Introducing AIP-009
We’ve designed a great product with Quiver and we aspire to design many more products and components. For everything we design, we aim to build and scale out into the world so that everyone can share and use what we’ve built. In order to do this, we’ll have to figure out hard “real world” problems around manufacturing - labor, supply chain management, warehousing, facilities, distribution, etc. Arrow has proven capable in predominantly online activities like collaborative engineering, discussions, recruiting, and community growth. I’m confident we’ll excel further in areas like marketing, sales, governance, and treasury management. However, our real-world capacity remains burdened by inefficient interfaces with the physical world.
IRL Interface Challenges
As a DAO, Arrow doesn’t have traditional legal interfaces with the physical world. We’ve “wrapped” the organization in a Wyoming unincorporated nonprofit association (UNA), but this hasn’t proven to be particularly useful for our practical hardware endeavors. With moderate difficulty we’ve been able to use the UNA as a vehicle to sign business contracts and open financial accounts, but it’s clear that the entity is not the ideal vehicle to scale out aircraft manufacturing. We experimented with a “DAO-owned” company with our now-closed Turkish workshop. Legally, it wasn’t actually owned by the DAO in any official sense. It was just a normal Turkish company owned by several Arrow members that agreed it would exist to serve the interests and directives of the DAO. Fine enough at a small scale where trust is high, but that’s obviously not scalable. The company also created a massive administrative burden with DAO reimbursements and accounting. It probably would’ve been easier to have the DAO just give a lump-sum grant to an outside company (likely still owned by DAO members) for the construction of our designed prototype. This exact approach has seemed to work for Quiver so far. Costs are much lower so it’s not a perfect comparison and there are surely other issues yet to be found.
Our experiments with the Turkish entity prove that we don’t function well with one foot in the traditional, centralized, world and the other living online in the digital realm. If our organization is constantly straddling that line, we’ll surely be overwhelmed with legal and administrative overhead before we make meaningful progress. There will always be a regular company without any of our decentralized governance that can make decisions quickly and out-execute us. So what can we do?
One Path: More Centralized
One option could be to spin off a DAO-funded company with the autonomy to operate like a traditional business. We’d provide substantial funding, appoint a CEO, and trust them to execute, while the DAO focuses on online strengths. We’d essentially be a publicly traded company with a passionate online community that contributes through open source designs. However, for the truest, most ambitious version of Arrow as we’ve defined in AIP-008, it falls short in several key ways:
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It’s not necessarily scalable and reaches diminishing returns. As the company grows, it reaches the limits of its centralized leader and will struggle to continue to improve and scale in the face of an ambitious mission depending on widespread expertise and collaboration.
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It’s closed, limiting the capture of public excitement. Community members that otherwise would want to contribute to Arrow in the real world will be walled off and won’t feel enough agency in the organization to really participate and spread their excitement.
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It fails to leverage thousands of potential community contributions and innovations. With stalled community growth, Arrow would miss out on all of the potential contribution and value added by a vibrant and passionate community.
At a certain size, an active community becomes completely unignorable and disrupts the status quo, gaining mindshare. Arrow needs to be that disruptor. Our mission of increasing physical connectedness depends on building a large, passionate community and harnessing its collective abilities through unparalleled remote collaboration.
AIP-009: Distributed Manufacturing Ecosystem
Instead of forming a company, I propose that we commit fully to being the best DAO that we can be, and choose to exist in a space where we’re not reliant on traditional legal structures or companies. How can we bring our designs into the world while remaining a truly online organization? How can we manufacture and distribute globally without depending on international courts? Instead of Arrow owning the company, the companies will exist within Arrow’s ecosystem. Anyone can join the ecosystem and manufacture our designs in a trust-minimized way. Our DAO will remain truly open and benefit from everyone who joins in. AIP-009 outlines a concept for Arrow’s manufacturing protocol. This is how we’ll coordinate to bring our vision to the world.
Please check out the draft of AIP-009. I’m very much looking forward to all of the feedback you all may have. AIP-009 is a general direction that we’ll approve for the DAO once we finalize the AIP. We should use it to reach agreement on the general architecture of the protocol and tokenomics, but we don’t need to necessarily decide on all of the specific values and parameters.
If and when the DAO approves this AIP, I will follow up with a project proposal to begin development, further specify requirements, and recruit contributors with the relevant expertise needed to develop the protocol.
AIP-009 can be viewed on GitHub here - dao-aips/AIPs/AIP-009.md at aip-009 · Arrow-air/dao-aips · GitHub
