(Ideation) SCP 150: Empowering Workstream Leaders for Monetization Experiments

Proposal Discussion
1

Summary: This proposal aims to grant workstream leaders the authority to conduct monetization experiments on new products or features, specifically. This initiative intends to address the DAO’s financial challenges by generating additional revenues and mitigating user drop-offs. The proposal suggests implementing a trial period for these monetization experiments with defined success and failure metrics.

Abstract: This proposal advocates for providing workstream leaders with the responsibility to conduct monetization experiments for newly developed or added features, particularly inspired by the spirited discussion on the ThorChain streaming swaps feature. With the goal of addressing financial constraints stemming from the shrinking runway and Treasury funds, this proposal seeks to introduce controlled monetization strategies as outlined in the product goals. By allowing these experiments, ShapeShift anticipates generating supplementary revenues while simultaneously gaining insights into user preferences. The proposal entails a structured trial period during which each experiment’s outcomes will be measured against predetermined success and failure metrics.

Motivation: The motivation behind this proposal is multifaceted. First, the dwindling runway and Treasury funds have posed financial challenges that necessitate innovative approaches to revenue generation. Second, the observed decline in user engagement following the conclusion of OP Season 2 underscores the importance of proactive strategies to enhance user retention and experience. Empowering workstream leaders to conduct monetization experiments aligns with ShapeShift’s mission to ensure sustainability while fostering user satisfaction. This proposal’s implementation would enhance financial resilience, promote user engagement, and foster a culture of experimentation within the organization.

Specification: The proposal entails delegating authority to workstream leaders to design and execute monetization experiments for new features added since July 1, 2023. Each experiment will be meticulously planned, including the establishment of clear success and failure metrics. Over a designated trial period of two months, workstream leaders will monitor the experiment’s impact on a blend of user engagement, revenues, and other relevant KPIs. Should the success metrics be met, the monetization strategy could be further refined or maintained. In cases where success metrics are not achieved, workstream leaders will have the discretion to opt for optional donations or no monetization, as deemed appropriate. Should a governance proposal for moving forward be necessary, it will be stewarded by the workstream leaders.

Benefits: Implementing this proposal offers several key benefits. First, it provides an avenue to increase revenues, alleviating financial constraints and enhancing ShapeShift’s sustainability. Second, by allowing controlled experiments, the organization gains valuable insights into user behavior and preferences, facilitating data-driven decision-making. Third, this approach fosters a culture of innovation and adaptability by empowering workstream leaders to take ownership of monetization strategies, ultimately contributing to the organization’s long-term success.

Drawbacks: While this proposal presents numerous advantages, potential drawbacks must also be acknowledged. There is a possibility that certain monetization strategies may not resonate with users, leading to negative impacts on user engagement and brand perception. This could lead to mixed messaging around the ShapeShift DAO within the cryptocurrency ecosystem. Additionally, implementing and monitoring multiple experiments may require additional time and resources from workstream leaders, diverting their attention from other critical tasks.

Vote -

For: A vote for would show support for allowing workstream leaders to conduct monetization experiments on new products/features within the ShapeShift DAO’s suite of products/offerings moving forward. This includes ensuring that if success metrics are met, these monetization experiments stay in the feature/product suite.

For w/ Changes: Please list the changes you’d like to see in the comment section below.

Against: A vote against would keep things as they are now, removing the recent implementation, and only optional donations would be applied to any new feature until a future proposal suggests a path forward.

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Thanks @PTT for posting this!

One major drawback I do not see listed here is that by adding mandatory fees, even temporarily, we will not be able to claim that our app is a Public Good anymore.

We currently use this status in order to secure grants/funding from partners. This de facto status (up until a recent experiment), strategy, and desire to “preserve” it were confirmed by FOX Holders in SCP-128. If we intend to reverse this, being clear/explicit about would be good, I hope that if this Ideation passes a clear mention of it is added to the text mentioning this fact and the SCP-128.

An example of the impact this new proposal would have: one of the reasons we have applied for a non-spendable OP grant for the “Explore Optimism” Rewards program was to qualify for a RetroPGF Grant at some point in my understanding. A project can only qualify for this if their product is a Public Good (that’s the PG in RetroPGF) and if they have helped the adoption of Optimism, which we now have clearly done (with a lot of efforts/resources).

Partners who value this status are pretty picky about it, we can’t be a Public Good on and off every few weeks, that’s not part of any of their definitions. I base this on my reading of their proceedings/forums and the criteria they publicly apply, but @TWells can correct me if I’m wrong as he brilliantly negotiated with our partners for funding/grants in this context.

So we’re almost sure that by voting “For” this proposal, and if mandatory fees experiments continue (or become permanent) we would put a nail in the coffin of a 3 months long experiment (not counting the time to secure the first Grant) without the DAO being able to get any spendable funding we expected. For reference, the last RetroPGF round numbers (emphasis mine):

In this second round of RetroPGF, 195 people and projects were nominated for funding, and all 195 were awarded funding by the badgeholders! While going above and beyond in assessing project impact these badgeholders allocated their votes among 40 different projects on average. The median OP received by a project for RetroPGF 2 was 22,825, while the top 10% of projects received more than 140k OP [N.B: At current OP’s value that’s ~210,000 USD].

Sources: https://optimism.mirror.xyz/Upn_LtV2-3SviXgX_PE_LyA7YI00jQyoM1yf55ltvvI

There are also issues with the way Product has decided to measure their first “experiment”. Disregarding the fact it has been started (and still continues) in contradiction with a current explicit governance decision (namely SCP-128, again, in favor of opt-out donation and against mandatory fees), I’ve looked into the methodology used, and it has been setup with factual biases that I’ve communicated to Product on Discord on 2023-08-25. Unfortunately, the answer I have receive so far is rather dismissive (did not address the points raised) and qualified my concerns as just an opinion. The fact is that fees are clearly hidden by default in the UI and no explicit messaging was done to inform users that mandatory fees were now applied on their transactions on this feature (unlike what happens everywhere else in the rest of the app). How exactly are users supposed to make a decision based on added fees if they aren’t made aware of their addition? How is this supposed to be compared to opt-out donations which have always been clearly in view of users?

I think @willyfox also raised a valid point regarding Success/Failure metrics, it might be tempting for Workstream Leader to unilaterally set these goals to setup their experiment for an almost inevitable success. I think these measured goals should be arrived to as a common effort from all the Workstreams if you want them to have any validity (all of them participate in executing them, close or far). Not sure how you’d organize a vote on this, or if to avoid this internal process you’d use governance, but it is a serious concern.

All of this reveals an important aspect of such experiments which imply important strategic changes for the DAO, they cannot be organized in an extremely short time or enabled on a whim, they require a collaboration between most Workstreams, and if the implications are as important as all the ones I’ve described above, they deserve in my opinion a vote of confidence by FOX Holders with clear parameters and metrics. I’m sure our contributors and FOX holders would have raised these concerns/issues if they had had the opportunity to do it, and weren’t just presented with a fait accompli by Product and Engineering.

For all these reasons I will vote “Against” this proposal to grant this perpetual power to change our DAO’s strategy to the Workstream Leaders.

Last thought, this also does not specify the scope of which Workstream Leaders can take these decisions and how they can enforce the execution of such decision. It seems like only Product and Engineering would ever be able to orchestrate this kinda of changes (with Code Owners as the ultimate gate keepers), so why attribute this power to all Workstream Leaders?

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Thanks @PTT for posting this :pray: We can disagree on whether enabling fees right now is the best strategy, but I do strongly agree that this decision (or whether to delegate this decision) should be explicitly made by the community.

I would like to call this proposal what it really is "Delegating authority to workstream leaders to enable fees.” While I’m not suggesting this was the intention, I think the current title “greenwashes” what is actually taking place here.

The failure metrics that were described by @0xfbl when he announced that he had decided to enable fees are very unlikely to be hit considering the fact that we just launched THORChain streaming swaps, will be launching the Multichain metamask snap in September, and most importantly, the fact that over 1 week after fees being enabled, the fees are still buried inside an expandable section of the trade confirm step. I doubt most users that are trading on THORChain via ShapeShift right now have any idea that they’re being charged fees.

If the purpose was really to run an experiment, rather than an experiment designed for a specific outcome (justifying fees), it is one of the most poorly designed experiments i’ve seen. The fees are still hidden. The first page you see on the app still says "100% fee.” When streaming swaps were first deployed, the app incorrectly displayed ShapeShift’s fee as “free,” lead to most of the publicity on twitter at launch saying that streaming swaps on ShapeShift are free. That, coupled with unilaterally enabling fees right when a big new feature is launched and 2 weeks before metamask snaps launches, and then saying the only way the “experiment” fails is if users drop 50% :roll_eyes:

Instead, we could have launched streaming swaps with optional donations 1 day sooner and measured the results from that while going through governance to get clear consent (or not if FOX holders don’t think that’s the best strategy), plus captured the max amount of users from the streaming swaps and multichain launch.

For these reasons, I do not have confidence in delegating authority to workstream leaders to enable fees, regardless of whether or not they dub it an experiment. If workstream leaders want to be able to add fees, I strongly think they should first get permission from the community, and that the community should have a clear understanding of what they are voting for. I :purple_heart: you @PTT but I am voting No on this one.