The article below outlines my journey analyzing, learning and eventually joining GCR DAO. I hope this article is helpful to those looking to join, contribute or create a DAO. The memo below covers the following sectors: Summary, Product Market Fit, Market Analysis, Competitive Landscape, Governance and Tokenomics. Read on!
https://globalcoinresearch.com/
Description: GCR is a research and investment DAO focused on Web3. $GCR is the native token of the DAO. By holding a set number of $GCR in your crypto wallet, community members are able to enjoy and participate in various events, investment deals and resources.
Sector: Investment, Media DAO
Token Price: $1.3
Value Proposition: GCR provides value to community members through their novel token-incentivized media farming strategy, unique dealflow opportunities and community building.
Target User: Crypto-native independent investors (Crypto-bros?) looking for great deal opportunities and exposure through the publication of their written content
Product: What offering does this DAO provide its members? What benefits are included with membership?
The product of this DAO is access to different community features token-gated by tiers. There are four tiers to membership in the GCR community:
Price: 0 $GCR
Perks:
Research and Content on GCR site
Weekly Newsletter and Updates
Educational and Research Calls (Public Events)
Virtual and IRL Community Hangouts Around the World
Ongoing GCR Campaigns (earn $GCR tokens and free memberships)
Price: 100 $GCR
Perks:
Tier 0 Perks
Access to All Community Investment Calls
Governance Discussions
Price: 700 $GCR
Perks:
Tier 1 Perks
Access to Investment Threads and Discussions
Sponsorships and Complimentary Pioneer Referrals
Price: 2000 $GCR
Perks:
Tier 2 Perks
Guaranteed Investment Allocation
Monthly Airdrops
Deal Recap Calls
Participate in the Exclusive GCR Angel Network
Discord Community Size: 6284 CAPTCHA Validated Members
Newsletter Subscribers: +30,000
Ammount invested: +$31M
Additional statistics from GCR 2021 performance reports:
To date, GCR members have had access to 120+ crypto and non-crypto investment opportunities at various stages including pre-seed, seed, liquidity mining, growth equity, and more
GCR members have directly met over 100+ founders through our investment deals, AMAs sessions, and ongoing events (digital and IRL)
GCR Investments On Average Have Seen Returns of >40x***For projects/companies that have become liquid/marked-*
As of August 2021 (GCR DAO was 4 months old) $GCR Members had Cumulatively Committed in Capital
$800k+in Pre-Seed and Seed Rounds
$5mn+in Liquidity Mining Rounds
$20mn+in Growth Equity Rounds
As can be seen from the statistics above, GCR DAO has shown strong signs of traction, with its large newsletter following, DAO membership in the thousands and average investment returns over 40x on projects that became liquid. With their core media farming strategy and ease of joining, this is only the beggining for GCR DAO.
Growth in the size and number of web3 VC investments
According to the Web3 Investment Trends Report, 2022
2021 saw a total of 2000 deals worth over $33Bn (x2 that of 2020)
The web3 market is projected to grow from $1.23Bn (2020) to $8Bn (2030) at a CAGR of 45%
Most of the deal sourcing is happening over social media. Below you’ll find the top platforms where VCs are sourcing deals
Twitter - 26.6%
Telegram - 13.3%
Crunchbase - 13.3%
InnMind - 6.7%
53.3% of Web3 VCs surveyed take 2-3 weeks to make an investment decision after the first call with founders
20% of VCs surveyed take 1 week
13.3% of VCs take more than a month
86.6% of VCs surveyed invested below the $500k ticket size
As can be seen from the trends above, investments in the web3 space are growing exponentially, deals are being sourced from unconventional means, deals are closed much faster than traditional VC (2-4 months).
Increased need for web 3 native value add
According to Chainlink:
The key value adds web3 founders are looking for are:
Guidance on equity distribution
Guidance building an open-source community
Access to wider networks
Access to commercial and operational experience
“Joining an incubator program or founder community oriented towards web3 founders is essential to funding early stage web3 projects”
In order to properly understand the potential of this opportunity, we need to consider the following assumptions.
The [Global Asset and Wealth Management Industry](https://www.globenewswire.com/news-release/2022/07/01/2472808/0/en/23-3-Billion-Global-Web-3-0-Blockchain-Market-Growth-with-GAGR-of-41-6-2022-2028-The-Benefits-such-as-Improved-Privacy-Secure-Network-Driving-the-Market-Web-3-0-Market-Growth-Size-.html#:\~:text=According to our primary respondents,2028%3B based on primary research.) is set to grow at a base CAGR of 4.4% for the period 2020-2025, until the sector is worth $147T (2025). Assuming that this CAGR (4.4%) holds for the period 2025-2030 we can project the value of the sector to be worth approximately $182.31 T by 2030.
According to [Preqin Insights](https://www.preqin.com/insights/research/blogs/venture-capital-becomes-second-private-capital-class-to-hit-2tn-aum#:\~:text=The proportion of private equity,against 23.7%25 for private equity.), as of 2022, the Private Equity and Venture Capital markets have $6.3T and $2.03T in AUM, with a CAGR for the period from 2022-2028 of 11.5% and 20.2% respectively. We will make the assumption that this percentage will hold for the period 2028-2030.
According to [Vantage Market Research](https://www.globenewswire.com/news-release/2022/07/01/2472808/0/en/23-3-Billion-Global-Web-3-0-Blockchain-Market-Growth-with-GAGR-of-41-6-2022-2028-The-Benefits-such-as-Improved-Privacy-Secure-Network-Driving-the-Market-Web-3-0-Market-Growth-Size-.html#:\~:text=According to our primary respondents,2028%3B based on primary research.), the CAGR for the Web3 Industry is set to be 41.6% for the period 2022-2028.
⚠️ We will make the assumption that the assets under management for Web3 VC will grow at this CAGR until 2030.
⚠️ We will make the assumption that Investment DAOs will take 20% of all AUM for Web3 VC investments by the year 2030.
Asset Management
AUM (2022): $100,000,000,000,000
Growth Rate: 4.4%
AUM (2030): $182,300,000,000,000
Private Equity
AUM (2022): $6,300,000,000,000
Growth Rate: 11.5%
AUM (2030): $15,050,000,000,000
Venture Capital
AUM (2022): $2,030,000,000,000
Growth Rate: 20.2%
AUM (2030): $8,850,000,000,000
Web3 Venture Capital
AUM (2022): $25,200,000,000
Growth Rate: 41.6%
AUM (2030): $810,160,000,000
Penetration Rate: 20%
Potential Market Size: $162,032,000,000
Under the assumptions presented above, the TAM for the Investment DAO sector can be sized at $162.032 Bn by 2030
What are other key players in the Investment DAO space? The Web3 Funding ecosystem is very diverse, and offers various types of funding for protocols of all stages and geographies. Below is an ecosystem map of the web3 VC space:
A more in depth analysis of the Investment DAO landscape is required to better understand the value provided by GCR DAO:
Type: Investment
Members: 410
AUM: -
Pros:
9 week incubation program. Worked with 84 startups, 170+ founders
Mentor community of 120+
Small number of members maximizes contribution potential
Provides Deal Flow by intros to DeFi Alliance founders and invitations to Demo Days
Service Opportunities and Network creation opportunities come with membership
Cons:
Have to apply through google form, no clear indication of entry fee requirements
Entry Fee: Unclear
Type: Investment, DeFi
Members: 1400
AUM: $7,289,450
Pros:
Stacker Ventures creates decentralized funds under the venture capital framework.
Funds are managed by institutional investors at Stacker VC
Their Venture Fund 2 (currently open) has only 365 members, so there is great potential for contribution. Raised 5M so far
There is a hard cap at 1200 WETH
Cons:
Lack of clarity on joining requirements/expectations
Entry Fee: Unclear
Type: Investment, Incubation
Members: 8812
AUM: $15,000,000
Pros:
Backed over 30 projects inclusing KrauseHouse, Cabin, Forefront and Poolsuite
Focuses on incubation activities with its purposedfully designed accelerator
Have a Studio for launching Tokenized communities in web3
Has 8399 Discord members
Cons:
Launched membership to DAO through $CLUB token, it seems token sales for CLUB have ended.
Entry Fee: No Longer Accepting New Members
Type: Investment, DeFi, Education
Members: 18900
AUM: $1,335,655,605
Pros:
Massive treasury, one of the leading investment DAOs in the space
Over 650M allocated to projects
Supported by Peter Thiel , Jump Capital, Pantera Capital and Alameda Research
Ease to join, $BIT is actively traded
Cons:
With its big number of members, expected contribution to BitDAO is lower than other DAOs.
Entry Fee: $0.5/Token, have to own minimum 1 token to enter.
Type: Investment, Legal, NFTs
Members: 141
AUM: $26,966,481.57
Pros:
Ethereum ecosystem based
Accepts only US accredited investors
Requires KYC!
Cons:
Very selective entry requirements
Entry Fee: 375 ETH → $550,247
Type: Investment
Members: 56
AUM: $3,088,011.29
Pros:
Investment DAO dedicated to players. Players are in charge
Raised 10,000 ETH so far
Web3 Gaming focused
Asking for KYC validation before joining
Initially up to 29 members
Cons: DAO is still in development
Entry Fee: Each member can purchase 5,000 Ready Player DAO units for 35.712 ETH (up to 200,000 units for 1,428.48 ETH).
Type: Investment
Members: 56
AUM: $1,429,610
Pros:
Intended to have 99 initial members.
Each member can purchase up to 30ETH
Select community based on entry ticket
They ask for KYC validation
Cons: Entry fee is too high for me
Entry Fee: 10 ETH → $14,673
Type: Investment
Members: 159
AUM: $6,900,000
Pros:
Community of senior VCs, founders of popular protocols.
Investments decided on by “mages”
Cons: It is not possible to join them at this time. They seem to be closed off to newcomers. They are looking to invest, not onboard new people.
Entry Fee: Not accepting new members
Type: Incubation
Members: 529
AUM: $64,400,000
Pros:
Incubator for DeFi projects. This Investment DAO is sector-specific.
Small number of members means higher monetary contribution per member while also maximizing chances of useful contribution
Interesting partnerships with Gnosis, Arbitrum and DAO Stack
Community is free to join
Cons:
Unclear joining requirements/interactivity expectations
Voting infrastructure handled thru private dApp. currently in development.
Entry Fee: Unclear
The key differentiating factor for GCR is its novel community-driven media mining strategy, which is set to define GCR as a thought leader in the space further expanding their inbound sourcing efforts.
This eventually means that the GCR brand will attract founders due to their quality of content and brand image (The same way top VCs use content creation as a sourcing tool, GCR just created a new, more efficient way to perform inbound sourcing).
Due to this innovation, i am convinced that GCR will be one of the winners in the Investment DAO space. This is also the reason why I joined GCR.
Governance on the GCR DAO is handled through voting system Snapvote. Therefore to get a better idea of what the DAO’s voter activity looks like we must look there:
Total Snapvote Members: 59
Total Proposals to Date: 6
Average Vote Count per Proposal: (26+6+23+29+19+44)/6 = 24.5
Average Voter Turnout Rate: 24.5/59 = 41.52%
Who are these people? - Governance members for GCR DAO are Gold Tier and above members.
Even though membership numbers for governance on this DAO are low, the average voter turnout rate is much higher than other governance DAOs (For example, 3.2% for The Graph). What this tells us is that the governance members of this DAO have a higher vested interest in its success, and thus are more active in the governance of said DAOs.
Total Supply: 10,000,000
Number of Holders: 643
According to the GCR Tokenomics site:
Community Treasury: 70% that is allocated across initial airdrop distribution, media mining program, and community treasury. Vested in a linear 4 year schedule (below)
Past GCR readers from the last 4 years: 3%
GCR Discord group airdrop: 3%
Media Mining: 15%
Community Incentives (partner airdrops, social media campaigns, community writing bounties): 49%
Team: Vested in a linear 4 year schedule (below)
Current Team and Advisors: 20%
Future Team: 10%
Seed Club ($SEED) received 2% allocation of the community treasury due to GCR being a part of the second social token cohort.
40% of the total token supply is available starting today, with the remaining tokens 60% unlocked after one year, and vested for a period of 3 years in line with the schedule below.
Year 0: 40% of the tokens vested or 4 million tokens
Year 1: 30% of the treasury tokens vested or 3 million tokens
Year 2: 20% of the treasury tokens vested or 2 million tokens
Year 3: 10% of the treasury tokens vested or 1 million tokens
Given the $GCR token launch was announced March 2021, at this point in time (Aug 2022), we are into Y1 of the token vesting schedule, where there remain 3 million $GCR tokens to be unlocked from the vesting protocol. According to the GCR tokenomics website ${^8}$, the community allocation of 70% is held in a multi-sig wallet to be distributed as the community pleases.
It is important to note a couple things:
The biggest tokenholder in the chart above is registered as Global Coin Research: Treasury
The second biggest tokenholder in the chart is the Polygon (Matic) ERC 20 Bridge
These two wallets collectivelly own 62.77% of total token supply. Since these accounts don’t represent a single stakeholder, it is reasonable to conclude that token ownership across the GCR DAO is better distributed than other governance DAOs. But to further drive this point forward, we will calculate the Gini Coefficient for this DAO.
Gini Coefficient: This coeffiicent is calculated from on-chain data and hasa value between 0-1. Where 0 represents perfect equality and 1 represents perfect inequality.
import pandas as pd #We import required libraries
import numpy as np
df = pd.read_csv('GCR_HolderData.csv') #Import Etherscan data
df = df.drop(columns=['PendingBalanceUpdate']) #Drop unneccesary columns
def gini(x):
#Define function to calculate Gini coefficient
total = 0
for i, xi in enumerate(x[:-1], 1):
total += np.sum(np.abs(xi - x[i:]))
return total / (len(x)**2 * np.mean(x))
balances = df['Balance'].array #We convert the balances to an array data type
gini(balances) #We compute the Gini Coefficient for all wallets
After running the code above, the Gini Coefficient for all wallets holding $GCR is 0.9694601575002882, which is close to one. We proceed by looking at the top 10 GRT holders:
df.sort_values(by='Balance', ascending=False).head(10) #Represents the Top 10 Wallets
Please note that the computation of the Gini Coefficient above includes the top 2 walllets which are the DAO's treasury and Polygon Bridge. These are not representative datapoints for our analysis, as we want to gauge for tokenholder inequality amongst external parties. We will proceed to filter these two wallets out
df = df.sort_values(by='Balance', ascending=False)
df = df.drop(index = [495,165]) #Hard coded the indexes for the top wallets
balances_n = df['Balance'].array #We re-calculate the Gini Coefficient
gini(balances_n)
The revised Gini Coefficient is 0.9274933785635494, which shows a variation of 0.04201 after removing the treasury and bridge.
Token distribution amongst GCR tokenholders is inequal, making this token’s price vulnerable to big selloffs as the Gini Coefficient is 92.7%, with 100% representing one wallet owning all tokens. That being said, when compared to other governance DAOs, GCR’s Gini Index scores much lower. For reference, the computed Gini Coefficient for The Graph governance token was 99.4%, which is an increase of 6.7 percentage points.
The GCR Website expresses the following about the token’s utility:
Governance– The main purpose of $GCR is to be used to govern the entire ecosystem including the publishing platform, treasury, and operations.
Liquidity- Users can add liquidity to the $GCR <>USDC Uniswap pool and stake those to earn yield.
Token-Gated Access– holders of $GCR can access our exclusive $GCR community events in Discord (as shown in the membership tiers above)
HODL– Starting soon, GCR holders will have an opportunity to earn from the community rewards pool.
Value Proposition
$GCR by winning media farming bounties
Get unique access to dealflow
For Gold Tier and above: access to investing through GCR