Top Ten Rules for Building an Efficient DAO

1. Evolution from Simple to Complex

Effective complex systems often originate from simple and effective prototypes. When designing a minimum viable product, one should start with simplicity and gradually enhance functionality. This approach ensures that the foundation of the system is solid, laying a good groundwork for subsequent development.

2. Focus on key inputs

Approximately 80% of results come from 20% of core efforts. When formulating strategies, it is essential to identify and focus on the key areas that can have the greatest impact to achieve optimal resource allocation.

3. The Wisdom of Time Management

Work often expands to fill the available time or budget. To improve efficiency, it is important to set moderately urgent but achievable deadlines, as this can inspire the team's creativity and maintain project momentum.

4. Set indicators cautiously.

When a certain metric becomes a target, it may no longer be a good measure. This is particularly important when designing systems aimed at completing complex tasks, such as public goods fundraising or identity verification, to avoid creating negative incentives.

5. Trade-off in team size

Adding manpower to a delayed project may further delay progress. Maintaining a lean team size is usually more beneficial for improving efficiency and decision-making speed.

6. Exponential Technological Advancement

The development of technology is showing exponential growth, while costs are decreasing. In the construction of DAOs, one should fully leverage this trend and actively embrace new technologies to obtain potential huge returns.

The Power of Network Effects

The value of a network is proportional to the square of the number of users. DAOs should focus on building networks and ecosystems that can bring exponential value growth.

8. The Limits of Social Relationships

The number of stable social relationships that humans can maintain is limited. Unless necessary, keeping a smaller team size is more conducive to efficient collaboration. If expansion is needed, appropriate trust mechanisms should be designed.

9. Modular Design Philosophy

Following the principle of "doing one thing well in each program", design a modular system and processes. This approach helps improve the flexibility and maintainability of the system.

10. Consistency of Organizational Structure and System Design

The organizational design of a system often reflects its internal communication structure. When designing a DAO, attention should be paid to the coordination between the organizational structure and the system architecture to avoid an overly complex overall structure that is difficult to scale.