Thread by @TheHypeMan2019

1/ NFT discussion series by @paji_a #13: "What is a DAO? - The NFTJPN Journey Part 3" #NFT #NFTcommunity #anime #japan #pajiEnglish #NFTJPN

2/ Today, I will continue discussing "What is a DAO?" in preparation for NFTJPN's conversion to a DAO. In the absence of blockchain, a "company" was the best solution in most cases as an organization to achieve some vision,

3/ and for NFTJPN, a common organization "company" was also an option. But we chose to become a DAO.

4/ The advantage of being a "company" is that it can gather management resources such as people, goods, and money to maintain and develop its business and services,

5/ direct and guide its employees to work, and handle financial functions such as the stock market that provides liquidity of capital in accordance with the laws set by the state, such as the Companies Act.

6/ By legally developing an "equity structure" that expresses the voting rights and market capitalization that determine the course of the company, organizations were able to obtain

7/ financial functions to mobilize capital, such as obtaining risk money, etc. DAOs using DeFi also have global access to these financial functions without the backing of the state.

8/ To put the role of a company in a nutshell, a centralized high-level executive makes decisions on how to distribute resources such as people, goods, and money, which are tied to the organization,

9/ in order to develop services and realize the vision. Resource allocation decisions are the most important central function of a corporation in realizing its vision.

10/ For example, suppose an organization has 100 million yen in cash, or money. The decision-making process for resource allocation is to decide whether to use it to develop the next service or to increase the salaries of employees.

11/ The higher-ups decide whether to spend all of the money on one side or to allocate it in a balanced manner, and they steer the organization toward the realization of the vision.

12/ As the organization grows, it will be able to utilize not only the 100 million yen in "money" but also resources such as assigning talented and skilled "people" to the appropriate teams,

13/ real estate such as facilities and land, and "goods" such as intellectual property. The majority of these decisions on how to use and allocate resources will be made by the "top management".

14/ A "company" receives "money" from its users through its business and services, i.e., it earns revenue to continue and develop its operations. In the case of a company,

15/ how to spend most of the revenue is determined by the decisions of the company's shareholders, directors, management team, and other centralized entities = "important 'people'" of the company.

16/ As the scale of the project grows, it is inefficient to ask the top management to make decisions on small amounts such as 10,000 yen each time, so the layers are divided, for example, up to 1 million yen can be approved on site. It is reasonable to decide quickly.

17/ Authority to make decisions is
Employee - up to 10,000 yen
Section manager - up to 100,000 yen
General manager - up to 1 million yen
Directors and officers - up to 10 million yen

18/ President - up to 100 million yen
Board of Directors - up to ¥500 million
General shareholders' meeting ... 500 million yen or more
The higher the influence on the organization, the greater the escalation to a more centralized entity = an important person.

19/ Department heads, officers, and the president are responsible and authorized to approve the budget under their own responsibility and authority (depending on the amount, it may be a board resolution or require shareholder approval).

20/ Companies of a certain size have a top-down, centralized pyramid structure in which the decision-making authority for budget execution is laid out by layer, and the amount of money and the weight of responsibility are balanced.

21/ Since money can be easily layered in numerical values, I hope you have understood that decision-making on resource allocation in a company is centralized, and that the majority of financial resources are in the hands of "important people".

22/ It is not possible for an employee to immediately execute a billion-yen acquisition because it is a shortcut to the realization of the vision.

23/ People and things as well as the high influence points in the organization are also determined centrally in the same layered structure. For example, an employee cannot sell off a magnificent office building without permission,

24/ and a corporate officer cannot become president without permission, because the central functions are controlled by "important people" in a pyramid-like structure. To be continued in the next thread.

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