tell when they’re diverging. So it’s very high value thing for hospitals to pay a boatload of money for a product where they can dump all their information into and then get some answer back like, “Yes, this insurance company paid me correctly,” or, “No, they denied me incorrectly,” or, “They underpaid. They paid some amount, but not as much as they should have.”

(00:11:35):

So our product was very valuable, even if it was incredibly challenging to use and a headache on the technical side, but I started thinking as I was getting a little bit into Ethereum and started thinking about the existence of smart contracts like, “What if instead of having two different implementations of the same logic, we just had one implementation that both parties could trust and then data inputs flowed into that from both sides, and then that spit out an output that both parties trusted. Then, oh, by the way, what if the payment was automatic and embedded inside of the whole thing?” It just felt so much better than the existing system, and I had this inkling that I would pitch this to my boss and we would pivot our company maybe a little bit and go explore that path.

(00:12:28):

I did, but I struggled very mightily to explain why that was actually valuable because I didn’t have the language yet. I realized if I wanted to really do this, I needed to learn a lot more. So that’s where I dove into learning, understanding smart contracts more. I started to understand what gas was and why that was relevant, what are some of the trade-offs associated with smart contracts. Then I got into this big privacy bent, trying to figure out where in web3, where in blockchains are people thinking about privacy because I realized that in healthcare, you can’t just put everything on a public blockchain. That’s very, very, very sensitive information, but it was actually that concept that started getting me excited about the idea of web3 in general as we know it today, individual autonomy, control over your own data, ability to reveal your data when you would like to, but keep it private when you otherwise would.

(00:13:25):

It struck me that one of the problems with the healthcare system is that all of the data is siloed inside of these different organizations, which is one of the problems that healthcare’s insurance companies have in communicating, but also between providers. They don’t really do a great job. They’re not incentivized to share that data with each other, at least inherently or naturally, which means that they actually are incentivized to put up barriers to sharing that data, which means that they’re actually incentivized to try to keep you within their own system, and it creates the conditions for hospitals to get bigger and bigger and bigger and consolidate and consolidate and consolidate both to do that, but then also to have better and better negotiating power with insurance companies on the other side. So just all these incentives basically create all these backwards value flows, and all of that comes back on the patient as not getting served in the way that they need to be served. So all of that drove me to, “Let’s create a better system.”

Nick (00:14:31):

So I’ve had a couple guests on the podcast recently, Tushar over at Multicoin, I had Cathy Barrera on at Prysm Group, and I did ask this question about which industries blockchain will disrupt. In the context of healthcare, it’s been mixed, but, man, this is such a granular perspective here, so detailed. It sounds like you’re pretty bullish on blockchain being able to come in and disrupt some of existing issues in healthcare. Is that true?

Spencer Graham (00:14:58):

If I may register a prediction that has no timeline, so it’s not a real prediction, but if I may register a prediction, I expect that the healthcare industry, as we know it, will be completely different and it’ll be completely transformed by what we have come to know as web3 technologies, blockchains, self-sovereign data, all of that entire suite of technologies. It will totally change. It’ll explode the existing structure that exists because it will totally change the relationship that patients have to the data associated with treatment that they get, which will totally change the relationships that they have with their providers, which will totally change those providers relationships, which will totally change the relationship between providers and insurance companies.

(00:15:45):

It’s going to take a long time to happen because, one, we have to build the tools to actually enable patients to control that data in a way that actually maintains privacy. There’s also a lot of cultural learning and technical learning that needs to happen for individual patients to actually have sovereign control over that data. Not everybody knows how to use a public-private key pair, so there needs to be solutions in that direction, but I feel pretty confident that we’re going to get there eventually. It’s just a matter of time and a matter of what technologies get built up and when.

Nick (00:16:19):

I love the perspective, and I appreciate you walking us through that. Let’s shift our attention now to why we’re talking today, which is DAOHaus. What can you tell listeners who aren’t familiar with what DAOHaus is, what it is, and how it got started?

Spencer Graham (00:16:33):

So DAOHaus, there’s probably 10 different ways to describe what DAOHaus is. I think one way is to talk about the history of DAOHaus. So the history of DAOHaus really begins with the introduction of the first MolochDAO. Some people are familiar with MolochDAO, but a lot of people are not. Maybe they’ve heard the name and they don’t really know what exactly it is. It’s got its funny demonic sounding name, which is somewhat intentional. Basically, Moloch is the demon of or we can think about it as the demon of human coordination failure. The MolochDAO was an attempt, starting in I believe it was early 2019, to see if we could come up with a way that slayed Moloch or destroyed Moloch. The people who were involved in that effort decided to name that thing ironically after the thing that they were trying to destroy.

(00:17:30):

A MolochDAO, you can think about it as one of the many DAO frameworks that exists now, basically a smart contract pattern that you can take and fork and implement on your own for your own DAO. There’s a lot of features of a MolochDAO, but you can think of it almost like a multisig with some superpowers or some extra stuff that really unpacks a lot of power and a lot of ability to enhance the coordination between the members of that DAO or the people who are on the multisig as the parallel example.

(00:18:07):

So a MolochDAO is permissioned. So you have to create a proposal to join the MolochDAO in order to become a member. Governance power, power within the DAO, is non-transferable. So the only way to get governance power is to become a member or to request from the DAO additional shares, shares being the unit of governance power. Different members can have different number of shares, so they can have different amounts of governance power. Then also, those shares represent or serve as economic stake in the assets within the treasury.

(00:18:46):

The reason all of that’s important is because it’s, for the first time, enabled even a smallish group of people to come together and put their funds, their own funds into a collective pool, maintain some degree of rights over their portion of those funds, but also have those funds be made available for shared spending or shared objectives. That really unlocked something. There very quickly became a lot of other DAOs starting to use that MolochDAO framework, a number of different forks of the original MolochDAO, and there became a need for a way to interact without code or even create one of these DAOs without code in a relatively easy way.

(00:19:35):

So that’s where DAOHaus was born. It actually first started as something called PockeMol, which was short for PocketMoloch. So it basically started as a mobile application, basically allowing you to create proposals and vote on proposals and see the treasury for a MolochDAO, and then DAOHaus was the introduction of the ability to create a MolochDAO or summon a MolochDAO as we call it from scratch without any code. So that’s how DAOHaus started. So it ended up becoming today as really a home for communities who are purpose-driven and community-centric and wanting to drive after a shared or collective purpose while also respecting and incredibly supporting the individual sovereignty or the individual autonomy of everybody within the community. So that is really what we’re building DAOHaus to and have been building DAOHaus to enable a very large scale or for as many communities, as many groups of humans as possible.

Nick (00:20:39):

That makes a lot of sense. So in the context of DAO history, MolochDAO comes up all the time. I’m new to DAO and certainly very new to DAO history. Was this the first DAO? Was this first important DAO? How should we place MolochDAO? It comes up all the time.

Spencer Graham (00:20:55):

It is certainly not the first DAO. The first DAO, at least that most people are aware of or that I’m aware of, was The DAO, famously got a ton of traction and then infamously exploded after it was hacked, which led to the split between Ethereum and Ethereum Classic, but also, it created what people have called a DAO winter, where people were very hesitant to try to experiment with this idea because of the issues that The DAO ran into. There were other projects that were started before MolochDAO, Aragon Colony, I think, maybe DAOstack. The timing on those I’m actually a little bit fuzzy on, but it was really the MolochDAO, the first one that reignited people’s imaginations and hope for what DAOs could do. So it was the first of a new wave of DAOs that have since unleashed this huge amount of momentum and explosion of DAO tools and other DAOs and experimentation with what DAOs can do that we see today.

Nick (00:23:15):

Based on your description of what DAOHaus does and tying it back to MolochDAO, I have a great idea of why it was born and what it intends to do. Tell us about the team. So what was your involvement in those early days? Were you a member of MolochDAO with other partners and saw this opportunity or did you all see a problem in the market generally just form to address it?

Spencer Graham (00:23:37):

So at that time, I was just an observer. So I saw the original MolochDAO and I got very interested in it. I did not have the 100 Eth required to contribute to that and support the grants that it was giving, but I was an enthusiastic observer, and also an observer of some of those forks that started to happen from it, but I was not yet a participant. So I was not one of the founding members of DAOHaus. There were a few founders and they were really working on DAOHaus primarily as a project on the side, just something they were building for the good of the communities that they were a part of, for themselves almost as part of those communities that were needing a way to interact with those DAO smart contracts they were using.

(00:24:24):

It was not until later, maybe fall of 2020, that I personally got involved and that was right around the time when the contributors to DAO and I started thinking about DAOHaus as a thing that could be really valuable for a lot of people and leveling it up from this side project to this more of a real full project that it would eventually be able to sustain itself. So I got pulled in. I had been working within RaidGuild for a handful of months and gotten a taste of DAOs because of the magical experience that you can have inside of a DAO that gives you sovereignty but also connects you with lots of people and creates incentives for you to experiment and try things and take risks with them.

(00:25:08):

So I got very excited about the prospect to help build tools that could allow other people to have the same experience that I had had in RaidGuild. So that’s when I got involved. So in fall of 2020, and I ended up at that point or shortly after quitting my product manager job in that healthcare position and just starting to work in DAOs full-time and slowly ramped up the degree to which that was focused on DAOHaus.

Nick (00:25:39):

So when you tell friends and family, “Hey, I’m heading for a career into crypto and I’m going to work on these things called DAOs,” do you get a bunch of blank stares, people trying to figure out what you’re even talking about?

Spencer Graham (00:25:50):

Let’s just say I have experiment with many different ways of explaining what it is that I do and why I think that’s important. I don’t think I’ve landed on one that works really well yet. I usually start out by asking some questions to try to figure out how familiar the person I’m talking to is with anything in this space like, “Have you heard of Bitcoin?” is the first one I ask, and then from there, I try to tailor my response. I’m still working on it. Let’s just say that.

Nick (00:26:20):

Well, let’s spend a minute here on these definitional elements that are tricky. I want to ask you how you describe or define what a DAO is then.

Spencer Graham (00:26:31):

Some people regret asking me that question because it’s one of the things I’ve spent a lot of time on and I have potentially a very long-winded answer. I’ve been working on shortening that a bit. I am pretty opinionated about what a DAO is. What I’m less opinionated on is whether being a DAO is required. I tried hard to make it clear that when I say something that I see that I don’t think is a DAO, when I say that’s it’s not a DAO, that’s not necessarily a value judgment of that thing itself. It is more a definitional description of what I am seeing. The reason that I feel like it’s important to have clarity about that is because it’s important to understand and recognize what it is that DAOs can do uniquely relative or compared to other types of organizations that we’ve seen in the past. There’s a ton of those organizations out there. There’s many different types, including ones that are very DAO-like, holacracy, sociocracy, co-ops. All of these have a lot of values that they share with the people in the DAO space of individual employee or contributor autonomy, bottoms up rather than top down.

(00:27:49):

So I think it’s really important to recognize that those exist, but then also ask, what it is that DAOs specifically do that is unique? What can DAOs do that unlocks something new that we’ve never seen before? If we have an organization that is on-chain that is basically just one of those other organizations, we could call it an on-chain version of those other organizations and that’s perfectly great, but what is it that DAOs do you uniquely?

(00:28:15):

What I have come to understand that DAOs do uniquely is it’s really two big things. One is that they are capable of distributing executive power, so the power to execute actions with the shared resource of the community, of the organization, so the treasury, basically. The power to execute actions is distributed across all members of that community. That is something that is just not possible. We could simulate it with legal contracts and that’s what a co-op is, but just there’s some fundamental challenges or separations that still occur where in a co-op you end up having a few people still in control of the co-op’s bank account. Whereas in a DAO, everybody is in control of the DAO’s treasury.

(00:29:11):

Now, certain people may be delegated to take certain actions using the treasury, but ultimately in a DAO, everybody remains in control, has executive power over the treasury. So that’s the big, big thing number one, and then big thing number two is that information about the DAO’s crucial operations remains or is fully transparent and accessible to everybody, at least within that community. Those two things are just, I think, quite literally impossible without blockchains, without smart contracts.

Nick (00:29:49):

I love that explanation, Spencer. I think it’s critical, and I have a lot more questions for you about this distinction because it’s certainly in vogue right now for people to join and start at DAO and the distinction gets blurry. Before we get there, you and I met because I’m a Graph Advocate and The Graph Advocate. DAO was recently launched and Graph Advocate DAO uses DAOHaus. So as a user, had a great experience and a lot of the pain points of trying to understand how a DAO works and participate in a DAO was certainly for me resolved by using DAOHaus. When it comes to letting listeners know how DAOHaus makes money, the number of DAOs that DAOHaus works with and some of those types of things, what can you share?

Spencer Graham (00:30:32):

So both of those things are, in a sense, things we’re working on. We just candidly could do a lot better job in terms of our own analytics of how many DAOs are using DAOHaus in an active way. We know that there’s about 2,000, maybe 2,500 DAOs that have been created on various main nets on DAOHaus in the last year or maybe two. Certainly, not all of those are active. Some of those might have just been like test DAOs that somebody was playing with, et cetera, et cetera. What I can say is that it’s definitely in the hundreds of DAOs. Some of those DAOs may be active, but maybe only a few people, but we still consider that a DAO.

(00:31:19):

We’re probably going to be spending some cycles soon getting a more specific understanding of that in part because one of the other things that we’re doing is trying to work out how DAOHaus will be sustainable over time or self-sustaining over time. We have done a couple, what we could call them community led fundraisers using our own technologies to support those. So we are supporting ourselves and in building DAOHaus based on the funds that we have all contributed, but that is certainly not our long-term vision to be requiring endless funding from the community. Instead, what we hope to see is that DAOHaus can be a self-sustaining community, a self-sustaining project that is owned and controlled by the community at large.

(00:32:12):

What we’re trying to work out is exactly what that looks like. Also, one of the things that we are trying to figure out is what is the right model or what are the right models for that that also align with our values. We feel pretty strongly that DAOHaus and DAO technology, basic coordination technology, should be a public good or as close to a public good as possible. It should be open source. It should be at least free to start using. It should be something that doesn’t lock you into a particular interface. A lot of the values that web3 has we feel very strongly.

(00:32:51):

So what we’re trying to do is pick from a number of possibilities for how value flows back to or a cruise to DAOHaus itself to sustain itself in a way that aligns with or comports with our values and some of the things that we believe. One of the challenges that we’re facing is that there’s a lot of different possibilities, and we could optimize the way that we build for any of them, where just very transparently, what we’re going through right now is a process of figuring out what we think is going to be best both for us and the community and all of our stakeholders, and then we’ll potentially adjust how we’re doing things accordingly.

(00:33:32):

One of the things that we really hope happens though is that as lots and lots of other tools and projects and communities build on the DAOHaus infrastructure in ways that create mutual value, and then we hope that value flows both from us to them, but also from those people to us so that we can continue to build for as many people as possible or as many people as are getting value out of what we’re building.

Nick (00:33:58):

So if listeners want to get involved with DAOHaus, is the team hiring? Are there ways for listeners to participate?

Spencer Graham (00:34:05):

Absolutely. We don’t necessarily consider it hiring, but there are lots of opportunities to contribute to DAOHaus. We ourselves are organized as a DAO. We practice everything that we preach and we dogfood everything. We try to push the limit of how we use our tools, how they can be used, what DAOs can be and what DAOs can do. So if that is interesting to you, the best way to get involved or to find out more is to, well, you can contact me for one or you can come into our Discord server. There’s a couple channels dedicated to contributors and we have starting to get a better process for how to bring those people who are interested into the fold. We have lots of opportunities for people to contribute and lots of needs for more technical roles, developers, designers, product people to communications, content, what have you. There’s needs and room for pretty much any skills or talents you can think of.

Nick (00:35:06):

I want to give listeners a rare look behind the curtain because, like I said, I’m a user of DAOHaus by virtue of being in Graph Advocates DAO. So I’ve had the hands-on experience of seeing how it’s set up and interacting with this interface. To make it really simple, you go to DAOHaus, you launch the app, you connect your wallet, and then you’re able to make votes and different things through this technology that’s reflected in the DAO, a huge oversimplification, but the thing I want to inform listeners about, Spencer, is you can choose the token that the DAO distributes to members or the token that’s used to vote. Can you even choose the blockchain upon which all of this is housed? There’s a lot of things that you can interact here in change. Walk users through, I guess, those elements and how easy it is through DAOHaus.

Spencer Graham (00:35:56):

So DAOHaus makes it very easy. What is less easy, and I think what we can do a lot better job of helping DAOs do is making some of these decisions about how to configure their community, their DAO, and how exactly they’re using DAOHaus. Actually, a lot of the time that I spend is with communities or founders of communities that are interested in leveling up their community to using a DAO. I spend a lot of time thinking through some of these nuances with them. Some of those nuances are which blockchain, which network should they call their first home. There’s a lot of trade-offs there. Being on Ethereum main net can be quite expensive with the gas, but you also get access to all these other protocols, and there much more mature ecosystem that exists there or you could be on something like Gnosis Chain or Optimism or Polygon or Celo or Arbitrum and have some degree of lower gas fees, but maybe less access to a mature diverse ecosystem of other apps and protocols to use. So the ecosystem is this awkward place where there’s some strange trade offs that you need to make.

(00:37:09):

So that’s one big thing, but then another big thing is how to structure the initial power within your community. Do you give the two founders way more power than everybody else or do you intentionally try to give away some of that power? I would advocate for the latter, but they’re difficult questions. Similarly, should you start your DAO with a token and have it be something that can power certain really fascinating incentives from the start or do you want to stay tokenless and just use the share-based governance power model that DAOHaus is focused on and stay out of the big wide financial world from the start and maybe gradually, gradually open up over time, and what does that look like.

(00:38:00):

There’s a lot of really nuanced questions that everybody’s exploring altogether right now. So there’s not … One thing I think we should work on is, can we create templates in not just how the app looks, but also how everything is structured based on different needs or different things? We’re starting to get there a little bit more, but everything is changing so quickly that it would probably be premature to etch those in stone right now.

Nick (00:38:59):

So I think a natural followup then is for listeners who are thinking about launching a DAO or maybe they already belong to a DAO and the bells are going off, they need something like DAOHaus, what’s the best way to get started?

Spencer Graham (00:39:11):

Best way to get started is to go to the DAOHaus website. There’s lots of documentation and resources on DAOHaus.club where you can get started learning more about what it would mean. At this phase of a lot of communities of life cycles, there are a lot of nuanced decisions that they may need to make or they might want help making. So we at DAOHaus are also completely available to help think through those things and also to think through how the suite of tools that DAOHaus offers can be used to solve some of communities problems. We’ll also be honest, if DAOHaus is not the right fit, we’re not going to push it on you. So oftentimes, we actually serve almost a DAO Consulting role for certain communities and help them figure out what tools would actually make sense for them and what they need to do. So come in into our Discord and just get in touch with us, ask us, and we’ll be happy to help.

Nick (00:40:09):

As somebody who is totally new to DAOs, never belonged to a DAO and then all suddenly I’m in Graph Advocates DAO, your training and the team there and setup, handholding, getting the DAO launched on DAOHaus was incredibly insightful and helpful. I want to ask you, with that hands-on approach almost acting like a consultant, in addition to DAOHaus, what other infrastructure or what other best practices do DAOs need to have in place to have a chance at really achieving what they set out to accomplish?

Spencer Graham (00:40:42):

DAOHaus is certainly not the only tool that DAOs will ever need. In fact, we very much don’t want to be that, and we certainly don’t want to build all those tools. We recognize that every DAO, just like every company, has a million little problems that they may share with other DAOs, but the combination is unique to them. So it’s really crucial that DAOs are able to access all of those different tools and, basically, all the solutions to their own little idiosyncratic problems even while using something that is fairly cohesive or creates a cohesive user experience.

(00:41:24):

So there’s a million of those tools. One that I think pairs particularly well with DAOHaus and its non-transferable share-based governance power model is Coordinape. Coordinape, one way to think about it, is a way of allowing the members of a DAO, the members of a community to intersubjectively evaluate each other and essentially give each other some degree of reputation points. So the result of a Coordinape epoch might be a distribution of those points. The way that works really nicely with a DAOHaus DAO is you can take that result and then allow or empower the members of the DAO to earn additional shares, additional governance power based on the allocation of points they received from their peers. So it almost acts like an iterative reputation model that then gets converted into governance power, and governance power then becomes a reflection of the bottom up reputation that is measured on a continuous basis within the DAO.

(00:42:35):

That I think is a really, really powerful model for ensuring that governance power goes to the people who the community respects the most, but is also changing in fluid over time. It doesn’t get entrenched within a certain set of people who may or may not be active on an ongoing basis.

Nick (00:42:55):

Going back to something you said earlier then, there’s a wide range of DAOs, types of DAOs, and you have a strong opinion, a strong vision for what qualifies as a DAO, and I like it. I’m attracted to what you said earlier as you explored what it is that you think a DAO properly is. What advice do you have for listeners who want to make sure they’re there, that they check that box of being an actual DAO structured and operating in a way that a DAO should? What are the three to five things that every DAO in that category must be doing or should be looking at to ensure they’re doing it?

Spencer Graham (00:43:35):

Something I’ve been thinking about recently is this concept of progressive permissionless, which is a comparison or an alternative to the progressive decentralization playbook, which a lot of communities and a lot of projects in this space have been using as a model for how they are going to start in a very almost startupy way, then over time decentralize into a full DAO. My perspective is that that can actually be very difficult, especially for us mere humans who don’t have the capability of deciding one day that they want to give up all the power that they acquired over time as a founder of this now successful startup.

(00:44:25):

It takes a really special person to do that. Fortunately, I think in this space, we have a lot of special people, but this technology, what we’ve been building is not going to be successful if we build in assumptions that the people who are using it are special people. Everybody is certainly special in their own way, but that is a particular way that you need to be really special in order to have it work. I think much better to create patterns and models that don’t require that people have this superhuman ability to give up power that they’ve already consolidated. Instead, what I hope to see is more communities, more DAOs starting from a position of distributed power, even if it’s within a very small group, even if it’s within a highly permissioned group, and then slowly starting to increase the size of that group even while maintaining more of an even distribution of that power within that group at whatever size it gets to.

(00:45:29):

The larger the group becomes, the more permeable the membrane between the group, the in-group and the outgroup, the more permissionless the DAO, the more mechanisms and structures need to be put into place to actually facilitate that without succumbing to low signal-to-noise ratios and all of the noise that you can get in a permissionless setting, but those things take time to construct and they’re never going to be the same for two different DAOs or two different communities. They take time to build up. They take time to figure out what is going to work. So my recommendation is to start with a small permission group that has fairly distributed authorities, fairly distributed powers, and then practice what it means to make decisions and take actions as a collective, and then slowly figure out how to bring other people in and then figure out what mechanisms and structures you need to support that at greater and greater scale and at greater and greater permissionless.

Nick (00:46:34):

A common question I ask on the podcast is, how important is The Graph for web3? Then I’ve been interviewing these different specialists. Defi, how important is defi for web3? Developer community, how important is the dev community for web3? So I want to ask you as a specialist and expert in DAOs and this incredible product at DAOHaus, how important are DAOs for web3?

Spencer Graham (00:46:56):

They are crucial, 100% important. If we aren’t able to figure out DAOs, then web3 will not fulfill its true promise. There will always be some degree of a high concentration of power that is able to influence or control changes to or even control platforms in general. One of the promises of web3 is that individuals can remain fully autonomous and have control over their own information, their own data, their own assets, while they are also able to interact with and create value with everybody else. DAOs are the way that we do that in a manner in which those relationships and that autonomy cannot be captured and diverted to other means or other objectives by somebody or some small group of people with highly concentrated power. If we can’t get DAOs to work, then we’re likely going to return to something that is a little bit more akin to the web2 scenario that we have now.

Nick (00:48:02):

As a DAO member, one of the things that surprise me most, and actually it was you that prompted this thought in me months ago, was the disciplines, academic disciplines that come into play, these different schools of thought in coordinating and orchestrating an effective DAO. So for example, economics and incentivization, really important. You mentioned Coordinape there. That’s one way to address some of these things. You mentioned game theory in one of the early consulting calls. Blew my mind. I never thought of it, but yeah, DAO’s game theory, there’s a little bit of that, and then, of course, hearkening back to your own background, psychology and people personality, the social experiment of what DAOs are. Has that been your experience as well? Is this a melting pot of all these different disciplines coming together?

Spencer Graham (00:48:51):

It’s complicated and it’s messy, but it’s really beautiful. It’s one of the things that attracts me so much to this space, not just DAOs, but the broader blockchain space in general is that all of these things, all of these disciplines come crashing together and to really understand the power of it all, you have to understand at least to a degree some of all of those different things. I’m interested in all of them and especially interested in where they come together. It’s intellectually incredibly stimulating all the time, which is one of the reasons I’m so energized by everything in this space. It’s so easy to just say yes to working in this space on an ongoing basis. I think that that’s especially the case for DAOs because you add I could have dial up the social stuff and the psychological stuff to a great degree.

Nick (00:49:50):

Well, it’s a brilliant perspective. I appreciate that. Based on my own experience, there’s a lot more to learn about DAOs and in coordinating human activity and all these different elements, for sure, but it is an important component of web3. I want to ask you some questions about The Graph. Like I said, you and I first met because The Graph Advocates launched a DAO, Graph Advocates DAO. So I want to know when did you first become aware of The Graph.

Spencer Graham (00:50:15):

I think, looking back, that I first became aware of The Graph, it might have been in … I think it was sometime in 2018. I at the time was extremely interested in a lot of the experiments and theoretical thinking relating to tokens, token-curated registries, curation markets. This was an amazing area of research and theoretical concepts that I was just enamored with. I joined some community calls focused on just people wanting to talk about this stuff, focused on curation markets. I remember, I think it was Brandon Ramirez at one of those calls introducing what The Graph was and talking about some of his ideas about using curation markets to help, essentially, curate what would end up becoming the subgraph curation mechanism. So it’s very cool that that is a thing and it exists and is working because I remember some of the first … I was just a fly on the wall at that time, but just some of the first ideas shared into the community about how that could possibly work.

Nick (00:51:23):

So does DAOHaus use The Graph?

Spencer Graham (00:51:25):

Yes. Basically, I would say 90% of the data that you see if you go into the DAOHaus app is coming from The Graph or from one of our multiple subgraphs, and we have subgraphs or we could call it our super graph, which is a bunch of different subgraphs composed together for when you launch or summon a DAO, for when you’re creating proposals or voting on proposals, for when you are using side vaults, for all of that stuff. Then we also have another subgraph that is focused on the add-ins or plug-ins that we call boosts that ties all the data together. We love that because we want to maintain as little infrastructure and servers as we possibly can. We still use one web2-ish API and then server for some of the data that we’ve not yet figured out how to push to the edges, so to speak, but The Graph is a huge reason that we can operate at the low overhead level that we can operate at.

Nick (00:52:35):

How important do you think The Graph is for web3, a solution like The Graph to be able to do these types of things?

Spencer Graham (00:52:41):

I think it’s crucial. I think there’s so much about so many of the trade-offs involved in creating a blockchain make it very difficult to have data coming out of the blockchain be indexable and searchable or readable or queryable in an efficient way. So that just creates a fundamental need to have this other layer on top of that that facilitates that for front ends and applications. It’s not going to be web3 if that is some centralized indexing service that every single application has to either buy from somebody else or build themselves. So The Graph or something like The Graph just absolutely has to exist for web3 to be web3.

Nick (00:53:30):

Spencer, the last question I want to ask you is about your vision for web3. You’ve talked about it a couple times, especially going back to your days in healthcare and this epiphany you had about how web3 and blockchain could impact something as important to everybody as healthcare. What excites you most about the future of web3?

Spencer Graham (00:53:49):

My thinking here is a little bit maybe general. There’s something that’s starting to resonate with me recently, which is this idea that we can in web3, uniquely I think, start to meld together and create a really fascinating interplay between what I have started calling shared resources. So these are public good-ish things or a DAO treasury that everybody in the DAO collectively can control or publicly available smart contracts. So this interplay between shared resources like that and private resources. In this case, I don’t mean private like privacy, I mean private as in specific to me or specific to you or something that I have full autonomy over for myself or you have full autonomy over for yourself.

(00:54:46):

Blockchains enable the ladder. Certainly, that’s the foundation of all of it. We have sovereign control over our own funds, our own assets, our own information. web3 expands on that, especially with our own data, but then DAOs and that side of all of this facilitates this idea of shared resources and things that we can collectively control and collectively manage without any of us individually owning the entire thing or being able to control the entire thing.

(00:55:21):

I think there’s a lot of really interesting interplays between those two domains that are typically separate that we have yet to explore that I think web3 is going to unlock. MolochDAOs, I think, are one of the first examples of that because of that ragequit mechanism, the idea that you can redeem your shares for a fair portion of what is in the treasury. It means that what actually is happening is that a MolochDAO is, to use a physics example, like a super position of shared property and private property. My property is still my property, but it’s also shared across everybody else in the DAO. I may be wrong, but I don’t think that’s possible anywhere else. So as those interplays are melding of these two concepts, then I think we’re going to see some pretty wild stuff happening in that area within web3. I’m really excited about that kind of thing.

Nick (00:56:18):

All right, Spencer. Well, we’ve reached the point in the episode where I’m now going to ask you the GRTiQ 10. These are 10 questions I ask each guest of the podcast every week to help listeners learn something new, try something different or to achieve more. So are you ready for the GRTiQ 10.

Spencer Graham (00:56:33):

Let’s go.

Nick (00:56:45):

What book or articles had the most impact on your life?

Spencer Graham (00:56:48):

I think it’s The Selfish Gene. It completely changed the way that I view the world and unlocked this ability in me to see underlying structures that may not be obvious from a higher level view. So that really changed my ability to interact with the world in a fundamentally different way.

Nick (00:57:08):

Is there a movie or a TV show that you think everybody should require to watch?

Spencer Graham (00:57:12):

I am in love with the BoJack Horseman show on Netflix. It is hilarious and has just an amazing emotional depth to it and allows … I think gives people access to some really dark psychological experiences without being overwhelming in that sense.

Nick (00:57:32):

If you could only listen to one music album for the rest of your life, which one would you choose?

Spencer Graham (00:57:37):

This is tough, but I think I had to choose. At least right now, it would be an album by the War on Drugs called a Deeper Understanding. It has this great mix of very soothing, but also being very energetic and upbeat in a sense.

Nick (00:57:52):

What’s the best advice anyone’s ever given to you?

Spencer Graham (00:57:55):

To learn from people’s advice, but not necessarily take it.

Nick (00:58:00):

What’s one thing you’ve learned in your life that you don’t think most other people have learned yet or know?

Spencer Graham (00:58:05):

Most things in the end are structural in nature.

Nick (00:58:09):

What’s the best life hack you’ve discovered for yourself?

Spencer Graham (00:58:12):

This is funny because I have tried a number of various life hacks to try to control my future self, and what I’ve learned is that I struggle with that. So the best life hack that I have learned for myself is just to know myself and know what my tendencies are and to just try to work within those.

Nick (00:58:29):

Based on your own experiences and observations, what’s the one habit or characteristic that you think best explains people finding success in life?

Spencer Graham (00:58:38):

I think it’s the same answer, knowing themselves in a deep way.

Nick (00:58:42):

Then the final three questions, Spencer, are complete the sentence type questions. So the first one is, “The thing that most excites me about web3 is …”

Spencer Graham (00:58:50):

The potential for uncapturable individual autonomy.

Nick (00:58:55):

The second one, “If you’re on Twitter, then you should be following …”

Spencer Graham (00:58:59):

Dystopia Breaker.

Nick (00:59:01):

Lastly, complete the sentence, “I’m happiest when …”

Spencer Graham (00:59:04):

I’m happiest when I am psychologically safe and in control of what I focus on.

Nick (00:59:17):

Well, Spencer, thank you so much for your time. You’ve been very generous and a lot of incredible ideas today, for sure. So I thank you for sharing some of the depth and the insight there. If people want to learn more about you or follow the work that you’re doing at DAOHaus, what’s the best way to do it?

Spencer Graham (00:59:31):

Best way to follow me and get in touch with and communicate with me is probably Twitter. So my Twitter handle is @SpenGra. It’s a smashing together of my first and last names. Following DAOHaus or staying up-to-date on what DAOHaus is doing, the DAOHaus Twitter is now NowDAOIt, N-O-W-D-A-O-I-T. So that’s a great place. Another great place is the DAOHaus landing page website, DAOHaus.club, and that’ll have links to the app, to our documentation, to our Discord community, and to all of that stuff.