GM!
By the time you finish this guide, you will have created your first DAO.
After a year of building on the edge of the space, we compiled all the information we wish we had while building our progressively decentralizing organization.
This guide has everything from for web3 noobs to experts. As the DAO space moves quickly, we are constantly updating this guide with new tips and tricks.
At Wonderverse, we default to taking action. So instead of this being a theoretical exercise, we encourage you to launch a DAO on Wonderverse while going through this article.
We have a lot to go over, so let’s dive in.
- What is a DAO
- What are the different types of DAOs I can start?
- Define what your DAO is going to do
- How to build your DAOs community
- How to set up a DAOs governance
- What are the best DAO platforms
- How to launch your token
- The ongoing maintenance
- How to work with contributors
- What is the easiest way to start a DAO?
What is a DAO?
DAOs are digital co-ops. They are member-owned and run projects.
The decentralized nature comes from their governance structures. DAOs use democratized voting for decision making. This separates them from a traditional corporation or non-profit.
Decentralized Autonomous Organizations (DAOs) have the potential to drastically change how the world works together.
DAOs are ubiquitous with cryptocurrency, but it’s a misconception that every DAO needs their own token or NFT to be a “real DAO.” As we’ll see later in this article, there are many ways to operate a DAO without ever launching a token.
Every DAO is unique. There is no such thing as a perfect way to run a DAO and every DAO operates a bit differently depending on their needs/mission.
What are the different types of DAOs I can start?
Every day, a new use case for a DAO is being started. It’s still day 0 in the space.
While there are infinite possibilities, let’s put in writing what type of DAO you want to start. This will help guide our decisions about governance structures, roadmaps, and important decisions down the road.
Here are some types of DAOs you can start.
- NFT DAOs
- DeFi DAOs
- Social DAOs
- Impact DAOs
- Startup DAOs
- Service DAOs
- Investment DAOs
- Community DAOs
NFT DAOs like the ApeCoin DAO where NFT projects collaborate with their community via a DAO. What might start as a NFT pfp project then turns into a way for the members to work together.
DeFi DAOs like dYdX ;lkasdfj (UPDATE)
Social DAOs are focused on the social element of the group. Think of groups like FWB (Friends with Benefits). Social DAOs often focus on IRL events and community building. You can start a social DAO around any interest or niche you can imagine.
Impact DAOs are the future of philanthropy. Like Elon Musk’s brother Kimbal Musk launching the Big Green DAO which is deploying capital to create food justice. There are DAOs fighting climate change, social injustice, really anything imaginable.
Startup DAOs are the hottest thing in the Silicon Valley now. Instead of 4 to 5 people grinding out 2 years, people are collectively starting companies with thousands of people around the world. Startup DAOs give them an instant community and distribution network that most startups can never get.
Service DAOs are collectives of members with a similar skill set working an agency model. Service DAOs might design your website, code, do community management, really anything is possible!
Investment DAOs are ways for members to pool together money to collectively invest. Investment DAOs provide better deal flow and accessibility to investing vs. traditional angel or VC funding.
Community DAOs are focused on community and participation as a collective and are not necessarily building towards a specific goal. They often form around a specific interest or shared identity. For many, community DAOs are actually unlocking more conversations and deeper conversations then they would normally have with friends IRL.
If your DAO fit nicely into one of these boxes, awesome. If it doesn’t, no stress! There are new categories and types of DAOs being launched everyday. Maybe you’re creating a new category of DAO. Try to put words around what the category is and that will help you make future decisions down the line.
Define what your DAO is going to do in 3 steps
Most DAOs are mission driven. It’s important to have a clear flag in the ground about what your DAO stands for, who it’s for, and what you want to achieve.
By going through these 3 steps, it’ll help us get a clearer picture of what you’re building.
Step one: Define your DAOs purpose
Create your vision, your rally call. Do you want to make video game building more accessible, or perhaps buy a sports team like Krause DAO?
It can be very niche like, “we want to feed 1,000 people who are houseless in Santa Monica.”
Or it can be aspirational like, “Build a Taco Bell on Pluto.”
You want your members to feel excited to be part of your group. Starting with a strong purpose will guide the rest of your decisions.
Examples
For ReadyPlayerDAO: The future of gaming is decentralized and permissionless, and this time, the players are in charge.
For Gitcoin: Build and Fund the Open Web Together
Step two: Define your DAOs goals
Once you've established a strong purpose, now you can set specific goals for your DAO.
On our platform, we call these "Milestones." Milestones are your first goal posts you set up to see if your DAO is tracking towards your core purpose.
If your purpose is to create the more engaged community of train lovers, your first milestone might be to get 10 highly engaged members into your Discord.
Small steps lead to big dreams.
Step Three: Create a project roadmap
Make your vision clear and you can do that in a roadmap.
This can be built with your community or you can do a rough version one before working with anyone.
Roadmaps can go through iterations. With a deeper guide on how to build a roadmap, don’t stress that it’s the end all be for what you’re doing. The keys to roadmaps is to break it up into seasons, have some big goals and things to keep you accountable.
Your roadmap can be a simple text document, a fancy landing page, or even a video.
You can be creative, have fun with it and make your vision as accessible as you can. This is a great way to get design contributors involved.
You don’t NEED a roadmap to start, and roadmaps change so don’t feel like you have sealed your destiny.
How to build your DAOs community
It’s time to demystify community building. Community is simple.
Community is a nebulous word for many people. The reality is, community is the most fundamental and natural human instinct that we have. Everyone feels a deep urge to connect and belong.
Your friendship is a ‘community’. The importance of community is the strength and variation of connections.
Having a community is like a basketball team having players. You need it to play.
One thing you should figure out is do you want to scale your community or not.
Your entire life you have been a member of communities. You’ve started some, rebelled against some you don’t like, but no matter what we found context and identity through them.
How to get your first 10 members.
How to break any cold start problem is to start with people you know.
So, start with some friends (preferably people who are interested in the topic). Go to some discord servers talking about your idea and see if anyone else wants to join.
Don’t be embarrassed about having 5 members, the reality is most of your favorite chats are probably group chats with close friends. Anything more than 1 is a party.
Have people you know and try to have them bring 1 friend, this should get you your first initial community.
How to get your first 100 members.
Now that you have some movement on your Discord, it’s time to expand. You can start a Twitter for your DAO and use it to comment on other people’s relevant threads. Find people in Reddit, find other people in similar Discords. Start spreading the word in 1:1 communication.
Posting on socials will help, just start getting the messaging out.
This will be one of the harder growth slogs. It’s more manual, but the people you bring in now is super important, it sets the foundation for your community.
Once you have a big group, it’s easier to get a bigger group. That’s the power of network effects. But once you pass this chasm, things will start to get easier. So don’t give up. If you’re doing interesting things, interesting people will show up.
At this size, you should be doing community calls and starting to collaborate as a community using Wonder.
How to get 1,000+ members.
To get to this size, it should be time to do a launch or pre-launch of some sort.
If you do a NFT drop or token launch, here you will get your big growth spurt.
Make sure to do good social promotion and you’ll be okay.
Your community can just 10,000 people in a single day if you play your cards right, on our initial token reservation we had 15,000+ people join our community in 72 hours!
Important notes on growing communities
Community size isn’t everything, it’s the motion of the community (!?! lol wtf)
We’ve written about whether you should even scale your community or not. Don’t let not having people excited and all in on your project stop you.
How to set up your DAOs governance
There are a ton of ways to set up your governance. This is one of the most important parts of your DAO. Are things all voted on, do you have a council/ how do you choose between these options. Let’s explore.
What’s beautiful about DAOs is you can design your dream governance. You don’t have to take the top down methods we’ve been handed.
First, what types of governance do DAO have/How should you decide how you want to govern?
This is something that is in the root of your roadmap an your vision.
If you want to maintain power in your hands for the first couple of seasons, that’ okay then you can progressively decentralize while metrics are hit.
Like dYdX who is planning a full decentralization as a protocol
But long term, what is the real vision for what you want to do?
You should be practicing decentralized tendencies throughout your entire product experience.
There are a ton of great governance options in this article check it out.
What tools can you use for governance
Snapshot is great if you have an existing token.
Wonder has proposals and both soft and hard voting.
You can also use jokeDAo which allows users to airdrop tokens on with voting rights. If you are pre token this is a great way to vote on chain1.
Mix and match
Don't be afraid to explore, the solution may lay in-between or some new idea that you might have. Just pick something and try, if it doens’ work you can alway update it later. At wonder we like to do trials as proposals. We had an onchain vote to try to post our discord more in public and it had a 1 month trial limit.
How to create a new form of governance
Web3 gives us new tools that other generations didn’t previously have access to. This means new outcomes and systems can exist that have never existed before. Many governance models use systems we have already known. So, you can be creative. Think outside the box if you want to have another form.
Some people vote with frickin' emojis. It’s all good.
What are the best DAO platforms
Next, let’s set up your DAO stack.
We’re asked very often what is the best DAO platform. Something beautiful about the web3 movement is that many platforms work together like Legos (you can connect and combine them easily).
There is no one stop shop for DAOs, as there shouldn’t be, the web3 movement is super collaborative and there shouldn't be one place where you can do everything.
Governance
Snapshot
JokeDAO
If you haven’t launched a token, this is a great way to do on-chain voting. You can create a custom “token” and drop it to select addresses.
We’ve run internal votes on JokeDAO and it’s a pretty fun experience.
Project management
Wonder, we’re biased but for a good reason. It’s a badass tool and has everything you need.
Wonder makes it dead simple to do work and payout your contributors. Even if you’re pre-revenue it’s super to easy to launch a DAO.
Raising funds
There are a lot of great ways to do this. Juicebox etc.
You can do a more traditional raise.
You can also raise from web3 vcs if that’s something you’re into.
This has different speculations.
Often it will be an official C-Corp with a relationship connected to the corp on some degree.
You can do token drops.
NFTs
Also great for memberships or product drops.
You can pay to mint them on mainnet, or you can do them via a L2 like Polygon.
Find someone to do the art in your community.
Or there are a ton of great pfp project people.
Official incorporations.
There is no box you can check on your taxes that say, I work for a DAO. Not yet at least.
The legal structure of a DAO is interesting.
There are way to incorporate in Wyoming which have some options.
You can also do a Delaware non board options which gives you legal protection
We’re not lawyers, however I talk with lawyers a lot lol, but it's good to have some legal protection for your group.
This will help with payments etc.
There are people who do incorporation in the cayman islands for you for a cool 20 to 30g.
I would wait on those.
How to launch a token
- Decide on token utility
- Decide on the right blockchain
People make the mistake thinking they need a DAO token or NFT on day one. In reality, launching a token is one of the last things you’ll do when setting up a DAO.
The ERC20 token will cover most of your basis if you’re launching on Ethereum.
We will give in-depth guides on token launches for you!
But understanding the tokens utility in the roadmap is the main thing to figure out, you don’t have to have the token ready to go before launching your DAO (don’t let that hold you up).
For token utility, you have to decide what your token actually does. This isn’t a small feat, and you don’t have to reinvent the token here. You can read famous white papers like x and y for inspiration.
Something to note is it’s important that when you launch your token, you are truly decentralized. The legal ramifications if you’re not are the SEC can make a case that you’re a security. Meaning you’re doing something to increase the value of this thing. In reality, that would make you an issuer which is not a good thing to be in court for.
So do your due diligence and consult lawyers when doing a token swap. There are a lot of specialists at this point with these things. But make sure you playit more conservative if you can.
The ongoing maintenance
The DAO will take on a life of its own. You will learn, have fun, try a lot of stuff and some of it might even work.
We want to help you have that dream come true, so use Wonder.
How to work with contributors
Many people are making a good living from solely contributing to a DAO. There are a million reasons why people want to contribute.
Through Wonderverse, you can collaborate with your community.
Just create a project, set milestones, and you can do everything from setting goals to doing your payments.
What is the easiest way to start a DAO?
Start a Discord server and launch it on Wonderverse
This is the best way to start. In the same way you don’t have to be an incorporated company to start working on a startup idea, the same is true for a DAO.
You don’t have to have governance figured out, a token, and all that jazz to start a DAO.
Just start.
Get the project moving, and you’ll figure the rest out.
You can launch a DAO on our platform now in under 2 minutes, here's an article on how.
I recommend you launch your DAO there to get some skills going.
And there are 1,000,000 things we still need to get into. Make sure you subscribe for more info on web3.
Onwards
This might have felt like drinking from a firehose, so please bookmark the page for future reference.
And if you found it inspiring, please share it with any friends who might be interested in starting a DAO too.
