The community we have today is excited and active. Upstreet is a beautiful place in the Metaverse where we can meet, show off our avatars and, soon, so much more.

The initial demo is impressive. But I’m talking to a lot of people who are outside of the crypto community and are looking at this like-- why would you take something so cool and attach all this baggage to it?

As one investor said to me, why crypto?

Why DAO? Why now?

We need to be clear-eyed in our thinking and our actions.

The Case For The Corporation

Corporations are highly optimized for business success. It would be a lot easier to just build a company, raise money and build this thing like a traditional startup. We can go ahead and focus on our AI data engine plan and raise VC much more easily. Decisions at all levels could be quickly made by executives instead of deliberated by committee, the organization could move rapidly, and everyone would be very aligned behind the goal of growth and prosperity.

Corporations are well suited for interfacing with the real world, handling legal risk which is inherent to online platforms, and all kinds of other practical things. The corporation is owned by stockholders, usually with the people contributing the most having the most stock.

That Sounds Pretty Good, But…

Many games have communities that stay for generations. There are people playing Second Life and World of Warcraft with their kids, who are going to be the age they were when they started. It is possible that Fortnite is like The Beatles, it’s just something that people in 50 years go back to when they want the “old games”. Some networks become institutions, with people who care about them a lot and want them to survive forever.

What often happens in these communities is that the incentives of the development team and community drift apart. The development team changes policies to extract more money. The community feels abandoned. People complain, and look for other, newer communities. Communication between the team and community stops. The project is dead, or rugged, or abandoned, or not the same as it was in the good old days.

Yesterday, Unity made an example of what happens when a company becomes missaligned with its core community:

Game developers furious as Unity Engine announces new fees https://www.theguardian.com/games/2023/sep/12/unity-engine-fees-backlash-response

Unity announces a ‘Runtime Fee’, which will charge developers each time a game using the engine is downloaded

After years of having a free runtime, Unity has decided to add a tax to their product. Unity fundamentally changed their deal, and users have no way to leave without completely remaking their games and products.

Misalignment happens a lot because different parties have different incentives. The best solution to the alignment problem is to remove the sides entirely. When the community funds the development they can make decisions which can strengthen the community instead of alienating it.

The Case for a DAO

A DAO holds the potential for ensuring the longevity of the community. By having the DAO finance the developers, we foster a harmony between the devs and the community and sidestep the tragic mistakes that companies like Unity have made.

By adopting the DAO approach, we’re accepting hardmode in the beginning because late-game it means that Upstreet continues to be a cool place to hang out without being corrupted by the man.

We need to train AI models to make better ones for the game. This means capturing data from users. It’s sort of inevitable, it’s just how it works. But we can build this in a way that users can opt-in and understand the ramifications, and if a community controls these systems then there will be far more transparency and collective buy-in.

So Obviously We Should Do That…?

We need to face some realities about communities.

Communities are just randoms getting together on the internet. A lot of randoms on the internet are really cool people… but we also have a lot of weirdos, too. Most of us are probably a bit cool and a bit weird. We try our best and we have our struggles. Sometimes we want to help, but we don’t have the right information. and so instead of the person who can fix the problem being able to, they end up explaining the problem to us so that we can weight in. It is challenging to be, as an unpaid community volunteer, fully cognizant of the realities of the entire organization, and without effective tools to record and communicate information this have have compounding time costs on key decision makers.

Also, there are lizard men believers and assholes. Some small percentage of any community is sociopathic, insane, power-seeking, delusional or self-destructive.

There are also a lot of legal realities. We live in a world that is set up to govern certain kinds of entities which make money, namely corporations. A DAO is not a corporation. It’s more like a membership club. To own servers, services, etc means the DAO needs to have some legal footprint, or someone needs to take legal responsibility for it.

How We Can Overcome These Challenges

We need to minimize the time wasted on communication, free up key decision makers to make decisions, focus on a really fun product and grow. We need to build systems where

Representative Governance means that votes are decided by delegates. Governance necessitates the involvement of individuals dedicating substantial time and expertise to the project. Representatives in our DAO are people who are paid by the DAO, either on the dev team or adjacent teams, so that they are aligned and focused.

Rewarding contributors with governance rights is a mechanism to incentivize contributions and foster an all-in-this-together culture where the primary return on investment is the realization of a product vision unhindered by self-interest and quick gains.

Hire from within whenever there are open positions. Ideally the DAO could contract everyone involved in the DAO, buying total alignment.

The DAO has to run like a business or it just won't survive. If we aren't growing, enabling economy and generating enough revenue to keep the servers running then there won't be a game.

We have to be product focused. Traders are not game devs. If our direction is decided by whales who want to cash in on their land, we're always going to focus on features that enable that economy instead of gameplay or innovation.

We probably need a company anyways. The DAO can subcontract a company to run servers and manage everything, as well as devs in that company. This buys us the same alignment of community → devs but also gives individuals legal protection.

So we’re not doing crypto ;)

The meta has to change. In a time when CS:GO skins are actually more expensive than most NFTs, there’s no reason to use a silly acronym that inspires so much hate in normies. Let’s just call NFTS collectibles, or items, or loot.

You can use crypto if you want to in Upstreet, but you don’t have to. The main benefits of, say, minting an item you get in Upstreet is that you can keep it forever and take it with you to other platforms.

Crypto is a very useful tool for very specific things within a metaverse ecosystem, including facilitating digital identity and interoperability of assets, code, trust, etc. Crypto is also fundamental to identity for AI agents. I foresee virtually all money becoming digital money some kind of cryptographic or blockchain mechanism.

We need to change the meta and evolve our messaging, ejecting the old language in favor of a more inclusive one, and normalize the technology by using it where it's actually good. People change their mind about crypto when they see it used for something useful.

This doesn’t mean that we’re abandoning crypto, we’re just talking about items in a game like it’s any other game. If you want to participate in the crypto economy you can, but you don’t have to. Upstreet is a space for everyone.

Let’s Try Some Things

We’re talking to several potential partners with deep experience in web3 about funding the DAO path. Nothing is set in stone yet, but I’m hopeful. The corporation path is more reasoned and realistic, and a lot less work to just get started and build… but I feel like this project is about doing hard things.

I imagine Upstreet in 100 years, still buzzing with energy, managed by a generation of people I’ll never meet who found their home on The Street. I think that kind of longevity is only possible if we embrace a new model.

Would love to hear your thoughts. Join the discussion on Discord.