The Current Paradigm in which we mostly inhabit and have been socialized in creates incentives and narratives that are leading humanity to the destruction of the environment and causing immense suffering to human and non-human life.

We need to transition from the Current Paradigm to a New Paradigm.

Yes, we all know it. Yet we are stuck in this much needed transition process. Why? To understand that, we need to first look at what are the Current, Counter and New Paradigms.

1) Current Paradigm (Modernism)

What Is

The set of ideas, beliefs, symbols, and narratives most of our globalized Western (and Western-adjacent) societies use for sense-making and meaning-making. It's emergent from the 18th century Enlightenment, propulsed to global hegemony as the scientific-philosophical foundation of the political-economic-cultural order of liberal representative democracy + capitalism and neoliberalism + Western media and entertainment.

Keywords

Reductionism, Separation, Extraction, Objectivism, Universalism, Maximalism, Blind-Optimization, Competitive-Economy

In a Nutshell

We are all individual life forms separated from each other and from the world, competing for scarce resources in order to reproduce and pass down our genes. Solving the objective problem of scarcity is the end goal of society that we should optimize and maximize for. The best way to do that is by quantifying everything in the world into economic assets and allowing agents to compete and trade them in a free market. What people do with their material abundance is either irrelevant or a private matter. Reaching economic abundance is the success goal we should all strive for.

2) Counter Culture or Paradigm (Post-Modernism & Eco-Utopianism)

What Is

The prevalent alternative, it is the combination of postmodernist philosophy and critical studies with an increasingly popular and relevant eco-utopianism. It presents itself as an antithesis to the Current Paradigm, yet it repeats some of the meta-patterns of dogmatism and moralism. Postmodernism mostly came to prominence starting in the 1960's with French philosophers Michel Foucault and Jacques Derrida and has spread across the world through progressive political movements and counter-culture art and entertainment. It has been recently combined with the eco-utopianist cause best symbolized by the hippie and new-age movements also in the 1960s and more recently by thinkers such as Charles Eisenstein.

Keywords

Wholeness, Union, Giving, Minimalism, Subjectivity, Relativism, Anti-Optimization, Gift-Economy

In a Nutshell

All life is one and all life is connected. We can share in the abundance of the resources of Earth, if only we can coordinate ourselves. We cooperate with one another and in other species in a great cycle of life and death that creates ecosystemic harmony. The objective scarcity problem is irrelevant since the abundance is already everywhere at every moment, we must just learn to connect to it and to detach ourselves from the subjective scarcity emanating from our ingrained collective narratives and traumas. We can gift each other what we need, when we need it. Reaching subjective abundance (enlightenment) is the success goal we should all strive for.

3) New Paradigm (Meta-Modernism)

What Is

A proposed paradigm that seeks to integrate non-dogmatically the best available perspectives as how we could live our lives, coordinate and avoid Molochian failures and tragedies. It's emergent from many different fields such as systems-thinking, cybernetics, biomimetics, the work of Ken Wilber (and all its derivatives and communities), and most directly to the Hanzi Freinacht series of books.

Keywords

Multiplicity, Complexity, Both + And, Integration, Context-Based, Fit-For-Function, Non-Duality, Regeneration, Objectivity + Subjectivity, Transition-Economy

In a Nutshell

The world is both competition and cooperation. Both abundant and scarce. Both objective and subjective. All life is one and is connected, and all individuals are unique and free. We should solve both the objective and subjective problems of scarcity (material comfort and wisdom, eudaimonia). We should both create innovations for objective problems and work to detach ourselves from those problems and our ingrained beliefs and traumas. We collaborate, gift, trade and share when possible (+/+), compete in fair ways when necessary (+/-) and minimize net-negative interactions (-/-). We seek to account for all relevant stakeholders and all different capitals. We should seek to provide basic objective needs met for all both because it is right and in order to increase their capacity to seek flourishing. In the crisis context of late modernity, we should individually and collectively seek to regenerate from our traumas and help the environment regenerate from the depletion and thrashing of the last centuries. The success goal we should all strive for is not to reach anywhere, but simply to walk our path however best we can.

Back to why we're stuck

The Postmodern & Eco-Utopianist Paradigm is insufficient as a response to our current crisis. Its an opposition to Modernity, not a continuation. It denies it and seeks to destroy it, not build from it and transform it. Thus the status quo is even more resistant to change and the stuckness increases.

Meta-Modernism is the integrative solution combining the best of both Modernism and Post-Modernism.

And PRISM is the legal-financial model that allows stakeholders operating from the Current Paradigm (Modernism) to easily and gradually transition into the New Paradigm (Meta-Modernism).

How to Transition

Transitioning paradigms means that the majority of individuals on Earth can live by and through a more complex symbolic code (narratives, symbols, beliefs, languages) that allows them to sense-make and meaning-make amidst more complex scenarios, problems and relationships. This requires offering people the conditions, objectively and subjectively, to develop the cognitive, socio-emotional, cultural and informational capacities to handle such code.

This will involve governments but it can't only involve governments. It's not enough and people will still need to learn how to work in this New Paradigm, and the truth is, apart from some particular experiments, we still don't know how these New Paradigm organizations and work-relationships will look like for the multiple stakeholders associated in any specific venture.

Thus, we need an organizational model, that includes legal-incorporation, financial-rights, governance and organizational design (management practices) that is both viable and attractive to stakeholders today but paves the way for the transition into the New Paradigm even as we develop and refine the proposed solutions for what this New Paradigm could look like in practice. PRISM is this model: the Preferential Rerturn Inclusive of Stakeholders Model.

How PRISM was designed

It was designed with one premise in mind: what is one step we can take today that will take us closer to the desired pattern (New Paradigm)? Thus, it is not a crystalized destination and a road to get there, but rather it's more like a set of criteria of how the place we would like to end up looks and feels like and a map with different trails that could possibly lead us there. In order to determine if they will we must look at past knowledge and use our best judgement in order to select the most important and effective experiments to do today to accelerate the learnings.

We are not proposing an entirely new economic and organizational system, rather we are asking what is essential for the destination to be a desirable one, and then again what is essential for us to do and be today in order to increase our odds of arriving to such a place.

This way we hope to engage the relevant stakeholders of the Current Paradigm with an incremental step they can take today and that creates future capacity for the next steps to be taken after that. This is how we change the paradigm: one step at a time, including and not alienating, expanding our capacities and accelerating our learnings.

What is Essential?

So, what is essential for the desired future and for our present in order to get there?

Some of the key criteria for the New Paradigm economic and organizational vision are: Multistakeholder Participation, Multicapital Accounting, Fairness, Transparency, Regeneration of Individuals, Societies and the Environment, Psychological Development, Stewardship, Purpose Centrality.

Out of these, we selected two as starting points that are viable to implement today and increase our capacity for future success: Fairness and Transparency, starting with the Financials. 

Fairness means: reward all capitals invested (money, time, etc), optimizing for financial stability of stakeholders and their capacity for a fulfilling life.

Transparency means: all stakeholders know how much every other stakeholder is getting, and is neither revolted or ashamed by it.

This decision stems from an understanding that 1) morally we should distribute the value created by an organization more evenly across stakeholders; 2) objectively it increase economic abundance for more stakeholders facilitating regeneration of traumas and psychological development; 3) subjectively transparency in compensation also increases trust and capacity for regeneration and psychological development.

Cap Pay-Down

The model is inspired by the OpenAI and Microsoft deal.

It uses the idea of a Cap Paydown of stakeholders, that is a maximum amount of profit to be distributed for each stakeholder.

It then determines a Ratio of Preference between stakeholders, that is who gets how much in what order.

From there, Profit Stages are determined, where in each stage there is a specific proportion in the distribution of profit between stakeholders.

The Open AI deal shown here has four stages, from 100% profit to FCPs to 100% profit to the OpenAI non-profit.

For PRISM we consider 5 main stakeholders: Investors, Founders, Staff, Clients, and a Foundation.

The Foundation is a flexible structure that allows for the different kind of possible exit scenarios:

1. Exit to Non-Profit: Patagonia style, company shares are transferred to a NGO that supports a specific cause (i.e. climate change).

2. Exit to Coop: Shares transferred to a Coop managed by staff/clients/partners.

3. Exit to Community (Multi Stakeholder Commons or DAO): Shares transferred to a Trust tasked with managing the company and the resources considering all stakeholders, society at large, non-human life on Earth, the Environment and the seven next human generations.

Cap Calculation

Each stakeholder, except the Foundation, has a soft-cap on profits to be received.

Investors' cap is determined by a max multiple on their original investment. We recommend no more than 10 times.

Founders' cap is determined by the amount that invested in a safe investment (sovereign debt, for example) yields an yearly income that is sufficient to pay for a comfortable lifestyle for a family of 4 anywhere in the world. This income is calculated by doubling the MIT Poverty Lab's Livable Wage and then adjusting it to the World Bank's cost of living index for the most expensive country in the world. This calculation currently yields about 7.9 million USD for a NYC based founder.

Staff's cap is determined by adding up all individual Staff member's cap, which are calculated by adjusting the Founders cap for each Staff member's salary compared to Founders salary, and time of service at the company compared to Founders time of service (imagining Founders are the highest paid salary and have been there from birth to moment of financial distribution).

Client's cap is a percentage of the sum of Investors, Founders and Staff's caps.

Organizational Stages of Development

The proposed model assumes the company goes through four developmental stages:

Birth Stage: between founding and Product Market Fit (PMF).

Growth Stage: between PMF and the start of profit sharing.

Profit Stages: between the start of profit sharing and complete cap paydown. The Profit Stages are subdivided into multiple sub-stages where the Cap of each stakeholder is paid down in accordance to the Order of Preference.

Maturity Stage: after complete cap paydown.

The stages help us determine both financial rights and governance sharing of the organization. Financially, we aim to pay down the caps in accordance to the Order of Preference. Governance wise we seek a safe and gradual progressive decentralization of the decision making as the company, its stakeholders, its culture and its systems mature.

Order of Preference in Returns

Our suggested Order of Preference is: Investors - Founders - Staff - Clients - Foundation.

In Profit Stage 1 Investors get 80% of profit distribution, Founders 15% and Staff 5%. Once Investors have their principal paid back, (1x ROI - could be adjusted for inflation) we move into Stage 2.

In Profit Stage 2, Investors fet 65%, Founders 25% and Staff 10% until Investors' get 50% of their cap paid.

So on and so forth, until we reach Maturity Stage, where each of the stakeholder classes has a perpetual dividend of 2.5% (thus the soft-cap) and the Foundation receives the remaining 90%.

How to Implement it

I've been researching possible implementations for this legally speaking on three different jurisdictions: Brazil, US and Germany. We're actively looking for entrepreneurs, partners and investors who would be interested in testing this out. If you are one of these, reach out to me at davillemos@gmail.com and I can share the rest of the materials I've developed, contract templates, economic modeling and whatnot.

Conclusion

This is a first proposal of PRISM as a model. It's incomplete and work-in-progress, but hopefully you've been able to understand how we might be able to use it to win over financial capital in its own terms. By giving the preference of return to investors we give more liquidity to their stake while still keeping the door open to a non-linear return on investment, both by the 10x return cap and also by the 2.5% (or other amount) of perpetual dividends to be distributed to the investors.

There are several nuances that have not been mentioned here, but that we might publish later on. I hope this sparks good conversations and that one day in the near future we can use PRISM to enable the first set of Next Paradigm Organizations (like a Fair Shares Commons or whatever they may be).