First off, DAOs are a big deal. They facilitate human cooperation in truly interesting and paradigm shifting ways. If you want to know more about DAOs in general watch this:
Or just jump in here:
Critically though, simple DAOs use software to handle the administration of funds for communal projects. A bunch of people can put money into a pot, and then use the DAO tools to allocate that money for a common cause. In some cases this is a much better way to do this than traditional means of funding projects.
Enter “rage quit.”
Otherwise, if you're hanging around castles like DAOhaus, you've probably already heard the term "rage quit." If you’re a modern internet user, I’m willing to bet you've done it. Maybe not from a DAO, but you've def done it.
What is a rage quit?
The term "rage quit" has a very specific meaning within DAO parlance, but it wasn't just made up because everyone feels like panda 👆occasionally, especially with computers. It's a gaming term, and also (in my world) a user experience term.
Most websites use basic analytics so that the team running the site can tell if their site is working. It lets us know basic things like which links were clicked. Also, when clicks missed links, because that helps us understand if a link is unclear or in the wrong place. Well, there's a thing we track called a "rage click." It's a typical pattern. It happens all the time, even on good sites.
A "rage click" is when a user clicks, like, 20 times, really quickly on a button on your site. You know, you've done it. Generally a rage click means that a process is taking too long, or something like that. Hopefuly a CPU or internet speed problem, amirite?
Sometimes users rage click a whole bunch of times and then leave. Often they never come back. THAT is a "rage quit."
"Quitting" is a right.
In DAO speak, "rage quit" is named for the above phenomenon, but it's probably more aptly called "freedom to leave" or something like that. And, like the domino that kicks off a paradigm shift, it seems too simple to be such a big deal. But it is.
Rage quit can be built into DAOs (and is core to the DAO structure we prefer at DAOhaus.) This means it's just a choice in the software, and in this case these are smart contracts. So really, within your DAOhaus DAO, "rage quit" is actually a right. You can leave any DAO you are a member of, with just a few clicks. The rest of the DAO cannot stop you. Freedom to leave.
But that’s not all. Rage quit is actually the ability to leave, and take your money with you. This is very powerful and aligned properly it can motivate cooperation and empower a community. You quit "shares" one at a time, and when you do, you get back your proportional share of the DAOs funds. (So, for example, if 30% of the communal funds have been spent, you will get 70% back per share. If the DAO has revenue, you might get 120% back, it works that direction too.)
The DAO building DAOhaus is structured this way. Anyone who contributed funds can vote with their dollars if they don't like our direction. If too many of them jump ship, it will start a cascade, which we (hausDAO) certainly don’t want.
This creates a very different version of "skin in the game."
Skin in the game.
Normally when you contribute money to help a project (and you're not buying anything) you're either investing, or donating.
If you're investing, it's very all or nothing. You promise to hand over a chunk of change. Maybe it gets burned through with no return, bad investment. If you're donating, it's similarly all or nothing. You hand over your money and hope for some transparency from whoever you gave it to.
The programatic existence of "exit rights" creates a new dynamic for contribution to a project. Sure, anyone could throw money in and then just go about their business. But the built in transparency of a DAO means that anyone who wants to protect their money can see what's happening in DAO transactions, and take their share back out.
In the end, this empowers communities to think about how they allocate capital, both human and financial, in a different way. And it has already resulted in a bunch of awesome projects, like DAOhaus itself.
We're running our own experiment. DAOhaus is community funded. Anyone who contributed can quit their shares at any time. Say we start missing deadlines, or too many members of the team show up with Lambos. For us there is a built in accountability to our community, and they are empowered to let us know what they think. We’re proud to say, no Rage Quits so far.
Launch your own DAO
The mission of DAOhaus is to let anyone launch their own magical community owned DAO, with exit rights built in. If this sounds cool, drop us a line in our Discord, we'll help you get set up.
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