🤔 What is a Community Contribution Opportunity (CCO)?
It's a new way to raise money for you community, project, team, whatever and we're here to break it down for you. (Because our second one is coming up! 😬 More on that at the bottom.)
We’ve danced around it here and there in our previous posts, but the time has come to lay out our thoughts around what we’ve been calling a Community Contribution Opportunity, or CCO. Why? Well, for one we’ve got our second CCO coming up to raise funds for the next phase of DAOhaus development and decentralization. (More on that in a sec.) But also because, with DAOhaus version 2, we’ve built the tooling to allow other projects to CCO as well. (Check out Array.Finance’s 1 Million DAI Raise.)
So, let’s talk about how it works.
Proof of Contribution
Like so many conversations in the Haus, this one also starts from the idea of Proof of Contribution. For the best dissection, check out this post. But, the quick version is that “proof of contribution” is a new way of thinking about how contributors are rewarded for what they bring to a project to a project, whether that’s time or money. This is core to the idea of the CCO.
Most projects start small, and most contributions come in the form of work done to move the project forward. Eventually, though, it comes time to infuse some capital to scale whatever the effort at hand may be. It is always tricky to know how to think about contributions in the form of capital. Capital is critical, but the work is the hard part. What’s more, under most traditional fundraising mechanisms the people with the power to contribute capital is limited, and so those with capital tend to see outsized return compared to the workers.
The CCO is an effort to reconcile this by changing the dynamics by which contributions in the form of both capital and work are rewarded. (Check out the post linked above for specifics on how that works.) The CCO is also a chance to trend closer to something like crowdfunding in its capacity to draw funds directly from a given community, not only from the “investor” class. And, regardless of where the it comes from, reward that contribution fairly.
Community Contribution, Community Treasury
Much like an IPO or an ICO, a CCO is, at its core, a way to raise money. But it’s different way to raise money. An IPO is a stock offering, and an ICO is basically the same with with tokens instead of stocks. A CCO is something different. A CCO is about a community coming together to support a project. The funds flow directly into a DAO, which is ultimately controlled by that same community through their power to vote on proposals and/or rage quit (taking their funds with them.)
When a project raises money through traditional means these dynamics are very different. The money flows in and the investors basically just have to hope that the team does as they promised. Through a CCO there are proactive ways for investors to be involved. This difference in dynamic alone has made all the difference in our experience. Everyone involved with the project, from the core team to the investors, has a different relationship to the project.
How to CCO?
The answer is, yeah, probably. Of course, it isn’t just a simple as setting up a DAO, but it’s close. If you have an established community and something you need to fund, a CCO could be ideal, and we’ve made it easy to get everything set up through DAOhaus. Once you’ve set up your DAO, community members can make contributions in exchange for non-transferable DAO Shares or Loot Shares (no voting rights.) It’ll look something like this 👇
We’re also working on some other features to make CCOs even easier, and more flexible. If you’d like to use transmutation or something fancier, lets us know in our Discord and we’re happy to help you get set up.
Already have an existing company? You can CCO too. We’ve got an in depth writeup on it right here. But the short version is, sure, you can CCO also. In fact, it’s a great mechanism to use if you want to “exit to community” while raising your next round of funding.
DAOhaus Second Story CCO
Finally, let’s talk about the next round for DAOhaus. We are gearing up for our second round CCO. After raising 250,000 DAI 6 months ago, we have built everything we promised (and more) and in doing so we have transmuted the raised funds in to $HAUS tokens. Before this next round we will be liquidating our DAO and dispersing all of the $HAUS tokens earned in this round.
This means time has come to raise our next round. We are calling this one DAOhaus Second Story CCO because we built the foundation and the first floor; now here we are raising money to build the second. We will be running the Second Story CCO via slightly different dynamics than we did our First Story CCO. That CCO effectively bootstrapped $HAUS token into existence via transmutation and proof of work. As we outlined last week, with the launch of UberHaus we are taking steps toward the next use case for $HAUS. As such, our Second Story CCO plans will more directly reflect this reality by putting $HAUS tokens more directly into the hands of capital contributors.
We will have more information soon on our Second Story CCO plans. If you want to catch that information before anyone else, be sure to sign up 👇
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