1. The community lacked a clear understanding of its purpose resulting in individual contributors failing to understand their role in and relationship to the system.

2. There was confusion about who holds power and how decisions are made leading to members feeling misrepresented and disempowered.

To address these challenges, we recommended that Radworks define a purpose around which the community can organize itself and improve the legitimacy of their governance.

In general, a defined purpose helps:

• Constitute a group and/or organization, providing parameters around membership. 

• Codify what the group believes in and what impact it seeks to have.

• Memorialize why the group exists, so that it can be returned to for clarity in times of change, challenge, confusion, or conflict.

• Serve as a North Star for governance: legitimizing what decisions are made, how they are made, and enabling the community to hold itself accountable to previous decisions.

To define and iterate on Radworks’ purpose, we led a 6-week design process with the founders, core team, and community. Defining purpose is commonly challenging for teams, who struggle to step back from day-to-day operations to explore and find consensus around a grander, more visionary purpose. These processes often surface core unspoken tensions within a community, necessitating outside facilitation. 

The initial purpose statement was defined by a 6-person taskforce before we brought it to the community for feedback and iteration. The outcome of this process is the following purpose statement as well as accompanying values and focus areas. 

The DAO funds new, resilient, permissionless technologies to cultivate internet freedom. We focus on funding and supporting the creation of censorship-resistant and decentralized technologies that empower builders and creators to collaborate. We are committed to enabling individuals and communities to collaborate in the digital realm securely and freely. 

Once published, the community will ratify the purpose in on-going ceremony on the Radicle platform.

This purpose serves to constitute Radworks, memorializing what the community believes in and why it exists. It's intended as a living document: a North Star to which  the community can return for clarity in times of change, challenge, confusion, or conflict. If successful, this document will help protect and further Radworks’ purpose over time as the community  collectively navigates change. 

With this purpose defined, we are now working with the Radworks team to develop metrics, reputation, and a system of accountability to ensure the organization stays committed to its mission over time. Stay tuned!

Planning this transition prompted an important question: would a one-token-one-vote governance system advance or erode Radicle’s core mission? Without protections (e.g., voting mechanisms, more distributed voting participation, checks-and-balances, etc.) would the financial interests of token holders ultimately lead to decisions that threaten its founding mission? 

To pre-empt this risk, Radicle asked Apiary to support in designing a governance system that would ensure the successful stewardship of its mission over time. 

Designing governance beyond the norm

As many DAOs have found, moving beyond the norm of a one-token-one-vote system is complex. In all decisions, and especially those that change the underlying dynamics of power, there are technical, legal, and social complexities to be considered. To avoid this complexity, we often jump to solutions without all the relevant information about the community in hand.

To build an effective governance system, we must first ask:

• What is the purpose around which people are in collaboration?

• Who is in the community? What are their underlying motivations and incentives? How do stakeholders identify with and understand their participation? 

• What is the environment the community is operating within? What are the constraints, incentive structures, and behaviors needed for the network to succeed?

• Do people understand the current governance system and how it functions?

Answering these questions is essential to building an effective governance system, and to designing its most foundational element: who has power to influence or direct change? 

Community research 

To answer these questions for Radicle, we completed a comprehensive qualitative analysis of the community. Over three months, we analyzed all existing documentation and historical decision-making processes. We also conducted more than 20 formal and informal interviews with community members representing the ecosystem’s core stakeholder groups.  

The output of our analysis is an Insights & Recommendations Report which presents the information gathered along with a series of recommendations for the DAO’s governance, culture, and future. 

Recommendations & next steps

The research revealed several insights into the community: its stakeholder demographics, culture, self-perception, challenges, and opportunities for improved success.

Two insights in particular catalyzed immediate action from the Radicle team:

1. The community deeply identifies and aligns with the vision of a free and open internet, but lacks a clear understanding of the community’s purpose.  As a result, individual contributors fail to understand their contributions, impact, and role in the system, hindering the full potential of the community’s collaboration.

2. There is confusion about who holds power and how decisions are made. The team is working to provide more transparency and structures to legitimize the ecosystem’s governance and the decisions it makes.

To address these issues, we have been working with the founders, core team, and community to define and communicate Radicle’s purpose. Once defined, this purpose will serve as the foundation for iterating on and advancing the ecosystem’s governance system.

Why do we need a better mental model? 

(1) Without a common definition of governance, we run the risk of miscommunication and misunderstanding. This hinders our opportunity to research, learn, and deepen collective knowledge. 

(2) We commonly define governance by the visible aspects of a system (i.e., rules, voting, and decision-making mechanisms). Doing so fails to account for the myriad other factors (e.g., socio-cultural, operational, and economic) that influence decision-making. A narrow definition of governance limits the diversity of information and quality of analysis which informs the design of our systems. Using a narrow definition of governance is a bad practice with potentially catastrophic consequences for our communities. 

So, how should we think about governance? 

Simply put, governance refers to the structures and processes that together determine how decisions are made in a given context. In short, it includes:

• Rules & processes on what decisions can be made;

• Rules & processes on how a system and its rules can be changed;

• Bodies, institutions, and procedures to monitor compliance to the rules, hold actors accountable, and resolve conflict.

A better model for governance combines what we traditionally think of as governance with:

• Socio-cultural components (e.g., purpose, cultural norms, communication);

• Accountability and conflict resolution; 

• Information structures (e.g., communication channels, reporting, and documentation); 

• Operations (e.g., economic, treasury, and people management); 

• Power and value distribution (e.g., ownership and incentive mechanisms).

Simple, right? But in complex adaptive systems, which we believe decentralized organizations and communities mimic, governance is much more dynamic. What’s immediately visible in governance and most frequently referred to as “governance” – i.e., rules and decision-making mechanisms – are in fact underpinned by a web of interdependent attributes, all of which influence decision making.

Governance is the place where the organic complexity of human behavior and social systems meet structures that help inform, shape, and drive the intended outcomes of a collective.

Through this improved, nuanced mental model, governance is defined as the place where membership rights (1), decision-making processes, incentives, accountability, community composition and culture, and legal and ethical responsibilities converge. The outcome of this convergence can enable or undermine a group’s ability to effectively navigate and coordinate change. In other words, governance is the place where the organic complexity of human behavior and social systems meet structures (rules & processes) that help inform, shape, and drive the intended outcomes of a collective. 

What does this mental model allow us to do? 

We can approach designing governance in a more holistic way through this mental model. Rather than strictly looking at rules, voting, and their enforcement, we can begin to consider how the broader context (cultural, behavioral, economic, and collective) influences collective decision making – and ultimately how we could improve it.

This is the first in a series of articles intended to explore and define our take on governance. It’s a big and complex topic, so we’re breaking up our thoughts into this series of quick and digestible articles. In this first piece on Building a Better Mental Model for Governance, we’re intentionally not yet delving into context, culture or why governance is so hard.

1. Community science.

2. Operationalizing decentralization.

3. Effective governance.

4. 
   

Community science

Without a clear practice of community research, leaders build solutions based on absent or  biased information, which leads to controlling problems rather than solving them. The inability for these solutions to meaningfully address community challenges breeds frustration – both for community members who feel unheard and for leaders who feel like their efforts are in vain. 

Our approach = Through qualitative research, we enable communities to see, understand, and assess themselves, which results in improved community interactions and outcomes.

Operationalizing decentralization 

Decentralizing an organization is hard. It compounds the difficulty of founding a startup by distributing decision making before culture, values, processes and sometimes product market fit have been established, integrated or internalized. This approach removes the essential ingredient of time in how systems of human collaboration mature. The result is unnecessary complexity and disorganization. 

Our approach = By visualizing how the whole breaks into its parts and how each element relates to the whole, we create a map within which members are able to orient themselves. Where and when useful, we apply traditional structuring. 

Effective governance 

Governance (defined as the systems and processes by which groups of people navigate and direct change through decision making) is inherently hard. This is a known and a perennial challenge, evidenced in organizations, communities, and democracies all over the world. It’s hard for a myriad of reasons: We struggle to understand what governance is, we’re overwhelmed by the complexity of collective-decision making structures and processes, and our imaginations are limited by the precedent of legacy systems.

Our approach = To admit what we don’t know; if we did know the solution, our democracies would function. What we do know is that bespoke systems built for a specific community’s context have higher success rates. We are beginning by building these systems for our clients. We then plan to measure the efficacy of governance over time to define what does (or does not) work. 

More is possible

Through a focus on community science, operationalizing decentralization, and effective governance with our clients, we have found that communities become rich in ideas, kind in relationships, and they get more done. More is possible. 

Today, there is not enough energy focused on building systems in harmony with the needs of both the individual and the collective. When combined, we believe Kristen’s background in operational excellence and experience as a DAO contributor and Camille’s leadership in systems design and governance innovation represent the expertise required to address this challenge. 

We aim to build the structures that solve for collective decision making and individual well-being. When in harmony, communities can better participate and accelerate the collectives’ vision, and more becomes possible.

The first phase of our work will focus on research outlining the current state of collective decision making in Web3 communities. If you would like to receive this research, sign up.

Today, we’re proud to announce the launch of apiary, an applied research company developing governance solutions for decentralized organizations.

We believe that good governance is key to the future of decentralized organizations and web3. It’s the secret ingredient needed to make the whole greater than the sum of its parts.

But today, governance is hard. We’re struggling to decentralize in ways that garner community participation, enable effective decision making, and mitigate risk. Our goal is to make that easier. We’re building data-informed solutions to governance design, so that teams and communities can better grow, ship solutions, and build new worlds together.

apiary is founded by CEO Camille Canon, in partnership with Kickstarter and with the support of 2050. Canon previously co-founded Purpose, a social enterprise on the forefront of new institutional models of ownership and governance.

What do we mean by governance and why should we care?

At the most basic level, successful governance is systems and processes which enable interested individuals, parties, and groups to make effective decisions toward common objectives. These systems are often overlapping, taking into account official, political, or legal requirements as well as those driven by social, cultural, or personal incentives.

These systems are also more than the day-to-day, nuts and bolts of how things work (or don’t); at its core, good governance supports groups of people in understanding, navigating, and ultimately directing change in a rapidly evolving and increasingly complex world. Governance is what underpins the ability for collaboration at scale.

Governance is what underpins the ability for collaboration at scale.

When these systems are working well we can feel it, even if “governance” is not the first thing we think about. Let’s imagine, for instance, a well-run town or municipality. Its elected officials competently conduct the formal business of running the local government, engaging with citizens on a regular basis and through open communication channels, allowing them to address any issues and debate swiftly and effectively. Local citizen-run groups support various initiatives in the area, cultivating and reinforcing voluntary participation and collaboration among the town’s citizens. All components, formal and informal, working together to achieve consensus on the town’s maintenance and future. And when conflict arises, which it always will, there’s space and processes for constructive disagreement. Stakeholders with conflicting interests are able to work through them together.

This is a nice image, but we usually get the opposite: systems riddled with misaligned incentives that discourage collaboration and disincentivize good decision making. A corporate voting structure that does not encourage robust debate among interested stakeholders. A company culture that blocks new ideas and strategies, where information flow is siloed and ineffective. Local communities where important issues get hijacked by loud, partisan forces, taking energy and focus away from solving core problems. An imbalanced and ineffective federal government that does not represent the majority perspective on core issues.

The inability to build and maintain systems that cultivate interdependence and enable people to build things effectively – solutions, products, businesses – together is a failure of governance. We often focus on the individual factors, or malign actors that subvert these systems, but it is just as often a failure of the design of the system itself that leads to these common frustrations.

web3 depends on governance

web3 has been heralded as the next era of the internet, a new paradigm that will disrupt the dominance of corporate centralization through new organizational models that allow those who contribute to value creation to participate in decision-making and economic upside. This vision promises to disrupt how we control data, content, and platforms, and to change how we build organizations, create communities, and drive value. At its core and at its best, this evolution of the internet represents a shift from hierarchical corporate governance models to a system based on a more egalitarian concept of interdependence and human cooperation.

We are optimistic about this vision. The last few decades of open source and public good projects (Wikipedia, Linux, etc.) have demonstrated the power of the internet to facilitate global collaboration and disrupt existing power and information structures. That said, we understand that this vision will need to be built. To date (and with Wikipedia and open source examples notwithstanding), the internet has supercharged previously existing power and value systems, resulting in a web controlled by a few mega powerful corporations.

The promise of web3 to overhaul this system isn’t a given. History has demonstrated that in the face of new technologies, the logic and momentum of existing systems persist. If we want to drive radically different outcomes in the next phase of the internet, we must innovate on how we design systems and the rules that govern them over time.

Why is web3 governance so hard?

Challenges in decentralized communities mirror those we face in “real world” organizations, communities, and democracies. They, too, struggle to balance the interests of stakeholders, facilitate access to information, build consensus, manage conflicts, and maintain social cohesion around common objectives.

The logic of traditional corporate governance, defined by business strategies that funnel activity toward maximizing the value of a shareholder's stake in the company, cannot be simply transposed onto web3 projects. In contrast to these legacy systems, web3 projects depend on a diverse and prismatic set of stakeholders, whose interests by definition interconnect but may not always align.

Success in web3 governance supports the equilibrium of actors, not a hierarchy of them. Effective governance should support alignment among stakeholders, encourage sustained participation, and provide effective pathways toward conflict resolution. These systems and processes are most effective when they reflect the specific context, culture, and objectives of a given project and community.

Success in web3 governance supports the equilibrium of actors, not a hierarchy of them. Effective governance should support alignment among stakeholders, encourage sustained participation, and provide effective pathways toward conflict resolution.

While there is broad acknowledgment that improving governance systems in web3 is important, it is also clear that more research, experimentation, and prototyping is needed. It is challenging and at times all-consuming to design a protocol, find market fit, test and deploy a system, manage a community, all while debating and implementing the proper parameters of decentralization.

For projects to reach their full potential, we believe teams and communities should make governance an integral part of a system’s design. Because decisions made early on in a project’s development often have meaningful downstream effects related to power sharing, decision making, business development, and community engagement. By prioritizing governance design, developers and their community can increase their project’s chances of success, not simply mitigate its chances of failure.

apiary - advancing good governance

At apiary, we think that governance goes beyond the basic rules of the road; well-designed, custom systems will separate those protocols and projects that are just getting by from those that achieve beyond their original, hoped-for parameters of success.

We support teams in designing governance systems to advance their objectives as well as processes for implementing organizational change towards decentralization. We understand the challenges organizations face, having worked with dozens of traditional companies, communities, and governments to build governance models that support the stewardship of enterprises, data, housing, and other assets. We’re excited to apply these learnings to web3, and believe that a phase of experimentation and prototyping will help us develop best practices and scalable solutions that make the tricky work of governance easier for teams going forward.

At launch, we’re excited to be working with the team behind the protocol Kickstarter is supporting to design a governance system that furthers the company’s mission of helping to bring creative projects to life. Building on Kickstarter’s legacy as a Public Benefit Corporation, we’re working on designing a system that supports the protocol’s health and sustainability while ensuring its mission stays core to decision making.

In the end, our mission is to advance good governance. To us, blockchain networks represent the most granular data on collective decision making in history. We see an unprecedented opportunity to research and build data-informed approaches to governance — the learnings of which we believe could extend far beyond the web3.