How to build your DAO tooling stack

DAO tooling is the set of software, apps, and smart contracts a DAO uses to operate. Think of DAO tooling like business software or SaaS (software as a service). DAO tooling includes all products and services your DAO uses to operate.

Why do you need DAO tooling?

Without DAO tooling, your DAO members won’t be able to coordinate, send funds, pay contributors, hold meetings, or share information. DAO tooling is simply how you run your organization!

What types of tools do you need in your stack?

You’ll need tools to fit the following needs:

• Communication and coordination
• Voting and decision making
• Finance and contributor rewards
• Membership tracking and platform gating
• Broadcasting
• Legal

Communication and coordination

This category includes everything your DAO contributors will use on a daily basis to talk with each other and coordinate. It's a difficult balance of making sure your DAO members have access to the right information, without making the information public to too many people. Editable Notion pages and Google Docs can be a playground for scammers if not properly gated.

Platforms:

• Async conversations: This will be the home base for your DAO. Platforms like Discord and Slack are good for large group communication with integrated voice calls, and Telegram and Signal are good for small group chats and one-on-one communication.
• Documentation and note-taking: You’ll need to store your documents, wiki, plans, projects, and notes somewhere. Notion, Google Drive, Github, and Skiff (web3-native) are all options.
• Meetings: Many DAOs hold meetings in the voice channels of Discord, but for video calls held outside of Discord, Google Meet and Zoom are alternatives.

Issues you may run into:

• Permission management: If you choose Notion or Google Drive for your documentation hub, it can be hard to securely share documents without making them public to the entire internet, since most DAOs don’t use company email addresses.
• Bot detection: Discord servers can get overrun with bots quickly if you don’t implement a way to gate the server.
• Secure meetings: Similar to the issue of permission management, it can be hard to have secure meetings if you don’t share a company email address. Getting in the habit of keeping sensitive and non-public meetings in safe locations (such as a private Discord channel or password gated Google Meet) is good for contributor safety and for preventing zoom-bombing or a bot takeover.
• Information security: Keeping sensitive information secure, such as wallet addresses, can be difficult in an open environment such as a DAO. Gated Notion pages or Google Docs can help with this, but only if you’re tough on making sure others don’t share links to pages that are universally editable.

Voting and decision making

This category includes all the platforms you use when your DAO needs to make decisions. Some DAOs vote entirely on-chain, meaning their votes are cast and recorded on the blockchain, then the result of that vote is automatically executed via a smart contract. Other DAOs use mostly off-chain platforms, such as a polling software. A mix of both on-chain and off-chain has become commonplace in the DAO space.

Platforms:

• Discussions and debates: Ideas need to be shared and vetted before going up to vote. For this step, most DAOs use a traditional forum built on the open-source Discourse software. For more on best practices for DAO proposal processes and formats, read this guide.
• Signaling votes: Off-chain votes, which share the will of the voters without automatically executing an action, are often called signaling votes. Snapshot is the most popular platform for this. DAO members sign in with their wallets to cast token-weighted votes.
• On-chain voting: Governor Bravo (open-source code), DAOhaus (front-end UI to a smart contract), and Aragon (front-end UI to a smart contract) are platforms you can use to create or plug-and-play smart contracts that automatically execute votes on-chain.

Issues you may run into:

• Fragmentation of an initiative: If your discussions and votes are held across multiple platforms, it could cause some initiatives to fizzle out as they move through the process.
• Deciding between on-chain and off-chain (or a combination): It can be hard to determine if your DAO should run entirely off-chain and use multisigs to execute transactions, or if you’d like to execute decisions trustlessly (meaning no humans are involved in the process) on-chain via a smart contract. You could also run your DAO on a cheaper chain, like Polygon. For more on choosing the best blockchain for your DAO, read this guide.
• Regulation and moderation of the forum: You’ll likely need someone to act as a forum manager to ensure it doesn’t get too messy (creating categories and archiving old conversations) and that conversations stay civil and kind. Setting ground rules for interaction on the forum can be a good start.

Finance and contributor rewards

One of the key features of DAOs is the ability to hold your organization’s assets in cryptocurrency stored on the blockchain. Not only will you need to pay both full-time and bounty contributors, you’ll also need to give the right people access to manage the treasury and initiate token swaps. Or, if you’re running your DAO entirely trustlessly, a governance mechanism to grant access to manage the treasury will be essential.

Platforms to consider:

• Multisig wallets: Teams will need to be able to initiate transactions to pay contributors and buy services. Gnosis Safe, Parcel (built on Gnosis), and Aragon Finance (part of Aragon Client) are options to store your funds. These platforms allow you to move funds if you have a certain number of signers. For paying contributors and initiating small transactions and token swaps, multisigs are the most common route.
• Peer-to-peer reward system: One unique way to pay contributors is through a peer reward system like Coordinape. Contributors grant each other GIVE tokens based on perceived value output throughout the set time period, such as a season or quarter. The number of GIVE you receive then translates into your protocol’s token, which is sent to your wallet.
• Posting and assigning bounties: Dework and Layer3 are popular bounty solutions. These platforms are where DAOs post bounties and contributors pick them up, kind of like freelancers on a gig economy platform.

Issues you may run into:

• Multisigs have a trusted element: Because multisigs are really just groups of people with signing power for an action, if multiple of your multisig signers leave the DAO or become malicious, you could be put in a tough spot. It’s common for DAO members to hop around to different DAOs, so even just getting people to sign the transaction in a timely manner can be tough.
• Diversifying the multisigs’ holdings will require many actions from signers: If you’re trying to make many token swaps, your multisig signers will be on duty to sign many transactions.
• Peer reward systems can become a popularity contest: When Coordinape circles are too large of a group for members to clearly know who took on which task, it can be tough for members to allocate without falling into a popularity contest. DAO members may allocate more GIVE tokens to individuals who they see are more active in channels or meetings, but frequency of meeting attendance or channel chatting might not reflect the quality of their contributions.

Membership tracking and platform gating

You probably won’t want every Notion page you write or Discord channel you talk in to be open to the entire internet. So, you’ll need membership tracking and platform gating solutions as part of your DAO tooling stack.

Platforms:

• Membership tracking: POAPs are on-chain badges that contributors can earn for attending events or completing tasks. Think of them as NFTs that you earn for completing something, or for being considered a member of a group. You can mint poaps for free at poap.xyz.
• Platform gating: Collab.land and Guild are platform-gating tools that allow you to token-gate your Discord server, Discourse, and more. Collab.land is also useful for sending tips of tokens inside the server.

Issues you may run into:

• Membership tracking that’s more advanced than POAP: You could need to issue a fresh set of NFTs, or some kind of unique members-only token, to effectively gate your servers and give permissions.
• Being too open or too closed with your information sharing: It can be hard to strike a balance between how much information should be internet-public, and how much should be gated. This is especially tough when onboarding new members, or when members choose to leave the DAO and need to be offboarded.

Broadcasting

Reaching your audience so you can sell your product or service, onboard new members, and share your mission with the world is another key piece of DAO tooling. This section will feel reminiscent of web2, since many of the same platforms still apply.

Platforms:

• Social media that reaches your ideal audience: This includes platforms like Twitter, Instagram, Facebook, Reddit, and LinkedIn. Or, for a web3 alternative, Lens is a new web3 native social media site. Find your audience where they are, and reach them!
• Website: Your DAO will likely need a website to reach your ideal audience, such as Wordpress, Squarespace, or Ghost.
• Writing platform: How will you get your DAO’s ideas out into the world? Substack, Medium, Mirror, Ghost, and Paragraph are popular platforms.
• Social media management tool: If you’re using social media to reach your members and audience, consider something like Agorapulse, Hootsuite, or Later. These platforms are great for scheduling and reviewing content prior to posting.

Issues you may run into:

• Permission management: Who has access to high-broadcast channels, such as the DAO’s Twitter account and Substack? Who has to review posts before they’re published? Permission management is a constant tug-of-war in DAOs.
• Creating, maintaining, and updating a website and writing platform: It’s best to have a content strategy for your website and writing platform, but that can be hard in a decentralized environment. Having a guild dedicated to maintaining written materials can be a good solution.

Legal

If you’d like to hire employees, enter legal agreements with other entities, and offer contributor protection from liability, you’ll want to add legal tooling to your DAO tool stack. Read our guide on Legal Wrappers for more information, or contact a DAO expert.

Platforms:

• Legal entity creation as-a-service: If you’d rather have an expert help you along the way, consider hiring a group that specializes in creating legal entities for DAOs. DAO Experts Otoco and Twali can assist with this.

Issues you may run into:

• Finding the right fit: Finding a legal entity that fits your needs without causing too much regulatory headache can be challenging.
• New tax obligations you may not have been aware of: When taking your DAO “on the books,” you’ll need to pay taxes, which may be challenging if your DAO isn’t profitable or if you don’t have an accountant who understands crypto.

Test and iterate as you go

It’s best to stay flexible and continue testing your tools as you go. Your DAO tooling stack will likely change many times over the course of your DAO’s life, so don’t feel that the solution you choose needs to be the default solution forever. Iteration and experimentation is key to DAO growth!