---
# System prepended metadata

title: Sweating into the DAO
tags: [comp]

---

## Purpose

We are bootstrapping a DAO to represent the interests of Smart Invoice as a protocol. Current shares represent previous effort on the project, but as work progresses the power and economic interest in the future of the DAO should increase. Setting up a process for this earning of shares and loot is important so it is systematic and clear for contributors how they can earn their way into the DAO.

## Earn rate

As we are sacrificing our freelance rate for a project we all get to own and be a part of, we earn shares or loot for work that is shipped. An initial rate of 1 share/loot per $100 of work completed will be set. This does not signify any value of a share, but just a rate by which shares can be earned.

**tl;dr** 1 share / $100 compensation

## Quarterly cap

We want whomever is working on the project to earn shares so that their voting power increases from contributing to this great project, but earning too much voting power too quickly can alter the balance of power. For this reason the initial distribution gave more loot to the original members so there isn't an outsized influence that cannot be overcome. Moving forward a cap of 50 shares per quarter is the maximum you can earn. After that you will earn loot so the economic gain should there ever be value to the investment of sweat is still there, but you won't have outsized governance power.

**tl;dr** 50 shares / quarter

## Process

The sweat shares will be tracked off-chain and put on-chain in a proposal in a bulk basis. The timing of this will depend on the amount of work done. It should be done at least quarterly, but should occur when additional shares to add are to 50 or on the request of a recipient. In the future we may want a special proposal to group compensation and share distribution in the same proposal. Alternatively we could have a shaman that automates some of this without the need of additional proposals.

**tl;dr** in bulk, undetermined frequency

## Conclusion

Giving contributors a way of earning into a DAO is very valuable to grow the ownership set in a sustainable way. This process should address some of the issues with governance that might come up. Ratification of this should go through a signal proposal and modifications should follow a similar process.