Proposal “coreteamcomp101801“ (Completed)Back

Title:Core Team Compensation: Devs and Ops (October)
One-time payment: 1711 DASH (52962 USD)
Completed payments: 1 totaling in 1711 DASH (0 month remaining)
Payment start/end: 2018-09-17 / 2018-10-16 (added on 2018-09-08)
Final voting deadline: in passed
Votes: 0 Yes / 0 No / 0 Abstain

Proposal description

Dash Core Group October 1st Funding Proposals
DCG is submitting 5 funding proposals for the October 1st budget cycle:
1) DCG Comp (Developers and Operations): $325,000 (current proposal)
2) DCG Comp (Administration): $100,000 (here)
3) DCG Comp (Bus Dev / Marketing / Cust Support): $75,000 (here)
4) DCG Business Development: $160,000 (here)
5) DCG Public Relations: $40,000 (here)

Note: Over the past 2 months finance has worked on managing, calculating and optimizing our tax liability.  We identified a number of opportunities to lower our tax burden during that time and validated those opportunities with tax experts.  We developed legal arguments to enable certain tax treatments of assets and transactions that lowered our estimated tax obligations.  Ian Rawluk, who recently joined the finance team, was instrumental in driving the effort over the finish line.  

As a result of these efforts, we will not need to submit a 3rd tax proposal related to the first quarter of fiscal 2019.  We expect our current tax funds to be sufficient to cover us through both fiscal year 2018 and fiscal year 2019.

This Proposal

This is a cross-posted from here
If you have already read one of the other compensation proposals please skip to the section titled “What does this specific proposal fund?”. The next two sections are duplicated in all three compensation proposals.

Note on DCG Compensation Proposals This Month
Last month’s compensation proposal finished voting with “no” votes constituting greater than 10% of the total votes cast. This triggers a commitment by Dash Core Group (“DCG”, “we”) made in a compensation proposal from April 2017 to break out the core team compensation into separate proposals. Despite “no” votes breaking the 10% threshold, the September compensation proposal had overwhelming support; it had the 3rd highest net vote count even though it was competing with numerous multi-month proposals.  

The compensation proposal from April 2017 stated that: “Core team salary proposals have been highly supported by the network. In fact, in last month's budget, the least-supported of these proposals received 989 "yes" votes to only 20 "no" votes. Continuing to break out individual budgets is time-consuming, costs additional resources (proposal costs), and seems to add little value given the current level of support for these expenses. If in the future more than 10% of the votes cast for core team salary are "no", I can solicit feedback on what the network would like separately voted upon, and attempt to provide the requested additional granularity in future budget cycles.”  Link:

Many of the MNOs voting “no” this most recent cycle commented that they were voting “no” specifically to trigger a breakout of the budget, either to gain greater insight into the allocation of those funds, or to allow them to express which functions they support.

This month we will be providing the network with 3 compensation proposals in order to fulfil our promise to provide additional granularity. Those 3 proposals will consist of: 1) Developers & Operations, 2) Administration, 3) Business Development / Marketing / Customer Support.  If all three of these proposals pass we will no longer provide granular proposals for the remainder of 2018.
There are numerous reasons for not providing granular proposals in the future:
  1. Beginning in Q1 2019 Masternode owners will have a mechanism to decide how Dash Core Group organizes / pays compensation by electing Trust Protectors. This is a far more “direct” way to influence our operations, as the elected Trust Protectors will be elected based on how well their “platform” matches the desires of the network (e.g., “DCG should do x and shouldn’t do y”). A full description of that process can be accessed at the following link:  We strongly believe that by equipping masternode owners with a tool to enact change at Dash Core Group, we will no longer have to provide granular proposals for compensation as the proposal system is a crude tool at best for providing that type of direction.
  2. At Dash Core Group, we work as a cohesive team and it is disruptive to the organization to have the potential for a part of the group to not get funded when there are many interdependencies between internal departments.
  3. Submitting individual budgets is time-consuming and costly; this time can be better spent in ways that benefit the Dash Network.
  4. Submitting individual budgets reduces the effective size of the DAO budget, by consuming additional proposal fee reimbursements.
  5. There is little value given the level of support for these expenses (as aforementioned, even though the September compensation proposal had over 10% of “no” votes, it still passed with the 3rd highest net vote count even though it was competing with numerous multi-month proposals).

Background Common To All 3 Compensation Proposals
During the last quarterly call, we committed to requesting no more than 40% of the total Dash DAO budget for run-rate compensation expenses. In addition to that amount we plan to continue requesting funds from the network to build a buffer in our compensation account and funding of other projects. We are separately targeting all of our proposals to not exceed 60% of total available funding from the network. This will ensure substantial resources remain available for other entities serving the network, regardless of whether all DCG proposals pass.
As the price of Dash declined into the $130s at one point in August, several actions were taken to reduce our run-rate to ensure we can abide by these thresholds. Specifically:

  1. Individuals on the DCG Board and 2 senior staff members elected to voluntarily reduce their own compensation rather than reducing team size or impacting compensation rates. This action was taken with the understanding that the reduction will remain in place until the desired core team compensation budget buffer is established and the Dash budget can sufficiently cover our ongoing run-rate costs. While individual situations and ability to reduce compensation varied, the cuts amounted to approximately 45-50% of our Board members’ and the senior staff volunteers’ compensation.
  2. Research into graphene scaling solutions are no longer paid out of the Dash Core Group budget. This research was transitioned to ASU when the 2018-2019 academic year began last month.
  3. Through natural attrition, two contracts expired and were not replaced.

We have two primary goals when we manage our compensation account. First, we need to ensure that our run-rate is sustainable at current prices. Second, we must build up a sufficient buffer that serves as protection against a prolonged period of time were the price of Dash stagnated in the low to mid- $100s or below. We continue to build our buffer each month, but our current projected “buffer” for September will be ~$270,000 - which doesn’t even cover the compensation liability we will incur in September.

We also continue to have a hiring freeze in place. We do not intend on unfreezing hiring or reversing the voluntary reductions until both the price of Dash is sufficient to maintain our run-rate and we have put in place a significantly larger buffer.

What does this specific proposal fund?
This proposal funds Dash Core Group's ongoing run-rate compensation costs for development and operations. Development includes coders and engineers. Operations includes project managers, testing / quality assurance, and infrastructure engineers. We have chosen to put all of these units under one umbrella since they work as a tightly knit team; coders without project managers, QA or infrastructure would simply not be able to perform their jobs.

The following provides granularity related to the development and operations units:
Full-time staff*:   31
Part-time staff**:  8
Total staff:          39
*  Defined as contracts permitting staff to bill up to 40 hours a week
** Defined as contracts permitting staff to bill less than 40 hours a week

We are asking for run-rate funding of $260,000 as well as a buffer of 25% to account for price fluctuation and continue building our compensation account. The total funds requested are $325,000.

Requested funding is as follows for the October 1st budget cycle:
· 1,706.00 Dash for core team compensation ($325,000 USD @ $190.5 per Dash)
· 5.00 Dash proposal reimbursement
Total: 1,711.00 Dash

Note: Should any funding remain, we will apply it toward future compensation expenses.

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Discussion: Should we fund this proposal?

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0 points,5 years ago
voting YES
0 points,5 years ago
Thank you.
5 points,5 years ago
@glennaustin, I think it's fair to say this breakdown of the DCG compensation proposals have left your critics (including me) with nothing to say. Thank you for listening.

Regardless of the reasons stated above, I would be over the moon if you were to continue like this. Since it has been done once, you've already done the hard work and created the template. Repeating this would be the easy part.

The breakdown removes much of the mystery from the DCG compensation budget, and this level of transparency can only increase investor (and prospective investor) confidence.

It also shows me that the majority of the funds is going to where it should go. Sometimes a startup consisting of only engineers realizes that to grow they need someone to manage the business, and through the stages of growth, the business begins to forget where they started, and begin to shortchange their engineers in favor of other departments, and in the end, the jaded engineers leave. I've seen it myself personally (but I wasn't one of the engineers). I'm happy to see that is not happening here, and I would love to have that reaffirmed every month, indefinitely.

Thanks again.
3 points,5 years ago
@unstoppable, thank you for the straight-forward feedback. We strive to be as transparent as possible, however, providing this level of granularity is not feasible going forward. We provided 5 reasons specifically why it isn't a good idea. The mechanism to vote for change on the granular level will be through the Trust Protector elections.
That said, I can promise that we have no plans on drastically changing the cost ratio of engineers:management in the next 6 months (until the Trust Protectors are elected). I believe that we at DCG are strongly aligned with the community on where the majority of the funds need to go.