Proposal “coreteamcomp101802“ (Active)Back

Title:Core Team Compensation: Admin (October)
Owner:glennaustin
One-time payment: 530 DASH (108930 USD)
Completed payments: no payments occurred yet (1 month remaining)
Payment start/end: 2018-09-17 / 2018-10-16 (added on 2018-09-08)
Votes: 577 Yes / 39 No / 1 Abstain
Will be funded: Yes
Manually vote on this proposal (DashCore - Tools - Debugconsole):
gobject vote-many c754dc7e25aeda60e257fbb658b587dc79589af5130e37edd16e72360d32fcfb funding yes

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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 (here)
2) DCG Comp (Administration): $100,000 (current proposal)
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:  https://www.dashcentral.org/p/core-salaries-201704
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: https://www.dash.org/forum/threads/dash-core-group-legal-structure-details.39848/#post-194362  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 DCG administration. This includes finance (2 staff), strategy (4 staff including 1 intern, product management, and data analysis staff), corporate (3 staff, including CEO, board member and 1 admin), and human resources (2 staff). We believe that all of these departments are essential for DCG’s operations to continue to run smoothly.

This is additional granularity related to the administration department:
Full-time staff*:   10
Part-time staff**:   1
Total staff:           11

*  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 $80,000 as well as a buffer of 25% to account for price fluctuation and continue building our compensation account. The total funds requested are $100,000.

Requested funding is as follows for the October 1st budget cycle:
· 525.00 Dash for core team compensation ($100,000 USD @ $190.5 per Dash)
· 5.00 Dash proposal reimbursement
Total: 530.00 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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-1 point,10 days ago
With all do respect to DCG, I do not fully understand why you need 10 full time members to do the administration.
Normal company's of your size either hire a external company, or have a small administration department.

Question:
Are you busing on optimizing this the apartment ? With the goal to decrease the staff size ?
Reply
1 point,10 days ago
Hi, the administration department consists of the following staff: "finance (2 staff), strategy (4 staff including 1 intern, product management, and data analysis), corporate (3 staff, including CEO, board member and 1 admin), and human resources (2 staff)".

We believe the size is appropriate for DCG and don't believe we should hire an external company to handle any of these functions.
Reply