Introduction
One way to frame MetaDAO is “a place for crypto-native enterprises to raise money that doesn’t suck.” That is, if you need capital to build or grow your business, you have a few options available to you today:- Follow the standard path, selling token warrants to VCs and launching a token in 2-3 years
- Raise venture capital and never launch a token
- Collect creator fees from Pump / Believe / Heaven or a similar platform
- ICO on Metaplex or a similar platform
- Launch on MetaDAO
The standard path is bricked and will continue to get worse
The standard way of launching tokens (hyped TGE, paid CEX listings, 10% airdrop, Labs / Foundation / DAO, linear vesting, etc.) is not optimized for building a long-term business - it’s a playbook for extracting money from retail investors while evading securities laws. If you try to use it to build a long-term business, you’re going to have a bad time:
Some may believe that doing a venture round doesn’t lock you into this path. But we find
that once teams raise money, they feel pretty locked into it.
Never launching a token is reasonable, even if it’s not maximally crypto-native
Some teams don’t plan to do tokens, instead accruing value to their equity as a normal start-up would. We think this approach is reasonable. If you can raise money from investors who don’t expect a token, you should seriously consider it.Launching on a bonding curve is terrible
Recently, a few projects have launched on or considered launching on a platform like Pump, Believe, or Heaven. The main problems with these are as follows:- You don’t raise much money - the median token only makes $10k - $100k in creator fees.
- These tokens don’t have any intrinsic value, and the market will recognize them as such. You may have lots of traders, but you will have few long-term holders
- Snipers will scoop up large percentage of your supply and sell onto your believers.
- “Hey, would you like to come work for our start-up for a below-market salary and 1% of the supply? Yes, someone was able to purchase 1% of the supply for $150, but what does that matter?”
Normal ICOs can work if you have enough trust, do the legal work, and avoid the pitfalls of the standard path
Another option is to launch at a place like Metaplex. Essentially, a 2018-style ICO where you’re given discretion over the money. The problem you’ll encounter is that historically many, if not most, of these ICOs rugged. This has led to wariness among serious investors. So you may be able to get short-term token flippers, but it’ll be harder for you to attract long-term holders. But if you have sufficient trust, and are willing to put in the legal work to align the token and the business and also to avoid following the “low float / high FDV” playbook, then this can be reasonable.MetaDAO is the place if you want to align a community the right way
But if you want to align a community by launching a token and you don’t want to do a bunch of legal, smart contract, and marketing work, MetaDAO is today the place to go. On MetaDAO you get:- A valuable token, which leads to longer-term and higher-quality holders
- Provable transparency - noone will wonder whether you’ve “OTCed”
- To enter the arena early
- A mintable token - you won’t need to worry about running out of supply
- A potential community of early believers