RFC Compensation Plan with Bonus Structure

hOHMwardbound - thank you for the info.

Q: Will 'Council' members that are in both team/department and council roles, earn bonuses from 'Council' and 'Teams'?

Note for the record: I firmly disagree of the substantially lowered OKR's that make it easier to meet lower targets with high payouts. Previous OKR's were set in the base agreement to setup a Council, the Council was voted-in, in this agreement.

hOHMwardbound - There is no argument and how could it be one by querying a comp proposal with details stated by the team!

My suggestion would be to keep to the original Council creating vote, noted OKR's of the below and have visible public tracking made public, so the DAO can achieve it's targets that's beneficial to all.

-- [DAO-WIDE 1] was $632 million, now changed to $400 million.

-- [DAO-WIDE 2] was increase premium to 50% higher than backing, now changed to 20% higher.

bubbidubb Thanks for the thoughtful comments.

6 month job security (If I understand this “allocation concept” correct)

Not everyone will be designated Consistent Contributor, and not every Consistent Contributor will get 6 month agreements, maybe 2 or 3 or 4 months. But imo it's really important to give full timers in the DAO better understanding of how much bread they can put on the table in the coming months.

Crypto-winter 2018/2019 lasted up to 2 years depending on how you measure. And that was without macro headwinds. This time, we are in new bear and macro looks like total shit. $28M is a shitload of money. Come on, man. 2.1 years?? Must do better.

If we achieve all the Bonus Goals then by definition the Treasury will be able to bond once again and increase the DAO treasury, so I don't think we'll ever hit the 2.1 years runway and be much closer to the 4 years. Especially for the Premium goal, increased premium means increased runway by definition since the DAO would pay out the same USD amount using OHM which has increased in value.

That said, what would be a proper runway length in your opinion?

Reaching 400M end of year is just a mere return to where we were on May 1^st. Come on, man. Who sets a market value based bonus goal just after a crash – taking as reference a crash value?

I think it's good to increase this amount as we're already pretty close to it. Maybe 500 or 600.

We lack credible data on backing to assess this. Also 30d MA of price, or 30d MA on backing – be specific.

Good point, it should be 30d MA of both.

This is the only non-measurable objective. As such, I don’t like it.

I have to disagree with you on this one. It's perfectly fine to have a binary 0-1 goal, either the protocol achieves decentralized operations via the OCG + Risk Management Committee or it doesn't. Also I'm sure that tighter regulation will come as a direct result of the LUNA/UST and related fallout. We cannot be caught with our pants down when it happens. So it's not an internal pat-your-back thing, the consequences are dire in fact from a regulation standpoint. Even economically, many institutions and exchanges won't touch an asset that's centrally controlled, even via multisig.

AND/OR conditionality:

Disagree fully with the notion that Olympus can just wait for the next bull market and profit big, even with poor team performance. The external market might help, but plenty of crap projects died even in the bull market. Also, the bonus weights are super important imo because they do allow for some flexibility while fairly punishing the DAO for not meeting certain objectives. I don't think it should be all-or nothing as that leads to significant motivation problems if it looks like we won't achieve them all simultaneously.

Bonus amounts

To be clear, all comp and bonuses are physically paid out in gOHM, like they are now.

The payouts from the DAO are extremely difficult to track on-chain.

You can check the DAO multisig for all the transactions, they're not really obfuscated. Plus the data studio link has deeper insights:
https://datastudio.google.com/reporting/cb74b814-7ce1-4449-88e5-eac57637b934/page/ZK0YC

Thanks again for your comments.

As a full-time contributor who's left an engineering role at a traditional tech company to focus 100% on Olympus, I feel that this proposed structure is reasonable and fair. It incentivizes full-time contributors to remain focused on Olympus without having to feel the need to straddle the line or be thinking 'whats next' on a month to month basis.

Re: some of the comments, IMO we should not be comparing ourselves to what is 'normal' in tradfi. Although its good to benchmark other organizations, i do not think we are trying to promote the culture of tradfi organizations. I'm in the camp that organizations, including Olympus, should do whatever they can to promote a level of confidence for top performers without contributors living like they're potentially going to get rugged on a month to month basis. Contributors should be focusing all of their mental energy on how they will deliver results and accomplish the OKR's of the DAO, not on what their plan is if they don't have a role next month. It promotes maximum ROI for Olympus.

If there is a concern of a 6 month cliff where we potentially churn contributors, I think another layer/dynamic of this to consider is vesting tokens on a rolling basis.

Thank you @hOHMwardbound for the well thought out proposal and for continuing to push for us to retain and attract top talent. It's critical for us to accomplish our mission.

bubbidubb salary + max bonus = $540,000 is arguably below market rate for similar level positions outside of crypto, I see absolutely no problem with that.

@gordob @bubbidubb

Will reply to what maybe hasn't been addressed in 1 post to keep it organized.

1. The runway example is an extreme one, because if you achieve all the OKRs it's hard for the DAO funds themselves not to grow, thus increasing runway.

2. Council won't be double-dipping. We however have not been given authority for the new budget proposal yet, so are continuing to receive the pay we had as Strategos and indigo as an engineer until then. Once voted on, the Council will be on the approved plan.

3. The OKRs you keep mentioning were posted as a RFC and were not voted on. Furthermore, they were 1 year targets vs these targets that are 6m. We can obviously discuss them, but setting OKRs that are too high and tying them to comp can be very demotivating for contributors, so lets be realistic.

4. Finally, we are nearly finished with a new Subgraph implementation that will showcase all this data in a clear and transparent manner, as we've always aspired to do. Really don't appreciate the comment about the DAO trying to obfuscate something, when OlympusDAO is one of the most transparent protocols when it comes to contributor comp and treasury allocations.

Finally, thanks for the comments. Figuring comp out has been a huge struggle for the DAO and I hope we can work something out so that everyone is happy.

Bonus amounts
The communications around 3,3 and high APY's set a tone, and expectations. But our backdrop is now a 95% drawdown from the peak. This is pain for 3,3. Ultimately, the buck stops with someone. And in this case SO could only be considered to be the DAO even if it feels unfair. The Gainz chart is further giving an update on where the 3,3 community stands in terms of pain:

With this as context, awarding the top with a possible half a million USD feels rich. Half a million buys 3 family villas from where I come from, and probably like 2 Ferraris from where you come from. And that's a bonus achievable in a time period of 6 months from now with this backdrop?

I find the base level salaries to be high, but to get good people that is very competitive and attractive for the best. The bonus level however is out of touch with the real world, the community, and with the quality and the value of what has been delivered to the market. If you are losing top resources because the compensation is too low, just announce it and we will see if we cannot scramble appropriate replacements. Just ensure that proper hand-over documentation is continuously being maintained by every key resource so that we have something to put in the hands of new contributors. Also remember, these amounts will eventually hit the market as sell orders and not only drain DAO funds but drop market cap too.

Bonus goals
The reason for conditionality is that bonus should not be a given. If so, it should be part of base salary and not referred to as bonus. Bonus is not a right. Getting to top 90 plus increasing Treasury at same time is a challenge as it requires Olympus to be better than other projects, rather than just riding the market. Don't know how to explain myself clearer.

Runway
The compensation model needs to rest on a plan for transitioning to being sustained from revenue and not assets. Runway should be indefinite. If we cant get to sustainability, then why are we burning assets at all?

Compensation payouts @shadow
Why my tone.. I know there are very detailed google drive docs, but I think we should be able to follow DAO payouts on-chain. On-chain I would expect to see monthly recurring patterns of payouts corresponding to the compensation framework in number of transactions/contributors and value. I would expect to be able to track the exchange rate of currency conversions to verify that it is aligned with the decided framework and monitor said runway. But when I look at DAO address I get:

Tokens I dont even know of. This is not easily understandable to me, or am I dumb. And the swaps that take place downstream do not help at a glance. Of course I wonder what are Acropolis DAO tokens? How are ODY used and swapped? These are bulk transactions possibly one per compensation and contributor? Or maybe you bulk it in initial trx's and then explode at later stage.. Pls dont answer here, just make it so we dont need to use specialized software to audit or spend hours to puzzle it together.

Suggestions
1. Bonus goals should all require stellar performance by the project - not just fall out depending on what market does
2. Include Gainz chart as bonus condition: a majority of the 3,3 community should be over water for any bonus to be paid out - but the past needs to be left as past at some point - so take January 1, 2022 as the snapshot. Rolling snapshots would be the best ofc.
3. Work on transparency - Information scattered on google drives, unreliable dashboard, outdated dune charts, monthly reports written like sales pitches. So much effort, yet not much credibility. What can I trust? Where should I look? I want to trust.

BTW: We work 24/7 because we love what we do, and the people we do it with. Not because of over-the-top monetary bonuses.

I think I have written enough now. Probably just reiterating my points over and over.

Appreciate the detail laid out in this RFC and think it's a step in the right direction on several levels - most notably to give consistent contributors a level of assurance they won't get rugged from month-to-month and thus can continue focusing on Olympus without immediate concern for their livelihood.

My main feedback is on the council comp proposal. Note: I'm excluding engineering council members (aka Indigo) in my comments below as engineers are on a different scale and agree they should get paid more.

Base: Council Members paid a level 8. TBH the pay levels are so subjective I don't have an opinion here. Likely somewhere between a 7-9 makes sense. So why not an 8.

Bonus: Assuming a pay level 8, Council Members have 6.26x greater bonus oppty than a non-council member. Compared to a non-council member earning a pay level 10, Council Members have 5x higher bonus opportunity as proposed.

This doesn't seem right.

If the argument is Council Members are burdened with extra responsibility and thus should receive outsized upside, I think the counterargument is the activity of the DAO has decreased dramatically over the last few months. So while I acknowledge there are new responsibilities asked of Council Members (here: https://forum.olympusdao.finance/d/1156-oip-91-olympus-governance-council), I think the net level of responsibility/activity for Council members is likely neutral. In other words, I view the Council member responsibilities as justifying the 7-9 pay level mentioned above and don't view these responsibilities as justifying a bonus difference vs. everyone else as proposed.

In summary, I think a 5-6x bonus difference between Council and non-Council members is not the right approach. I would support up to a 2x but can't justify going above that.

Let me emphasize, this isn't personal at all. I enjoy all the members of the council and know a lot of thought went into getting this RFC out the door. The purpose of an RFC is to do just that, get comments so we can hopefully make proposals better.

+1. Support and very well written.

I would recommend that this be revisited every quarter by the governance council and compared to DAO runway.

even tho all KPI's are met and funds would grow, burning through 30 mil in 2 years is real ouchh.. Maybe lower base pay in bear, and make bonus higher once funds start pour? You cant burn now when its low income, you burn it when you have cash flow.

geez, great stuff n discussion all points considered… standing by

I think this is a strong first step and important to the longevity of the project. As a DAO is decentralized, having a decentralized work force creates it's own set of unique problems so I see incentivizing people to make a career working on the project as a good thing. If we don't, we end up with disjointed ideas and organic code that has to be patched together because a person left and a new person came. Decentralized doesn't mean disorganized but in order to create strong pillars and a healthy platform, we have to have people stick around and build for a reasonably long term.

Tying bonuses to OKR's and allowing for work contracts make sense to me. I do agree with lipman on a bit of scrutiny to the bonus scaling of Council. A 5x Bonus seems steep. I'll support a higher pay scale but if we're introducing bonus then I think an equitable scale that more evenly covers the team would incentivize driving towards those OKR's rather than hard work for 1/5th the return.

Otherwise, really excellent work and creating a more long term and equitable comp structure.

FD_ I respectfully disagree. Giving dedicated contributors fair and clear compensation in a bear is the way to make it through, it will allow us to keep shipping products.

Keep in mind that there are a number of contributors (myself included) that do not sell their comp. So I think it's important to take that into consideration when evaluating the perceived drain on Olympus when it comes to compensation payments.

This framework helps all contributors set their sights on a common goal and that will ultimately be a net benefit to all holders.

2 things come to mind;

you get what you pay for

pay me know or pay me later

We have an amazing group of people that work here. I for one would like to keep them here. I would like to have the compensations for work to be competitive and fair. I have very little knowledge of what the core team must do to keep this DAO up and running. My want is to keep OHM growing and to kick ass for a long time. Some people think they can just treat our workers like shit because they can be anonymous, says a lot about the person talking shit. Our people are amazing, keep them pay them. I for one don't want to loose them!