Simone Cicero:
Hello, everybody. Welcome back to the Boundaryless Conversations Podcast series four starting today. In this podcast, we meet with pioneers, thinkers, doers, entrepreneurs. And we basically speak about the future of business models, organizations, markets and society in this rapidly changing world we live in. I’m Simone Cicero and I’m joined today by my usual co-host, Steena Heikkila.

Stina Heikkila:
Hello, everyone.

Simone Cicero:
Thank you, Stina. And, yeah, today, we’re also joined by Chase Chapman, DAO researcher, podcast host, angel investor, inventor of new things on the internet. Hello, Chase.

Chase Chapman:
Hello, hello. I’m excited to chat.

Simone Cicero:
Chase, thank you so much for sharing some of your time with us today. In today’s episode, we’re going to talk a little bit about the DAO landscape and the work that Chase among other people is doing with Metropolis for the inter DAO evolutionary organizational model, and also the connections of the world of DAOs with the traditional organizations and markets.

So, as a first question, probably, it’s a good idea to ask you a little bit from your excellent, I would say, observatory because you’re on this podcast since a while and we’re going to put, of course, in the notes for the listeners all the connections with your podcast; to give us a little bit of a landscape, essentially describing what are the types of D-A-O-s, of DAOs that you see emerging, and consolidating. And maybe also sharing a bit of your point of view in terms of what are you bullish in terms of type of DAOs that you see very useful and potentially gaining stage in the organizational space. And what are you bearish instead, maybe the type of DAOs or spaces where these ways of organizing may be a bit more complex to bring forth? So, a little bit of a DAO landscape, how do you feel about all the types of DAOs that are emerging?

Chase Chapman:
Yeah. I think the landscape for DAOs has changed a lot over the past year. So, maybe it will be helpful to give a little bit of context on where it was about a year, year and a half ago, and now where it sort of has evolved into. When DAOs first started, I think they were very much this heavy on the automation in terms of thinking about how can we take this blockchain technology and create organizations that leverage autonomous sort of elements so that they’re not super people centric. People might be involved, but the very early version of DAOs was something like the DAO, which was created, I think, in 2015, or 2016, which was like an investment, DAO. And people made decisions on investments and those funds were sort of immediately committed. And so there was this element of automation, but also people and I think, over time, DAOs have evolved into something pretty different.

So, over the past, I would say, a year and a half, we saw DAOs going from these, like community owned organizations, that were basically going to be the vehicle for companies to become more democratic. And I think we’re still seeing a lot of that. But what I think we’ve seen over the last year is this acknowledgement that the DAO landscape today is really challenging to navigate, partially because we have a lot of these like monolithic, community centric style organizations. And there’s nothing wrong with that. There are a lot of benefits around having this really heavy focus on community. But often when we talk about community, that really means a couple different things. One, it means token holders, it can also mean contributors, and it can mean users. And so there’s this element of wow, we’re bringing a lot of different stakeholders together. And we’re building these huge contributor bases that maybe don’t make the most sense for every organization to be building, especially organizations that are pre-product market fit, which we see a lot of and Web3, of course, because we’re doing a lot of innovating, a lot of these are venture backed companies that are evolving into DAOs.

And so I think over the last year, we’ve seen the landscape really evolve from quite monolithic DAOs with huge contributor communities like I was talking about, where you have like bounty based work, which I’m sure we’ll get into what it means to break work down to the atomic level. And I think we’re actually shifting more towards this unbundling where we start to see more of this interoperable style modular organization emerge, where we actually have things like service DAOs, which are kind of like agencies that provide very specialized skill sets. And then you have protocol DAOs, which are the teams that manage protocols. You also have things like investment DAOs, which are more like the original version of the DAO which is you basically have a pot of money and now you’re investing in different things, either for profit or to like proliferate a meme. And so I think we’ve really seen the DAO landscape transform into a much more modular ecosystem, which I’m really excited about. And I think that’s where we’re at in the space right now.

Simone Cicero:
It’s funny because it was already a little bit of a hard catch, let’s say, for the average workers, or designers or entrepreneurs to understand how DAOs work. And even, you know, if we think about the early stage, and when we got used to see DAOs more like these kind of distributed decision making systems for investment teams, essentially, like the DAO, for example. And now that seems like the thesis is even much more taking hold in the market in terms of the places where you can use this model, which is, I think, a major assumption behind the thesis of development of your organization, which is Metropolis, and formally known as Orca Protocol.

So, maybe you can double click into why you believe that the atomic unit of a DAO, as you say it, isn’t people or project, but it’s a small group of people working together. So, the team. So, essentially, my question will be why in this changing landscape you see the team, the unit, as such an important player, and you have such a strong bias towards the idea that these teams can collaborate and interoperate, and connect with each other across DAOs, and maybe contribute their work to multiple organization. So, why is the team becoming so much important, so important, into this new vision that you are describing?

Chase Chapman:
Yeah. When I first dove into DAOs, I had been working in Web3 for a while. And I basically spent a year contributing to and researching DAOs. That was my main thing. So, this was before I joined what was then Orca Protocol. And I kept experiencing all of these challenges as a DAO contributor. And part of the way that I was thinking about the space and that a lot of other people were thinking about the space at the time, was that the atomic unit of the DAO is the individual contributor, it’s the person doing the work. And so you saw the rise of bounty based work, which is basically kind of like an individual, much more simplified version of like an RFP, Request for Proposal. Except for typically, you’re actually given the task. And so as a result, you started to see a lot of people doing, like, what they called bounty hunting, which was basically just saying, hey, we need this task, done something like making a video for Twitter, someone would step up and do it.

And that was helpful for a bit. But what started to become very clear was that planning strategic work, and then actually having people execute on that work with the individual as the atomic unit, or perhaps the task as the atomic unit, is actually really challenging. Because not only does it create the sense of disconnectedness from the organization, it also requires the individual people who are interested in doing that work, have really high context, still, they have to keep up with the DAO, and make sure that they’re understanding everything that’s going on. They don’t have this sense of consistency or knowing that there’s going to be work for them in the future. There’s really high overhead in keeping up those contributors, making sure that they have context, but also making sure that they’re happy. And ultimately, generally, what that tends to skew towards is people will say, okay, well, we need a better reputation system, and all of that stuff, because there’s this really high cost to switching different contributors, and all those things.

Ultimately, though, when you look at pretty much every successful human organization, it’s very clear that things are not — big things are not successful when it’s just individual people that are very isolated and doing them. It’s really the magic of organizations comes in when you have really smart people with different specialized skills working together towards shared goals with a shared context. And so as I continued doing this research, while I was actually sort of my own test subject and contributing to these DAOs, every single time I came back to this idea of small groups. And that isn’t to say that you can’t have individual autonomy and things like delegation within a small group. But it’s just that it felt like the space was really lacking a framework for understanding how small groups can play into this DAO ecosystem.

And so I discovered Orca because I met the co-founders a while back, and just kind of kept realizing that Orca, which was what it was called at the time, it’s now Metropolis, was building this primitive around small groups that was actually super powerful. And I kind of just kept coming back to it and coming back to it. And that’s why I decided to get more involved with the team, because ultimately, it was one of those things where I just realized that this is actually a huge missing part of the ecosystem. Again, not to say it’s the only part of the ecosystem that matters. But it became really clear that it was a missing puzzle piece that felt really prominent in terms of my own challenges as a DAO contributor and the tooling that can actually solve those problems.

Simone Cicero:
You made the distinction in some other piece, I don’t remember if it was a piece of podcasts that you were a guest. And you spoke about socialware and trustware. Am I right? Was it your thoughts, right?

Chase Chapman:
Yes. I helped write the piece on socialware and trustware. It was not — I don’t take credit for the idea. That was Julia and John from Metropolis. But I spoke about it on I think Kevin Owocki’s podcast, and now that is a framework that we use a lot which I can dig into.

Simone Cicero:
Yeah, maybe because before I know Stina has another question coming up. But maybe before that, you can maybe double click into this socialware and trustware idea because I found it very useful to understand what DAOs are about. I think our listeners can also use that, the definition. And especially as I understand Metropolis wants to kind of build this trustware element so that there is some kind of interoperability between organizations. It’s like building API’s for teams to interoperate and collaborate across organizations by giving them the right trustware to do so. Am I right?

Chase Chapman:
Yeah. And basically, the idea behind socialware and trustware is in the DAO ecosystem, and I think more broadly, there’s this dynamic between human trust and autonomous systems, or I suppose I should say, automated systems, that is really hard to compare and talk about intentionally when you don’t have words to describe it. But the basic idea is that what the blockchain introduces that’s really exciting is trustware, which is essentially like, we like to make the comparison like what happened when we introduced laws, and moved from like the state of nature into these very specific rules that societies we’re living by. And when you have that foundation, you can build more and more complex systems on top of it, because you have this base layer of trust, that everybody knows they’re abiding by. This is sort of the Leviathan coming to life in the technological form, basically, is this idea that we have some shared baseline that we’re all abiding by, that we can now build on top of.

So, at an organizational level, we’ve really seen pretty much the only foundation thus far for like, organizations is typically laws. And because the blockchain now introduces this idea of cryptographically secured trust foundations, a lot of people are struggling with how much do we rely on human coordination versus how much do we put on chain. And so we introduced this idea of socialware and trustware, where socialware it’s basically just mechanisms that create assurances through human relationships. So, the example that we like to use here is something like a lemonade stand. Technically, someone could come and steal your lemonade. But ideally, they’re not going to do that. The furthest version of socialware in this example would actually be those farm stands where there is no person working it, there’s just social trust, and you leave money and you take the fruit or whatever it is that you’re taking. There’s a really high social coordination cost there, but it sometimes works.

On the flip side trustware is really mechanisms that create assurances through technology. So, there’s a really low social coordination cost. This would be something like a vending machine in comparison. And so organizations are made up of both things, but it’s really important to label those things and acknowledge them when we’re building these types of organizations. And I think when we think about what it means to work on small teams, thus far, we’ve seen really heavy socialware happening there. So, a lot of times there are these very loose guilds, they’re often called, or working groups. But when you put those things on chain, and you actually codify them, you create this again, foundation for trust that people can build on top of and tools can build on top of. And I think that is where things get really exciting.

Simone Cicero:
Can we say and Stina then I’ll hand it over to you. Can we say maybe that socialware it’s needed inside teams and trustware it’s what you need between teams a little bit?

Chase Chapman:
Yeah. I think that’s definitely a framing that makes sense. I think socialware at any level if you strip a system of technology down to its bare bones, all trustware is actually still socialware, for example. If everyone decided to stop believing the US dollar was valuable, or the blockchain was a source of truth, then it wouldn’t be trustware anymore. So, it’s all relative. But I think on a practical level, yes, I think socialware is typically very helpful within teams, and trustware interest is often helpful between teams. That being said, I think there are some organizations where you’ll still have some socialware between teams and some trustware within, but I think that’s a good framing.

Simone Cicero:
And maybe more your thesis than what’s now, you know, as we project your thesis in the future. Stina.

Stina Heikkila:
Yeah, thank you. So, I was wondering if we can go back a little bit just to help our listeners and myself to understand. So, at Metropolis, you are doing this research, right. So, you found that moving from that atomic individual level, then looking at those small groups of people, and how can they play a role in DAOs, right? So, practically speaking, because I think that was an excellent piece as well, that on the socialware and trustware. And I really recommend people to read it, because it made it very clear, sort of what is embedded in the code and what is still, let’s say, the human centric element of the things. But practically speaking, so let’s say that at Metropolis, what is your sort of offer or your current thesis and your — What is in the making, basically, to allow for those small teams to play a role in the DAOs? Can you walk us through that a bit more, sort of practically speaking?

Chase Chapman:
Yeah, totally. So, our product is called Pods. And Pods are the way that you put these small groups of people on chain. So, at a very high level, the way that Pods work is they’re actually a wrapper around this very common primitive that most DAOs use, which is called a Gnosis Safe, you can think of it kind of like a shared bank account. And when you think about what a shared bank account means you have different people who are allowed to use that bank account, allowed to make certain transactions. In the Web3 space, that quote unquote, bank account is actually expanded to something much larger, because it’s not just a place that holds your money. It actually becomes this container for a group of people to do anything that they want to do on chain together.

And so Pods are a wrapper around that to manage who is actually on that shared container, that Gnosis Safe. And as a result, what you actually get is like a membership NFT for the people who sit as members on that Pod. And that allows you to build this entire ecosystem on top of these individual groups of people. So, you can have these NFT’s represent things like voting within a group, and you can do that on chain. But you could also have some sort of interesting, this is sort of a little bit of a tangential thing, but I always like to point it out, because I think it’s cool. So, under collateralized loans are a really big problem in crypto, no one knows how to solve it. You could very feasibly have a product where I am willing to lend up to, let’s say, $10,000, to anyone who is in a Pod or a Pod that is adjacent to mine, you could also have things like Pods interacting with one another in a high trust manner, even if it’s a low trust environment. So, even if they don’t know each other well, they can interact with one another.

And so as this organizational unit, you have not only benefits of creating a more legible interoperable organization for individual DAOs, but you also unlock this potential for DAOs to interact more with each other, which matters a lot as we move into this unbundling of DAOs, and more into this ecosystem of protocol, service, investment DAOs, all interacting with one another in this like highly flexible, highly modular way.

Stina Heikkila:
Cool. Thank you. If we really think about this as a transition, or I don’t know, a transformation of how organizations are built, because I think that is sort of what we envision in the big vision of DAOs and how we organize. How would existing organizations be able to incorporate these kinds of ideas and these kind of products into their way of organizing? Is there a bridge between sort of the existing incumbents and organizations to this, or is it more disruption, or how do you see that?

Chase Chapman:
This is always a fun question. So, I think it’s worth taking a step back before we dive into that piece around what I think is exciting about DAOs at a macro scale. I think ownership and democratizing access to ownership is really exciting. But I think when we think about incumbents and the way that organizations currently exist, what’s actually really exciting and different about DAOs is they do for knowledge work what Uber and Instacart did for things like getting around a city and getting your groceries. It’s really like this gig economy of knowledge work.

And so when I think about what’s exciting around DAOs today, it’s very much transforming knowledge work into like a gig economy style. And we’ve seen Fiverr and others try to get at this, but there hasn’t really been like a structural shift yet. We’ve definitely seen a trend towards, especially as remote work became really popular with the pandemic, there’s been a trend towards companies using more consultants, not wanting to take on not only new people on payroll, but also when things are remote, it’s just outsourcing is much easier, because the friction of not being in the office is already there. So, I think that’s important, like macro context.

When I think about the way that DAOs might shape existing incumbents and all of that, I kind of have like two different approaches. And I can’t really figure out which one is right yet. So, the first one is that DAOs are going to be best for digitally native organizations. And this is a big challenge in crypto more broadly, which is that for years people in crypto have been trying to get everyone else to come on board and organizations to transform into more crypto native organizations. I think ultimately, that’s a battle that’s super expensive and has not very much payoff. I’m much more excited about organizations that are new, and essentially, when I say new, I mean, where Web3 is unlocking completely new possibilities. And that I think, is very much in line with this gig economy of knowledge work and this ability to create incredibly modular organizations. Part of the argument there is that it’s hard to imagine existing organizations and existing incumbents accepting those models.

On the flip side, I do think that there’s an argument that because more organizations are choosing to outsource certain types of work or sort of restructuring, there’s probably an opportunity for them to look more like DAOs. I think the other important element to note here, though, is that one of the core principles of DAOs is this idea of more democratized and distributed ownership among the people who create value in these organizations. And I think it’s incredibly hard to imagine an organization that is already structured in terms of ownership in the way that most organizations are structured, which is either like shareholders, making certain types of decisions or being privately owned. It’s just really hard to imagine that those people who currently own the organizations would want to give up ownership to the people who are creating value in them. And so I think it’s a challenging balance. Ultimately, I think the first argument is probably more of what’s going to happen, though I’m sure that there’ll be some types of organizations that see DAOs as a better mechanism.

Simone Cicero:
Well that’s a very important point, I think, because I don’t want to believe that we have to end up in saying DAOs can only work in certain parts of the economy or in only knowledge economies or digital economies or whatever. I don’t want to do that because, for example, if you look into the TIMN framework from David Ronfeldt, I don’t know if you’re familiar with that, we used many times in the podcast. David Ronfeldt wrote this article, I think, with other co-authors that I don’t remember at the moment, but that introduced this idea that society goes through these kind of waves, right? Started from tribes then moved into institutions, then markets and now networks. So, there needs to be some kind of way that these kinds of network based economy fits into the existing and transforms it essentially helping us to transcend it.

So, maybe that’s a good way to connect with another topic that I wanted to talk to you about, that is this idea of — which I call essentially, ontological convergence. So, I think there is a lot that deals with converging on shared languages, when we think about operations, sorry, organizations cooperating. So, for example, we saw these with a traditional idea of standards or trade agreements, when it comes to more traditional economies. And it looks like Web3 and all these digital natives’ world that is transforming finance and digital products to some extent, ownership and arts like the NFTs, is having a very hard time converging on shared protocols. So, you see, many times people coming up with new protocols, new ideas and rarely, there is a convergence on an existing protocol, for example. What is your thought in terms of this kind of role of convergence, ontological convergence, adopting an existing domain model when we think about any part of the economy?

So, for example, you are with Metropolis, you’re working on how teams or you know, Pods are described, how they can collaborate. This is a language, to some extent. So, are you wondering, for example, how you’re going to drive the adoption of the protocol you have been designing in your product into making other organizations adopt to the same protocol. And among these organizations, the question is, how can we get existing organizations, so incumbents at every level of the value chain? So, I know that is a very fancy question. But the point is, how can we or how can we expect that ontological convergence and I would say, an intentional decision to collaborate between players through a shared protocol, a shared language that could make this collaboration happen even between incumbents and new digital native organizations? How can we expect this to happen or how we could that this is not going to happen? So, we’re going to waste a lot of time in creating 10s of protocols that basically do the same thing, and don’t really collaborate, interoperate with each other? Because I know that you are also very much into this idea of interoperability.

Chase Chapman:
Yeah. So, okay, there are a few things to unpack in this. I think first, it’s worth acknowledging why we have not seen more convergence, or why we have not seen more DAOs and projects built on a shared protocol, because that is like the base layer here. So, the challenge that we’re facing in Web3 today is that there is always an incentive, because we are early to build at the protocol layer instead of at the project layer. And a perfect example of this might be something like crypto kitties, which was this big NFT project in 2017 really blew up brought a lot of people into the space, super user friendly experience, it was on Ethereum, which is the blockchain that’s most common today, I would say. That team then went on to build flow, which is focused on, which is a blockchain, a totally different blockchain, that in some ways, competes against Ethereum, and is focused on building really great user experiences.

What’s important to note there is they built crypto kitties as an application on top of Ethereum first, but then decided to build their own protocol. So, you actually have divergence, and you had convergence that turned into divergence. And there are a couple of reasons for this. One, economically, it always makes more sense to spin up a new protocol. But also, there were challenges with Ethereum, it was really slow, which made it incredibly not user friendly. And it was very expensive, that made it so that that team needed to build a totally different protocol if they wanted their application to scale. And by doing that, they created opportunities for other projects to build on a scalable chain. And so I think a lot of what we’re seeing is not necessarily this inability for interoperability to exist, it’s more so that we’ve experienced a lot of the pains of being early. And so oftentimes, what we see is teams realizing this protocol doesn’t work and iterating on it themselves.

So, I don’t think it’s that the industry is not able to have this like ontological convergence. I think it’s much more that we are just very early, and people are constantly building on each other’s work. And the other thing that matters here is that work like in this space in Web3, open source is the standard, it is the default, everything is open source. And so you can easily fork a blockchain and make your own version and iteration of it. And I actually think that makes us better. Now, it means that we don’t see some of the network effects that you would see if all of these things were happening on the same protocol. And I think that’s totally okay. Because ultimately, it’s creating this competition that’s making everyone better because of it.

When it comes to DAOs, and all of the different approaches to do we build on top of shared infrastructure, do we create our own infrastructure; something that Metropolis has made as a very conscious decision is actually to not require people to be on our own protocol. We wrap around Gnosis Safe like I was talking about earlier, which is the most widely adopted set of smart contracts for DAOs, probably by a longshot. And so rather than building our own new protocol, we’ve actually built a protocol on top of theirs that just adds functionality and adds this ability to have relationality and interoperability between the specific spaces that the existing protocol already instantiates.

So, I think that is a really important element to this whole puzzle is that, A, I think the fact that we’re seeing new things pop up all the time, rather than people building on existing infrastructure is actually just because we’re pretty early. And you’re actually seeing less of that now than you were probably three or four years ago, which is really exciting. B, builders like Metropolis are essentially choosing to build on existing infrastructure and make it better, instead of building our own fork and our own version. And then finally, I think more broadly, what we’re going to start to see in this space is Metropolis is an open protocol. So, we aren’t like some sort of centralized organization, storing your organizational blueprints, it’s all using smart contracts. So, it’s on chain, anyone can read from that data, all of that. And from that perspective, I think what we’re going to start to see is more open protocols in Web3, where hopefully, it used to be that in Web2, you could have this moat by like dropping users into your platform. With protocols, you no longer have that because all of the data is on chain. If a competitor wants to come in, and what we call vampire attack your users, basically, see who your users are, and try to get them onto their platform, they can absolutely do that.

Now, when it comes to bridging existing organizations that are not web three into the web three space, I think there’s a really exciting opportunity for using these open protocols to onboard different types of organizations, and have them sort of join in the network effects that we’re seeing in this space, like things like Gnosis Safe, because it is a protocol that most people use, you can see network effects starting to bubble up. I think the really important thing here is that existing incumbents and organizations don’t try to build their own version yet again, unless they feel like they need to iterate on it. And that’s where that tension comes in, is do we build on top of something or do we potentially, not all projects that have iterated are like this, but there is like a money grab involved if you wanted to build your own new blockchain or tool or whatever. And so I think it’s going to be a really important balance to try to make sure that organizations that are coming into this space that are not Web3 native are adopting open protocols and building with an open protocol mindset.

Simone Cicero:
Yeah, I mean, it’s interesting, because the Gnosis Safe is essentially can be seen also as an interface to existing organizations, right? Because at the end of the day it’s a wallet, right? It’s a way to manage a wallet through multiple keys, essentially. And so you can think of an existing team kind of existing outside of the blockchain, let’s say, outside of Web3, and connecting into Web3, through this interface, right? So, to some extent, it’s essentially an innate way to integrate existing organizations into the layers, right, into these kinds of layers. Chase, please go ahead.

Chase Chapman:
Yeah, it definitely is. And something that I always tell people, when it comes to bringing organizations into the space, I think you’re right around Gnosis Safe being this relatively simple way to integrate teams into the ecosystem. I think one of the best ways that organizations can interact with the Web3 space is not by trying to onboard their entire organization. I think the compatibility around some of those pieces is still something that is challenging to figure out, and just ends up being really, really high overhead, which you see a lot. You see organizations saying we’re going to become more Web3 native, and then they don’t do any of it, because it’s really hard for them to interact with the Web3 ecosystem because of these like foundational organizational infrastructure pieces and all that.

So, I think the best way to do that is actually to say, as an organization, we’re going to create this or choose a certain team that is basically going to be our Web3 experimental team. They already did this very well. They had a couple of people who were highly focused on DAOs that dove in very deeply. I think you need that type of team that is basically a Web3 native style team sitting within your organization, just how you’ve had little — I know, this was a big thing of like the 2010s was having innovation units within different larger organizations. I think it needs to be the exact same way. Otherwise, it ends up being this very expensive effort that actually has very little payoff, because getting your entire organization to reap the benefits of being Web3 native requires that they actually become Web3 native which is very challenging to do. So, I think a much smaller team with a little bit more autonomy to do experiments is a much smarter way to approach it.

Simone Cicero:
Yeah, maybe I can try to make a kind of an example for our listeners to understand what I mean here, what we mean here. So, for example, let’s think about Ford Motors, like you know, wanting to develop a new application based on data on the consumption of energy of cars, electric cars. And wanting to do so they may be discovered that exists a DAO that was basically featured also on the podcast, called DIMO, that creates data in this Web3 space. And let’s say that Ford Motors wants to enable a team to start interacting with this ecosystem by building products. So, maybe they have to even invest into specific developments, may be the need to participate into grants or interoperate with the DAO to a certain extent, which is essentially, for example, I don’t know investing into an existing team, sub DAO team in DIMO that is developing a certain functionality that they need Ford Motors to improve their application, something like that.

So, this team will have to, let’s call it, you know, the energy monitoring team that is developing these applications has to interoperate with DIMO data, has to interoperate with the sub team in DIMO that is developing the data standard, or improving the functionality of the protocol. And so a way to interoperate would be, for example, to invest the money into a grant or invest money into a team that is developing certain features. So, my question for you would be maybe, to clarify, what are the primitives that you are embedding into a metropolis so that, for example, this protocol could be adopted by one side by a DAO, like DIMO saying let’s use Metropolis protocol to enable our teams so that some other players like Ford, for example, can call some of these primitives to make their existing product teams able to interoperate with the teams of the DAO. Am I right to kind of picture this use case?

Chase Chapman:
Yeah, I think this is a great use case. I will say just before I dive into it, our current focus is definitely not organizations like Ford only because it’s really expensive and time-consuming to onboard organizations that are not Web3 native. Like, our focus is very much organizations that are already on chain that see the value of being on chain. You know, there are definitely other organizations, maybe years from now, that will be our focus. So, I’ll take like a five-year view, maybe not five, three-year view of this. So, one of the things that’s really exciting about Pods is that, yes, it allows us to codify existing organizational units, you can take these two teams. What’s exciting, though, that Gnosis Safe doesn’t have really alone is this relationality between teams.

So, today, you spin up a Gnosis Safe, there are all kinds of modules that you can add on to it. But at a very basic level, you have the shared bank account. What Pods actually allow you to do is establish relationships between these organizations. And the way that we do this is essentially nesting. So, you might have a new Pod spun up that is for the two groups from Ford, and what was the DAO called DIMO? So, for the Ford Pod and the DIMO Pod, you can actually spin up another Pod that they are both members of that gives those two Pods like a shared bank account for the experiment, or a shared container for resources, for permissions, for all of these different things. And so by doing that, you basically create these containers for collaboration that are super, super modular. You could also if you wanted to have the main collaboration Pod be the admin of the two Pods. You could have all these different things. And ultimately, what that allows you to do is create relationality between the different organizations. And that seems so simple, like you can nest two Pods within a Pod, but you can’t do that today. And what that means is you’re relying on socialware between the organizations to facilitate a collaboration on a trustware level, which doesn’t work.

And that’s where you get into this like digital cities thesis. So, we rebranded from Orca to Metropolis. And one of the main reasons was we felt like cities were this actually really, really good mental model for thinking about complex systems. And one of the main things that you need in order to develop a sufficiently complex system is relationality among the elements. So, you can’t really get that much done if you’re a heavy trustware organization if you cannot develop trustware encoded relationships between these specific entities.

And I guess to take a step back, when I say things like permissions, what I mean is, these two organizations might be able to develop a shared space for this, like data sharing concept. Who can access that data is probably important. You can actually codify that using Pods. You can say only this group of people, only the people who are within this Pod, which would be made up of the DIMO Pod, and the Ford Pod can access this data. And so you start to see all of these different ways in which you can actually create highly relational, like synergies between different parties, which totally opens up the design space for what’s possible and what can emerge.

Simone Cicero:
Would you maybe double click into, for example, these primitive of nesting that you described? Would you kind of describe a few other primitives that exist in the Metropolis protocols, so to make it more chewable, more understandable for the people listening to this in terms of understanding what Metropolis is really about?

Chase Chapman:
Sure, yeah. So, at the very basic level, a Pod has members, which are either individuals, or they can be other Pods. And so Pods at a very basic level, develop relationships between groups and other groups, and then groups and individuals. When you put those things on chain, what you actually get is this permission’s layer, which can mean permission to access this sort of shared bank account. It can mean permission to access certain types of data. There is something called verifiable credentials, which have been very popular in the Web3 space over the past six months, because you need a way to have private data that is still accessible via the blockchain. So, things like permissions to access verifiable credentials. You also have things like permissions to write to certain protocols, to modify certain protocols, to put certain things on chain.

And ultimately, it’s this combination of a dynamic ledger of basically who is in an organization, this nesting, which is essentially coming from the fact that a Pod can be part of an organization, which is where you get nesting. And then on top of that, this permissions layer, which allows you to do a bunch of different things. So, those are really like the two primitives that make Pods magical. Anything that you build, on top of that, you could imagine if Ford’s organizational blueprint actually was on chain, onboarding to something like Slack would actually be much more simple because all you need to do is read which members exist in which parts of the organization, you can see all of that on chain. Now, this is actually much more useful for DAOs, because they’re already doing a lot of things on chain. They’re doing things like salary payments on chain. And so if you could just simply read from the organizational ledger, that stuff just makes it a lot easier as well.

Simone Cicero:
So, we can imagine in the vision of such protocol things such as, for example, salaries or revenue sharing agreements, or I don’t know, splitting, flows of money going from here to there, a lot of this is related to financials, am I right, and credentials, you said?

Chase Chapman:
So, I think early on, it’s related to financials. Like today, we’re seeing most of the DAO tools that have seen any amount of success are basically payment tools. I actually think we’re going to see this change a lot, though, over the next year or two, because financials are really scratching the surface. This is how you also saw the crypto space evolve from finances to now culture and identity. I think the same thing is going to happen where, right now DAO tooling is mostly focused on financials. But later on, you could actually see — A quick little side note, there’s this project called Meta Label, which is all about essentially labels creating culture through these things called Drops. So, it’s all about defining a group of people who are effectively working to create culture by creating products or media or whatever, you could have a Pod where permissions to help create culture and help do these Drops are actually defined by being in a certain Pod. So, I think yes, today it’s financial, I think in the future, it’s going to expand out and do a lot more.

Simone Cicero:
We can think of, for example, I don’t know an organization having some production kind of controls, for example, deciding how much of some output, you know, imagine a factory for example, and the team and managing this whole factory, being able to set their own configurations, let’s say for the tuning of production and maybe empowering this team to control these tuning elements on their own, you know, because they have these freedom of delegation of freedom on acting on these parameters in their own control. And these can be programmable through something like Metropolis protocol. Stina, you have something to add?

Stina Heikkila:
When you’re saying that’s sort of in a pipe dream that I work a lot in public policy and trying to manage different ecological and social transitions that we are seeing. And I always get quite excited about thinking about what those tools would be able to contribute to those kinds of claims that are being made. I’m thinking now, for instance of net zero, there’s a lot of talk about that at the city’s level at company levels and so on. And I see this as somehow offering a new set of tools that could make such claims much more, let’s say, easy to be held into account by different stakeholders. And that’s something that I would be very interested in seeing if it could evolve in that direction. I don’t know, Chase, if you’ve seen anything in that way, but that sounds relevant to me.

Chase Chapman:
Yeah, I think a lot of these cases, we’re still working through exactly how that translates and how these pieces all come together. I think, like, obviously, cities is a really interesting use case, in general. I think there’s a lot to understand about the way that these types of systems already exist, and where we can plug in and again, like where it makes sense to plug in verses where there’s just too much like oppositional force.

Simone Cicero:
I mean, you could imagine a citizen group being entitled to decide over some kind of budget elements and program these rights through something like Metropolis protocol, something like that.

Chase Chapman:
Yeah. And I think — I mean, it’s interesting. So, some of this reminds me of Balaji’s most recent writings around these like, sort of nation network states, but that almost compete with nations. And again, this comes back to like this through line, which is this question of how much has technology fundamentally restructured what we’re doing to the point where these types of systems are actually incompatible with old systems. I think Balaji presents a really compelling case in his book that basically, no matter what citizenship through something like Pods, and being able to make those decisions will definitely be compelling and a use case, it’s just a question of, is it going to be existing nation states, or is it going to be more of these, like network states? I think they’re not mutually exclusive. And I would love to see local governments onboarding onto Pods.

I think the challenge that you start to face is just that, like Web3, onboarding is still pretty bad. And we need to get to a point where there are enough people who are comfortable using the technology. Because I think the last thing you want to do is disenfranchise certain types of people because they’re not able to leverage and make use of Web3. So, I think we’re definitely a few years out. There are a lot of projects who are working on Web3 onboarding. And I think that infrastructure is going to be required realistically, in order for this type of technology to be useful at things like a government level.

Simone Cicero:
Right. Chase before we close, and I think this conversation was very deep into creating new questions, I would say, or new perspectives, let’s say in terms of seeing how these technological innovations can really fit into the existing practices that we have in the institutional organizational world, we are kind of inaugurating a new practice here in the podcast for this year, that basically revolves around asking to our guests to share what we call breadcrumbs. So, some kind of things that we want to share with our listeners that those can be, I don’t know something that you’ve read; a book or an article, or maybe a movie that you’ve seen, or you watched, or maybe, you know, anything else that you believe our listeners should look into. And it can be one, two, three, whatever you want. But essentially, imagine you’re leaving some breadcrumbs to our listeners, what would they be, and you can take a moment to think through this if you want.

Chase Chapman:
There are a couple pieces that come to mind. So, in terms of DAOs, I think a pre-history of DAOs is a fantastic piece that I would highly recommend giving a read. I struggle with reading, and especially long pieces. And this piece is definitely long, but it is so good, it is fully worth doing. The other piece that I’ve been processing a little bit that is not directly related to DAOs, but that is really shaping my understanding of where this space is going and also really captures better this idea of cultural production that I was kind of hinting at is a piece by Toby Shorin called Life After Lifestyle, which he published very recently that does a fantastic job exploring cultures and what it means for brands to create culture, and all of those pieces. So, those are two phenomenal pieces that have definitely shaped the way that I approached this space and also the way that these organizations are evolving.

Simone Cicero:
Thank you so much. I mean, again, congrats for the work you’re doing with Metropolis, the work you’re doing with the podcast, which our listeners should really look into. And we’re going to add all these notes in the podcast notes. I think that’s a good place to end our conversation. So, Chase, thank you very much. I hope you enjoyed being on the show with us.

Chase Chapman:
Yes. It was so fun to jam on a few of these things, and I’m glad we got to dive in pretty deep.

Simone Cicero:
Yeah. We tend to ask these kind of difficult questions that normally takes a week or so to really chew up and digest. So, thank you again for being available. And Stina, I don’t know, maybe you want to add something more before closing?

Stina Heikkila:
No, great to have your Chase. Good opening episode. I’m not sure if we managed to be more down to Earth than we set out because our questions, like Simone said, they tend to go very deep into the rabbit hole. So, thank you so much for sharing your insights. And I really also suggest reading the pieces on Metropolis. You have great writers in your organizations, including yourself. So, that makes it very understandable. So, that’s something that I would really recommend to our listeners.

Coming back to the show notes, that you can find on boundaryless.io/resources/podcast. That’s where you need to go find a chase episode and you will find listed everything that has been mentioned in today’s conversation. To our listeners, we catch up soon and remember to think boundaryless.