HackMD - Collaborative Markdown Knowledge Base

DAO Strengths Self-ownership leads to increased passion Flexibility and malleability Skin-in-the-game Creative signal creation and propagation - ideas flow more freely Protections provided by smart contracts; reducing counter party risk Lower friction and barrier to entry Less coersive Rapid iteration on organizational and financial structure More autonony, self responsibility and less victimization Regulatory arbitrage Contracts can be enforced on chain Decentralization of decision making process Scale powerfully with network effects DAO Weaknesses Lower coersion can lead to less accountability and control of accountability No guaranteed accountability No rulebook, lack of established process and model Information asymmetry, contributors are often at a disadvantage in information compared to leadership Hard for DAOs to interoperate because of lack of shared process and structure No single person who is responsible or has the onus to take action Sybil attacks Shared creative vision can lead to a dilution of that vision Friction to achieve consensus Necessity to achieve consensus So many of these weaknesses are engineering problems that stem from the lack of rulebook, process and models DAOs often don’t have a specific desired outcome or mission Lack of legitimate structure Distributed liability Contracts cannot be broken Hyperfinancialization of governance Corporation Strengths Coersive efficiency - you can be easily fired if you don’t produce Formalized structures Well known organizational models, process and rulebooks Lots of capital and access to capital Explicit dictators - leadership is codified Rigid effective hierarchy The dominant human organizational technology B2B Corporations easily interoperate Clarity of expectations and requirements Clear and consistent rewards Ability to interoperate easily with current legal structures Limited liability Personhood Can breach contracts Corporation Weaknesses Legal and regulatory capture Highly coersive - you are often under constant threat of being fired Can have their contracts breached Monopolization; economies of scale lead to widening wealth gap Centralization of decision making process Rivalrous internal nature of corporations leads to undesired behavior Opacity in many ways Near-sighted and tunnel visioned on short term profits Always have to grow Soul crushing Concentrates benefits to fewer and fewer people and entities High employee turnover; low benefit to staying in place Complacent spirit; low innovation