By Tara Merk and Judy Mam
DADA has never been anything you might call a normal startup or project. We’re a bunch of weirdos. Since our inception in 2014 our mission has always been the creation of a community through which people from around the world can communicate through art, expressing their creativity and co-creating freely, while we capture and grow the value created by DADA; that is, by its artists, developers, and contributors for the benefit of the entire community. To this end, we embarked on our journey towards the Invisible Economy where, by radically separating the art created on DADA from the market, artists are empowered to continue creating art for pure joy and solely out of intrinsic motivation. During the last two years we have also been implementing the Invisible Economy in the operation and evolution of DADA itself. However, while we quietly continued on our path away from the forces of the art market, the world had other plans.
2021 marked the explosion of the NFT market. As a pioneer in the digital art and NFT space, DADA experienced the craze first hand and full force. What we like to call the Apestorm of 2021 abruptly brought us back into full contact with the market. Our 2017 and 2019 Creeps & Weirdos collections were soon recognized by many digital art collectors and especially appreciated for both their artistic and historic value. The Apestorm forced our hand into updating our Creeps & Weirdos marketplace and making some important decisions about our legacy as pioneers in the NFT space. We decided to honor our history by keeping the 2017 Creeps and 2019 Weirdos as two separate collections. We also conducted a daring rescue of the 2017 Creeps to prevent them from being swept by bots before collectors could buy them. Since then we have sold Creeps to collectors, we have created a wrapper so that historical collections can be traded on OpenSea and we have finally had some revenues after almost ten years of existence. As we factor in these developments while continuing to push towards the Invisible Economy, we have decided it is time to take the next step in our organizational development.
It is time for DADA to Exit to the Community.
What is E2C and what does it mean for DADA and for you? Usually, a company exit is a step companies take to help early investors and founders reap the benefits of their risk taking once a company has revenue. However, traditional company exits are not what DADA has in mind.
Exit to Community (or E2C) is a young movement which aims to find alternatives to the standard model of a company exit. It is led by a broad alliance of organizations, startups, and researchers. While each organization embarks on its own individual process towards E2C, all share the common goal of transitioning ownership and control of a project to the people for whom it matters most: the community.
The rationale behind E2C isn’t new. E2C addresses the desire to give back rewards and control to the people who are affected by a particular product or service. It could be the drivers at Uber, the users on Twitter, or the artists and contributors on DADA. In E2C, communities aren’t a means towards retaining revenue or growing a customer base. In E2C, communities are what give life to a project or product and an end in themselves. Especially when it comes to digital platforms, as DADA is to an extent, E2C is somewhat aligned with what is called platform cooperativism, which is the idea that online platforms should be owned and governed as digital cooperatives by their users and the maintainers of the platform rather than a centrally owned and publicly traded company such as Facebook.
Today, E2Cs come in many different ways. Last year, Nathan Schneider and Morshed Mannan published a paper outlining three potential avenues for E2C. They explain options involving a stockholding trust, a federated architecture or using blockchain enabled tokenization.
As blockchain pioneers that aim to capture and maintain the value we’ve been building on Ethereum since 2017, the last option is most relevant to DADA.
Although tokenization seems an obvious choice, it’s easier said than done. What aspects of DADAs future are tokens a useful representation of ownership and control?
Where do they conflict with our vision of the Invisible Economy?
What does a fair token distribution look like for DADA, which has different kinds of stakeholders like founders, investors, artists, developers and contributors to the Invisible Economy?
Which other mechanisms and processes can supplement DADA’s E2C via tokenization?
As future owners and governors of DADA you, the community, can start getting actively involved in helping us figure out the answers to some of these tough questions. DADAs aim isn’t just to Exit to the Community but also to Exit with the Community.
The DADA E2C process: how, when and where?
As previously stated, E2C is an emerging process without a one-size-fits-all blueprint or process to follow. Consequently, we’ll need to do what we do best: get creative and figure out the DADA way in all of this. Practically this requires dealing with a number of different areas and sub-domains:
Legal:
- What’s the best form of legal entity that enables DADA to continue as a wholly community owned and controlled project, while providing legal certainty and protection to all members?
- What legal considerations do we need to keep in mind when minting and distributing governance tokens?
Economic and financial:
- Which resources need to be transitioned to community ownership?
- How will this occur practically?
- How will these resources benefit the community and the Invisible Economy? And how will they be sustained over time?
Governance:
- With the community in control, how will governance work to remain fair, equal, efficient and transparent?
Technical:
- What does this transition mean for the configuration of the platform and the current collection of art on the Ethereum blockchain?
- How and where will tokens be minted, distributed and used?
- Which supporting tools will we require to implement our governance designs?
- Are there other technologies we can draw on to help us on our path towards E2C and the Invisible Economy?
As you can imagine, there’s a lot to discuss, deliberate, and decide. This blog post officially kicks off the E2C process. We will keep you updated and involved in these pages where we will share all relevant updates and summarize major developments and decisions in future blog posts, in English and in Spanish. Anyone who wants to be informed and involved is invited to read this blog and ask questions and discuss the contents in the DADA Discord Exit to Community Channel.
It is a very exciting time and we are grateful and lucky to have a group of amazingly talented, smart and capable people contributing to this transition. Join us in making it a reality.
