infinite time horizons, traditional jobs conversion into grants, and the future of mergers & acquisitions with shreyas from llama

Welcome to the Armada Podcast, where we are focusing in on DAO governance. Let's hop into the show. If you could start with who you are and what you're working on.

Hi, I'm Shreyas Hariharan, and I am the founder of Lama, which helps DAOs manage their treasury. We are basically working on a treasury management as a service for DAOs. So we help DeFi protocols and DAOs with problems relating to Asset allocation, spending, reporting, budgeting, as well as you know specific sort of treasury analysis tailored to a DAO.

And and when did you start working on it? Like like when did you actually launch it? And then what inspired you to start working on that?

Sure, I started working on it in October 2020 last year, and it started off as a. Reporting tool where basically I was helping Brian Flynn actually with Jam, which is this social token community he launched. And I was helping manage the treasury there. And I figured that there wasn't a good reporting tool out there in terms of just something better than Etherscan where you can see what's happening with the treasury, categorize expenses in useful ways. And I asked around and tried to find tools and I couldn't. And so the first thing was building out basically a simple reporting tool where a treasury can log in and then categorize expenses in useful ways. And as I continued to work on this, I realized that the problem is much bigger. And also, you know, the pressing need right now probably resembles services. And so helping treasuries think through asset allocation and, you know, what, you know, how much should they have in stablecoins? How should they go about diversifying their treasury? You know, what else can they do with their treasury, especially when these are larger pools of money? Like, how do you actually use the treasury to to achieve the goals of the protocol. And also other issues relating to if you want to have more core contributors be paid from the treasury, how do you actually structure those initiatives? And yeah, so those were the type of things I later realized were important problems. And I got to work more closely with projects like Uniswap and Aave, a few others. And yeah, then slowly grew Llama into a group that basically we help DAOs with treasury problems they need. And slowly we'll productize some of those elements, but are really focusing on really whatever treasury issues that the DAO face and want to build out sort of granular templates on how to solve each of them.

Super big fan. I think you're going after such a key leverage point that I've observed of saying, these treasuries have grown quite large. And I know it's something you've written about and talked about. And how do we deploy that in a really efficient way? And something that I've thought a lot about coming from the Web2 Silicon Valley kind of startup scene is that this idea of, you know, you raise roughly 18 to 24 months of capital with the intention of burning all of it to scale the organization and hopefully getting hypergrowth. I feel like DAOs have an entirely sort of different approach, but almost in some cases, some of the DAOs are almost too conservative to be able to achieve their visions. And so I'm super fascinated with the work that you're doing to sort of bridge that gap of those 2 worlds, which we have questions to dive in on exactly that balance. Before I go too deep on that, which character or person would you like to have dinner with?

Yeah, I think my answer to this would be David Deutsch, who wrote this book called The Beginning of Infinity, which probably is the most influential book that I've read. And, you know, the idea in that book is basically that we are and always will be at the beginning of infinite progress and that anything that is, you know, that isn't impossible according to the laws of physics will eventually be possible with sufficient knowledge. And I read that probably 3 or 4 years back and actually read it again. And I still probably don't understand 30% of the book. He goes through like all sorts of fields from mathematics and physics and biology and history, culture. And I think that idea has sort of repercussions both like, again, like sort of in epistemological sense, but also like personally, I think it's really been ingrained in my mind and has affected me. So would love to somehow jam with David to ask him a few questions that I have from that book. I've sort of Gifted that to a bunch of friends and family members. And yeah, would love to talk to him, I think, about his views on optimism and the other topics.

I quick checked my Goodreads queue and I was delighted and a little mortified too that I have that book on my list, but it's kind of buried in my queue. So I slid that up and I certainly want to give it a read and hear that. That's an interesting answer. How do you see DAO treasury evolution playing out? And just for disclaimer for our listeners, you wrote a very long, lengthy article on Bankless's publication, which I will link in the show notes. But if you could kind of give us a kind of summary of that, and then I kind of have some follow-up questions as we kind of dig down that rabbit hole.

Yeah, for sure. I think the first thing is to start off with what do you want to do with the treasury? What's the goal? And there are some similarities, I think, across projects, but there might be differences based on how a protocol or DAO wants to even approach their goals. And the way I think about the principles to start off with is one, to maintain an infinite time horizon. And why this is important is this would affect how you think about spending and asset allocation. You could also have a model where the treasury gets dissolved within a certain number of years. But to do that, you need to have enough public goods funding mechanisms that exist outside of these treasury assets, which can happen for some projects. Like I think Ethereum, you could imagine that it's not as dependent on the Ethereum Foundation as, you know, like you could basically have Ethereum is that important that sort of you can have enough public goods funding to support core development and other things. But it's hard for every protocol to reach that state, though it's possible. And it's better to plan, I think, for an infinite time horizon. The second one is just for inflows to exceed outflows and to make sure that any revenue from the protocol as well as the treasury exceeds spending over the long term. And the third is just maintaining sufficient diversification. And the goal of that is just to ensure that even if there's a big drawdown in markets, you can still do whatever you want to do, whether it's fund core development, increase, you know, your marketing spend, or, you know, provide certain incentives that will be probably more important in a bear market. All of those things that I think can be used to a protocol's competitive edge. So I think starting with those principles, I'd say the way that treasury management evolves is right now one of the focus areas has been on the diversification over the last few months and just making sure that DAOs have some portion of their assets in stablecoins just to cover a few years of operating expenses at least. And the way that a lot of them have done that is by capital raises through strategic partners. But, you know, there's also other ways like doing a Gnosis auction where, you know, it's, you can do it fully on-chain and trustlessly and sort of programmatically and execute that. You can also, you know, do token swaps or you can, there are a bunch of things on the option list of what, how to start diversifying your treasury. But I think having in terms of diversification, having some stablecoins is, is a good start. And then the other thing you're seeing with Uniswap, Compound, and Aave is this, you know, focus on grants programs. And I think, I think grants programs actually much have a much bigger vision than most people think and appreciate, because typically you have these grants programs or hackathons funded by companies or, you know, different projects. And that's not, you know, that serves a useful purpose, but it's not a core part of what that company does. Versus if you see what a DAO treasury, like Uniswap's treasury or Aave's treasury or Compound's treasury, they're basically spending nothing except the grants program. So the grants program is almost this route to building this ecosystem of developers and DAOs and subcommittees and this thriving ecosystem and of culture that can help contribute to the protocol and give it sort of, yeah, give it its competitive edge. And almost, it's almost a different way of recruiting, I think, where I think the grants start off to attract a bunch of code contributors attract a bunch of contributors. Some of them would be one-off projects, but then maybe some of them result in things that are built on the protocol, maybe things that the protocol can itself fund. Maybe, you know, there's a really cool project that emerges from Aave grants that, you know, we can actually, you know, the Aave treasury can invest in later. Those templates haven't been built yet, but I think grants could, the grants programs are, you know, which are just starting off right now, could be— be very useful and, and, and grown in size much bigger. So those are, those are a few things I'd say. I mean, the, the, like you said, the, the article I wrote was, was long, but I think the, the V1s are that of what's being done with treasuries right now are grants programs and, and some diversification of stablecoins. And I think it, it's, it slowly expands to, you know, a lot more that you can do with these treasuries. But I'll, I'll stop there and then. See if you have any thoughts or questions on that.

Yeah, there's 2 questions, and one is sort of in the stablecoin strategy, and then the other one is around this grant one. And I'll go into the stablecoin one first. So I made this comment before of sort of this Web2 Silicon Valley startup mentality of saying, hey, raise a few million dollars, expect yourself to burn that over an 18 to 24 month. It sounds like a little bit like The way that I'm hearing you describe this strategy of moving over some of the treasury into stablecoins is almost to build a similar strategy of saying like, okay, let's move 2 years roughly of funds into the stablecoin so that we have sort of this operating space to go achieve our vision. And then the rest of the tokens is almost like sort of the equity back into the organization. Like, am I drafting too hard into the Web2 world and trying to map that on the Web3? Or is that a fair analogy?

I think that's a fair analogy to start off with. I think the, you know, you don't want to have sort of the whole treasury, especially if it's in hundreds of millions or billions, just in one especially volatile asset. I think it just is just some basic financial prudence to Have some of that in stable assets or basically something else that's less correlated. But stablecoins, of course, is the best option available to start off with. And yeah, so I think that the traditional company parallel is a decent start. I would say that it's still TBD in terms of how much contributors— I think recurring expenses should probably happen in stablecoins and you should have you should have like a vested component in protocol tokens. So far, at least in the bull market, a lot of contributors want to get paid in tokens. And so the exact comp structure I think is still being determined. But I think ideally the way you design this is you have enough stablecoins that you sort of map out all your expenses and you have some core expenses come, recurring expenses come through stables and then a vested component coming through the protocol tokens. And you can have like separate, like an operations account and an investment account. So, you know, you probably put some, you could put the stables to productive use and maybe have some like sort of higher yield earning strategies, investment account, and maybe the operations account, keep it very simple or not even deployed in any lending protocol. So yeah, those would be just a few additional things I'd add.

Yeah, it's, it's, I appreciate you kind of fixing the finer edges of the analogy. And that's part of the reason I put it out there. And it's a super helpful framework. And I think obviously, you know, we would probably be remiss not to at least mention the price drops that has happened over the past few days. And I do think it is a really interesting thing of like, how does compensation look like in a bull market versus a bear market? How does that change maybe the ratio? But I love your thinking of sort of like this, you know, this operational chunk and then sort of the equity or the upside vesting through the token. That's certainly what resonates with me is just sort of coming as an outsider into the space that feels like the most efficient blend. But as you mentioned, like still being sorted out.

Yeah. And I mean, I think the price drop right now is a great example of why some portion of the treasury in stablecoins would be extremely useful just to continue doing what you want to do. Because otherwise, let's say you have a budget of a few million dollars a month that you're spending on core expenses. You're basically just giving away a lot more tokens, which is fine. If you're giving it to the right type of participants, it's fine. But you don't want to not have the option of of, of, you know, giving away these stable assets as well. And the, I mean, the other, the other option is also to, these, you know, these lending systems haven't been fully built out yet, but like, but yeah, if, if a protocol can maybe deposit some governance tokens to get stable assets in return, and if, you know, at the right interest rate, it makes sense to just, you know, fund some certain types of expenditure in borrowed stablecoins. And so you don't sell those, you don't liquidate the stablecoins in your treasury, but you just borrow some and you fund like a specific type of expenditure that at the right type of rates, it would make sense to do. Or if it's a fixed rate product, it would make sense. Those are just, you know, another thing, another option I think on the table that is, yeah, I don't, I don't know if it's like with the, it has the liquidity needed for some of the larger treasuries yet, but like definitely will be built out.

It struck me as you talked about this infinite time horizon for the DAO operation that I've run into different school of thoughts through this podcast that DAOs are somewhere in the kind of medium-term optimal deployment world. And then I've talked, run into this other world of thoughts where like DAOs are, you know, the new way of organizing just about everything. So my question is a little bit two-part. One is, how important is an infinite time horizon? And then the second one is, is that importance tied to the idea that DAOs should exist as kind of the de facto structure of human organization for the foreseeable future, as opposed to a more niche or specific category of DAO application? Does that question make sense?

Yep. That makes sense. I'll first actually talk about the infinite time horizon. I think it's, yeah, it's important for me to caveat that most of what I was talking about so far and probably will talk about is referring to protocol DAOs. And so these are, you know, specific type of DAOs that, yeah, that, you know, that there's, at the core level, there's a protocol and then the the DAO treasury, you know, has some protocol tokens basically in, you know, in the treasury. And so it's in that context. And I think protocol DAOs can, should, most of them at least should think in terms of an infinite. I think there are definitely a bunch of pop-up type DAOs that probably is a long tail. Like there'll be a bunch of projects like, you know, someone wants to bid on a certain NFT and they can't afford to do that. They can, you know, just with a few clicks of button, like if potentially be able to, uh, combine their bids with, uh, you know, 50, 100 others and, uh, buy this NFT. I think Please the DAO did that, and, uh, Please the DAO I think continues to exist and buy more NFTs. But, you know, you could also have a situation where it's just a pop-up DAO that exists to make this one purchase, and then, and then there's a, there's sort of a distribution liquidation mechanism and they, they, uh, they leave. And So, so yeah, I would sort of caveat that in the beginning. And then I think, can you maybe just rephrase the second one? Or I might have forgotten, like, so are you, are you thinking? Yeah, go ahead.

Yeah, I think, I think you answered the, the second one indirectly by answering the first, which is, let me play it back a little bit, which is, you know, when you're talking about a lot of this thinking, it's at the, at the protocol DAO world. And so what I hear in that is that an infinite time horizon is much more important because a protocol by definition is, is a protocol, right? So it's a much more infrastructure component of the future world. And so those DAOs, I think, by definition have to be longstanding and exist kind of almost similar to the way that we think about nation states today, of sort of like there's this existence over a long period of time. Whereas there's some of these creator DAOs, and like you talked about NFT purchasing, and like all these things that— you use the word long tail, which I love, which is like there's these long tail use cases that are going to pop up and go away. And I think that I'm realizing as I kind of painted that picture of this distribution between 2 modes of thinking, I'm realizing I was thinking about it as a path between A and B. And really, it's more probably a bimodal distribution or the long tail. Talk a little bit about the importance of that infinite time horizon for those protocol DAO treasuries, which is when you expand things to infinite time horizons, I think the stresses on the system become obviously much, much larger, right? Even thinking about having a protocol exist for 100 years versus 1,000 versus 10,000, is just infinitely different than thinking about it for infinite time. So like, how does that all merge together in, in sort of a pragmatic, like, what do we build today type perspective? Does that question make sense?

Yeah, that's a great, very interesting question. Um, so I think, um, once you expand the, the time horizon by that much, um, the way that anything sustains is when you have these elaborate systems in place, right? Any organization is an attempt at expanding time horizon. So if you think of me as an individual doing XYZ things, I mean, I could sort of do it and be very productive and successful, but the limits are, one, I'm going to die. And then two, unless there's some longevity research that prevents me from dying, but I'm probably going to die and then I'm not going to pass on my knowledge and my systems to someone else. So maybe one way to prevent that is to get someone else. And then, you know, of course, the next level is, is passing on by progeny. Like, for example, actually some of the largest, longest running companies, interesting side note, there's research done by Long Now Foundation. Some of the, some of the longest running companies actually from Japan, where these like family run groups where, where, you know, families actually, you know, expand the time horizon in the sense that The kids are not going to kill these businesses because there's sort of less of a likelihood for them to do that. And I guess these are smaller, but still, they've been running for like 500 years. But anyway, I think any institution, whether it's a foundation or a company, expands time horizon. I think a nation state is a more significant version of that because why would you set all these processes in place? Why would you have a constitution? Why would you have a structure to separate the 3 branches of government? These are pretty elaborate things that you won't want to do unless you think in terms of a very, very long time horizon. You want to have processes to change that, but you don't want to— the reason why you don't want to do it half-assed, even if you have people who are really, really smart to do the first 10 years of leading the nation state, You still want to set those processes because that's what gives the optionality for this thing to exist for a long time and to have more than what it can without these things. So in that context, that's sort of why expanding the time horizon is important because you— I also like the parallel that you drew from a protocol to a nation state. Also think about that. I think if you think of, like, as I'm working on Aave grants, like, you know, eventually you want to, the way that recruiting will happen is a little different from companies where, you know, it's going to resemble a nation state in the sense that people just, there should be some processes to do certain things in a nation state. Like there are certain rules, like you can't do this, but you can do this. But within that framework, people should just be able to come and do whatever they want. Like they should be able to come, like start a shop and like, you know, earn revenue for themselves and some goes to the state, whatever. Some, some type of system that benefits the state but benefits them. And you want Aave protocol, Uniswap protocol to also have these systems where people are able to seamlessly come and like sort of contribute to the protocol and, and, you know, in a way that benefits them, benefits the protocol, and then leave without having like, you know, a company type recruiting. And so that's going to take some time to build out, but that's, that's also a You know, one way of thinking of this long-term horizon, you can of course do it the traditional company way, but that limits the upside optionality, I think, with any of these things. And now the connection to the book. So one of the ideas in the book is that anything that isn't impossible according to the laws of physics is possible with sufficient knowledge. And I think that principle sort of applying it to what these communities and tokens are, like, we're still discovering what tokens are like, you know, it, the valuations of these tokens can't be justified, I think, just by discounted cash flows of the, you know, the revenue that these things generate. I think there's something else going on. I think the ultimate moat is community and basically kind of like the nation-state equivalent, which is, which is You know, product market fit and the product and the usage is like a route to building the strong community, but it may not be. And in some cases, a strong community can actually manifest into building all sorts of things. So for example, like I'm involved with FWB and Nama is actually helping with their treasury. And you know, I could see FWB like evolving into something way more than it is right now. Right now it's like a curator DAO and it has like an active group of people in the Discord. You know, who knows? Can FWB start a DeFi protocol? Maybe. I mean, they're not at all working on that now, but like basically if you gather a bunch of people together, it's, it's sort of like the American story, right? You gather a bunch of people together in this, in this space and you have some incentive structure and you, you know, you, you have this sort of right elements of different things. Who knows what can happen with it? Like you really don't know. And I think the token is like a bet on that optionality. And, and, and so yeah, back to, you know, David's point on like anything that's not impossible is possible. Anything that's not impossible on laws of physics is possible. Like you, restrict what Uniswap can do and what, you know, can, can Uniswap just, um, actually acquire physical territory? Uh, can it, can the community treasury like sort of do that? Can, um, can these projects like, uh, sort of, um, you know, can a decentralized exchange actually get into lending and, and sort of have some interesting collaborations there? Uh, there's, you know, it's like a very open space and the, the The only way you can do all those things is if you can think with that infinite time horizon, because otherwise you really limit yourself. And it's fine. Again, there's going to be a long tail of these projects and it's fine if most of them really don't achieve that or even want that. But then I just think that there's going to be actually a substantial amount of other projects that can think like this and want to. that'll have this interesting optionality of, of what we have not seen yet. We already don't know what building public infrastructure on the internet results in. Like, it's, it's an experiment.

It's— I totally agree. It, it, when I think of this long tail, like, I certainly think of like a power law distribution into the long tail, right? And so I think what you're getting at is like, you know, the, the protocols that are thinking about the infinite time horizon that are having success, you know, there's gonna be a power law distribution of their impact. And so some of these DAOs, you know, while they may represent maybe the average DAO, may not represent sort of the power of the DAO structure. And I think that's kind of a— it's an interesting kind of way of thinking about how to talk about these DAOs, because there's, there's a significant difference between, you know, the average small business in America and like Apple. It's like, it's like, it's not really even worth using the word business really to describe Either of them. And so I love your point, though, about how a lot of the investment here at the token level is speculative. I mean, that's part of saying like, hey, this smart group of people all come together. And like, again, thinking of Silicon Valley, you know, Bell Labs and some of the semiconductor companies, it's just like, it's a bunch of smart people working on things, right? And now there's a mechanism to put money into that, to want to either help with time and energy or through capital and be supportive of that. And so we are kind of seeing this new parallel. You started drifting a little into the exact next question that I wanted to talk about, which was this idea of thinking about jobs. And you touched on it earlier with sort of this grant process. And I think you made a comment of like, hey, you have a grant and then you have this ability to sort of research or, sorry, recruit people through that grant process that fit really well into the DAO's kind of vision. How do you think about how we'll see traditional jobs existing in DAOs into the future?

Good question. I think first there are some bottom-up, more bottom-up DAO structures that actually don't need these grant programs. So for example, Yearn is a great case study of, you know, bottom-up contributors paid from the protocol, from the Yearn treasury and, you know, already just contributing in different ways. And then retrospect— retroactively, I guess they they design the structure, the wide team structure, and they find a way to more systematically pay and reward people. And on the other side, you have protocols again, like Uniswap, Compound, and Aave to some extent that, you know, have a core team that's been paid, you know, that's centralized and paid from another pool of assets. And then now the, you know, the attempt is to get more contributors from from the protocol treasury. And I think grants programs are a great way to do that. But, you know, it's not needed for, it's not as important, I guess, for like some of the other groups that have really, really strong bottom-up structure. Now, in terms of traditional jobs, like, so why I think grants are important first is because it's just very hard to expect people to Most people to just you know go to the governance forum and yeah, just pitch something they they you know they want to do. Or it's one it's it's it's sort of public. They don't know what to pitch. Like this is is like not clarity on what the protocol wants. And so grants programs I think are somewhere in between where they offer some structure. There's a process. There's a simple process where you can apply. It's not you know if you get rejected, it's a private rejection. There's a way that But there's some RFPs listed, so you can attempt to build certain things that the protocol clearly wants. You can, of course, chat with people who are on the grants committee to get feedback to basically as a way to interface with, rather than just sort of going to this public governance forum and it being sort of doing some doing some work upfront and not knowing whether you're going to get paid for it, you know, things like that. So I think grants programs are useful in that sense. And I think people find it useful to have this structure. I think you'll slowly have people recognize that grants actually, programs actually want to fund a lot of activity that benefit the protocol. And you, as an individual developer or even like, you know, working on say treasuries or something else that you can, you can actually serve multiple protocols and do really useful work and never sort of be, you know, full-time contracted or anything. But yeah, just, you know, make a decent living serving different projects and continuing to find opportunities as you build a reputation there. I think what you're going to have is you're going to have that, like this whole process of like, you know, almost projects and like one-off things and, you know, consulting type stuff or like, you know, whether it's people, you know, building one-off things or, or, you know, sort of someone doing an analysis or like, you know, baking, making dashboards for Compound, let's say, you know, things that, that start off one-off, I think can have that thing of, yeah, you, you start off with that contribution and then, you know, We'll see like if if there's if there's some need for a core recurring contribution, then then there'll be a pathway. I think that maybe grants programs plus like other other groups within these larger protocols like sort of help determine. So for example, in Aave, we are funding or you know we we want to seed and fund a risk committee or risk DAO that that basically does. Risk analysis on asset listings and on, you know, does some sort of legal analysis on what, you know, how, how these new assets affect the protocol. And, you know, to like initially it'll start off as like we'll, we'll like have someone apply, like, uh, that person can recruit the necessary people and then we'll, you know, test this out with one or two projects. And then if it goes very well, then, you know, eventually that, that group should have more autonomy on getting a budget and then deciding how that's spent, whether it's like, you know, paying Gauntlet for a specific risk analysis or, you know, hiring an external person. That's how some of the more traditional type jobs, I guess, can emerge. So I guess my TLDR would be that jobs in DAOs start off as like just contributions and, you know, you sort of do things that are one-off that the DAO needs, whether that Can take the form of like responding to an RFP on a grant, or it can take the form of you're already active on the discourse or Discord forum and you just do something. And then that could be a pathway if you want, and if the DAO wants for a more recurring type permanent contribution or for you to be connected with teams or other individuals to continue to build this into a more meaningful longer-term relationship.

Yeah, I think that's super interesting. Like, the— I wrote about this newsletter— is this idea that humans, I think, with the idea of loss aversion, how people traditionally think about work and jobs and kind of society, I'm super interested in this transition to get, you know, super talented developers that perhaps have zero or a small amount of experience in this Web3 space, It's like, how do we bring them into this world to start contributing in a safe way that kind of addresses the psychological need of loss aversion that I think traditional jobs solve, kind of like bringing that floor up so that there's sort of this like, okay, I can, I can go into this world and I can generate this much value. And I just see with the Web2 world, you know, these mega corporations have extracted so much value by Putting up really high floors at the end of the day, and then obviously fairly low ceilings depending on the role, but traditional equity to any engineer at a big organization in general is really not that big in the big scheme of things. And so I kind of see this like high floor, low ceiling. And then I think in the Web3 space, I see sort of this opportunity to— well, right now I see a low floor and a very high ceiling. And it's sort of like, how do we make those 2 worlds kind of migrate is something I'm really thoughtful of, to try to really accelerate Web3 to kind of this next phase. How do you think about mergers and acquisitions in the DAO world in the future? Is that something that'll be commonplace?

I think we'll have less M&A, much less M&A probably than there is in the traditional company world. And I think just the nature of open source protocols lead to, what is even an acquisition? Like the code is public, like the, you know, sort of the thing, what you are doing is you want the community and you want all the collaborations that come with the community and the relationships and stuff like that. So I think what's— what'd be much more common is different types of collaborations. I do think you'll have some M&A, but I think what'll be much more common is different types of collaborations that may start off as, you know, just in some cases like asset listings in different protocols or, you know, working on a sort of project together, communities collaborating or like, you know, token swaps is I think a way to formalize it a little more where it's definitely underutilized now where, you know, if you, if one protocol treasury has the token of another one, then you're really forming an alliance because you can, you could sort of get things through governance because it actually benefits both for something to go through governance versus if you just didn't have that token. So things that could be self-serving can actually be posted and voted on and passed because of these alignments and token swaps. So I'd say that would be more common, though there is scope, I think, for some M&A in terms of like, if, like, for example, a DEX wants to get into lending and then, you know, those collaborations are harder. Like, you know, maybe you, maybe you can pay a certain premium to the token holders of the lending protocol. And, and it would be interesting what an on-chain negotiation looks like when it's, or what a public negotiation looks like when token holders are just saying things on the governance forum. Of course, some things might happen through backchannel, but like ultimately everything has to be discussed in public. So yeah, one of my thoughts is actually you might, if there's more of this activity, you might see some— sort of specialized M&A advisory groups that can actually help coordinate what valuations look like, what way to finance these acquisitions, whether it's through debt or tokens or stablecoins, actually negotiate and negotiating with governance because governance at this point at least requires negotiating with large stakeholders. So it's actually facilitating that. And then executing what a merger looks like, actually Sort of merging the relevant code. You know, what is you know what does that community look like? And yeah, so those are some of my thoughts. So to summarize, I think you'll have many more like both collaboration and competition. But then you know maybe some of it results in M&A, but it's just not. I don't think it'll be as common as it is in the company.

Yeah, I certainly agree with you that. And I think it's something hard for people to wrap their head around, A, with DAOs sort of emerging as this new thing, and then B, having been in a bull run for so long that, you know, I don't think it's a very bull market type activity. It's probably going to be something where some protocols are very much struggling or maybe the community has left. And like, to your point, like there's some really kind of strange situations that might emerge. And with it all being, you know, open source as well, like, to your point, like, maybe it just doesn't make a ton of sense. But I'm super curious to kind of watch how some of this plays out.

Yeah, that's a great point. I think the— sorry, I think the, um, the point on, like, sort of buying things at deep discounts could be quite interesting. Um, yeah, would have TBD on what exactly you're buying, but, like, I think that could definitely be something that treasuries that are well capitalized can have the power to do when they see these, like if there's a, yeah, there's a bear market, if there's a particular exploit, but they know that it's a one-off thing.

Yeah, there could be, I think, some really powerful situations that I'm not educated enough in that could be some amazing opportunities for some of these larger protocols to acquire some of these dead or near dead protocols or any DAO for that matter. But what strikes me also is really interesting is that typically in the Web2 space, you're going to have this vesting process of 2 to 4 years, maybe longer, of taking this knowledge and expertise from the former founders and early team and bringing that into your organization. And so thinking about your grant world too, I mean, there could be even like a grant acquisition process to be like, okay, we're going to go in and we're going to buy these tokens at this price. And then here's all the grants that we're going to put out in order to accomplish whatever the merger and the acquisition looks like. And like, there could be some really cool creative things that I've never really thought about before that— Yeah, that's interesting.

It'd be interesting if it happens through the grants process where, yeah, someone, yeah, like there's an initial proposal put out there and then like all the things that need to be done for the merger to happen and be successful. funded by the grants DAOs. That'd be—

I've been thinking a lot about this idea of doing token swaps between DAOs, and I think on one hand that feels like exactly what DAOs that want to partner together should do because it's, it's really simple. It, it very much aligns incentives very quickly, rapidly. But there's this other, other part of me that sort of thinks that that's like a first-order solution to partnering. And so I'm just kind of curious on your opinion of like Is that this really simple, amazing setup that just really aligns incentives super well for, for both DAOs that are doing some sort of token swap? Or do you imagine that there's going to be more complex arrangements and alliances and partnerships that will emerge through entirely different things?

Yeah, I think it can. It's definitely an initial thing and also totally depends on, you know, how— what portion of the treasury is in this other DAO's tokens. It could be also really insignificant. In most cases it will be small, but it could also be extremely small, in which case maybe it doesn't make that much of a difference. But I think the token swaps are, you know, should be this route to more collaboration between the actual communities of these different protocols. And so Like, you know, actually getting projects sort of built from one protocol and the other, actually basically increasing the pie in different ways and maybe getting the other protocol contributors to apply and get grants in from your protocol DAO. And yeah, I think if it doesn't accomplish some of those community contribution things, which is Which is ultimately like the main contribution is scarce and there's scarcity of contributors. You know, there's much more abundance of capital, but you, you know, any of these capital-moving things should lead to contributions and collaborations in these different groups. And if it doesn't, then yeah, then You know, it's like it doesn't hurt, but it's like maybe it helps a little bit with the treasury diversification, probably. But overall, it's like a it's a neutral thing. But I think the power of it is is you you know you get let's say Gitcoin and Radical. You know they both mutually benefit, I think, from some type of collaboration because they have you know very similar goals in terms of. public goods funding and just how public infrastructure should be built. And so having that in place is a cool way to almost instantiate things that the communities could do together. So yeah, basically if the end state is you have these 2 groups almost be, yeah, like form this very, very strong alliance that they can be there in, you know, if there's a smart contract exploit for one of these protocols, then the other one will step in and really help out. And you see Yearn do this for a bunch of groups that really helps, you know, build their sort of reputation and their, I think, almost their moat more because, you know, they're having these different communities That would be that for them if something happens to you. And so yeah, I think the token swaps are like means to an end. It's not it's not a sort of end state.

Appreciate you going down all these rabbit holes with me. Thanks again for your time and joining the show. If you could remind people where to check out your work, and thanks again for joining.

Yeah, for sure. Really enjoyed this conversation. I am on Twitter at Hello Shreyas, and and I run Lama. And, you know, reach out to me if you have any questions on treasury management. And we're also looking for people to actually help with DAO treasuries. So feel free to hit me up if you have any experience or interest in that space.

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