Idea milestone incentives

Incentive approach for executing ideas using budgeted milestones

Overview

Idea milestone incentives mean that a proposal would detail out the different tasks and steps involved in executing an idea across different milestones. Each of those milestones would have to specify the amount of compensation that is required to execute each one. An amount of time could be specified against each of the execution tasks to achieve this total required compensation. Funds are released as each milestone gets executed and evidence is provided to prove that a milestone is complete. The milestones are strict in terms of the expected execution output that must occur for the current milestone to be fully compensated. Any changes to the milestones would need to go through some form of approval process.

High budgeting complexity (Score - 2)

• Budget planning complexity - Proposals would need to break down the idea into milestones with the tasks that will be executed in each one. The amount of compensation required for that milestone then needs to be attached. The time taken for each of those tasks could also optionally be included to demonstrate the exact calculations. This creates a high amount of complexity for the proposer as they need to be accurate on the exact time that will be spent on each milestone. This can be difficult to achieve as there are often many changing surrounding factors that can influence the time it takes to execute an idea as well as changes in the scope of the idea as more is learnt over time. Contributors will need to respond to this changing information and environment as it occurs.

• Execution scope risks - The larger the scope of the idea the more risk there is that the execution efforts could take longer or shorter than expected due to a range of emerging and changing factors during execution. This could result in contributors being under or over compensated for different pieces of work due to the requirement of using milestone based budgets. Differences in actual compensation with the expected compensation could easily increase tension between contributors when they are underpaid for their efforts. Alternatively there is also a risk that contributors could try to exploit the process and repeatedly get overcompensated. Changes of scope that result in different budgeting outcomes is a high risk for proposers. Smaller scoped proposals also do not remove the budgeting complexity as now proposers need to repeatedly make many smaller proposals with accurate budget planning which still adds large amounts of administrative overhead as well uncertainty in being selected and funded for each of those ideas.

High voter decision complexity (Score - 2)

• Ease of understanding - Voters need to roughly understand the feasibility of the budget that has been allocated to each of the suggested milestones to determine if the compensation is fair and reasonable. Voters would be able to see how much time and effort is going to be spent on each milestone. Voters would either accept or decline that suggestion based on their own expertise and understanding. There is a high complexity for voters due to the fact they need to have enough understanding of the idea and required skills to effectively judge what is fair and reasonable. When the incentive is more closely attached to the tasks itself the voter needs to have the right background and expertise to truly understand the skills and time it might take to execute certain areas of work. This is in contrast to time incentives where the voter only needs to understand what the market rates are for different roles and the experience level of the contributors involved in the idea.

• Ease of comparison - Each idea would have completely different milestones and scoping of those milestones. This factor makes it harder to standardise the milestone structure and content which then makes it harder for voters to make easy comparisons between the different proposals that are requesting compensation. In comparison, it is far easier for voters to compare time based incentives as the voter is able to look at the requested salary against existing market data to be sufficiently informed on whether that request is fair and reasonable.

Moderate governance complexity (Score - 3)

• Incentive distribution risks - The proposal budget could be handled by an individual or a group of people using a multi-sig. If it is managed by one person they have influence over how and when this incentive is distributed which could cause tensions if they misuse or restrict how this incentive is distributed. Similarly a multi-sig also introduces issues where conflicts could occur during execution that slow down or prevent funds from being distributed.

• Size of compensation risk - Idea funded proposals could request funding beyond what is needed for compensating the initial contributors involved. For instance funding could be requested to help fund future contributors. The risk of misusing these funds increases with the amount of funds that can be requested. The larger the available incentive is the higher the likelihood that people could be willing to try and abuse the funding process for self gain. Sufficient checks and balances will be needed to ensure transparent or verifiable usage of funds.

• Community moderation complexity - Community governance would help with identifying which ideas are not being executed well so that more competent contributors can be selected in future decisions. If there are only idea milestone submissions as contribution logs there is a higher governance complexity for the community as it could become more difficult to determine if there are highly performant contributors in that group of people executing the idea as they won’t have the individual contribution logs to compare with other people who were compensated. The community would require more accurate contribution information using individual time based logs rather than a milestone task approach if they wanted to more easily understand and compare the performance of contributors across the ecosystem.

High game theory risks (Score - 2)

• Proposal submissions - There is an incentive for contributors to submit multiple ideas to increase their chance of receiving compensation. Ideas can come in many sizes so a funding process restricting contributors to only one idea submission could be limiting. In contrast if the process accepts multiple ideas from the same contributors this means that there is a higher complexity for voters to compare and select from these.

• Proposal details - There is an incentive to exaggerate the amount of work it will take to complete a milestone so that the contributors can receive more compensation than the work to be completed. This can increase the verification complexity as the moderators need the right skills and context to be able to properly understand whether a milestones budget is fair and reasonable. If milestones are based on grouped tasks this gives the contributors more ability to manipulate this number and for it to be hard to spot due to the fact that milestones will often be unique which makes them difficult to compare with other milestones in the ecosystem.

• Execution verification - Proposers would be required to submit evidence to prove they have completed a given milestone. The main way that the contributors could try to exploit this process for their benefit is by claiming they did the work of someone else in a milestone and using that as evidence.

• Malicious voters - Malicious groups of voters that are trying to benefit themselves would have a larger incentive and ability to get access to more funding compared to just contributor incentives. This is because the cost of an idea could be budgeted to exceed the costs of the contributors salaries that are suggesting the proposal.

• Voting outcomes - Voters have the personal incentive of voting on things that will benefit them. The risk of this occurring at a wider scale is that novel research and innovation that does not immediately benefit the voter does not get actively supported. This could just be because the potential impact of this work is not easily understood due to its complexity or novelty. It could be difficult to get the community to widely agree on every idea that should be supported that could have the potential to generate large amounts of impact.

Very low contribution flexibility (Score - 1)

• Changing an existing idea - A contributor would only partially be able to change how they execute an idea as the outcomes would still need to still match the milestones that have been budgeted and set. If the contributor wanted to change the milestones they would need to seek approval from the community to make changes to those existing milestones. If contributors were able to change these milestones without any form of approval then it would remove the reason for using milestones incentives in the first place as instead they could have simply just adopted time based incentives so that the contributors could change their execution approach at any point. This approach is not inherently very flexible for enabling contributors to change how they execute their already funded idea.

• Contributing to a different idea - For other funded ideas a contributor would need to come to some form of agreement with those other contributors about how they will be compensated and how they could contribute under their available budget. This approach is not very flexible for enabling contributors to work on different ideas.

• Contributing to a different priority - The contributor would need to get funding for an idea that addresses the other priority or come to some form of agreement with another team who already has funding for an idea that is addressing the different priority. This approach is not very flexible for enabling contributors to work on different priorities.

• Incentive complexities - A contributor looking to contribute towards a different idea would need to determine how much compensation is needed for them to contribute to those initiatives and then also come to some form of agreement with the other contributors who were funded for that initiative. This is more complex to handle as the milestone budgets would have already been set which increases the chance that they need to be adjusted due to contributors moving around their contribution efforts. It could also be difficult to budget for the future work correctly due to many changing factors that could influence how long they actually spend contributing to these other ideas. Contributors would also face incentive complexity when they want to change any existing milestones and budgets that they have already planned for their own ideas. Incentive complexities would likely occur for any type of contribution change.

• Moderation complexity - Some form of approval process is likely needed when milestones need to be changed for an already funded idea.

Low income stability (Score - 2)

• Likelihood of future income - Being selected for one idea will not result in any high certainty that the contributor will have their future ideas get selected. The contributor will need to identify the most promising ideas that might get selected and then request to join those proposals if they want to increase the chances that they receive future compensation.

• Compensation accuracy - Predicting the time it takes for every execution milestone is challenging. Ideas that need to be executed may change due to factors outside of the contributors control during execution. Changes in the idea being executed and surrounding factors and environments can lead to situations where the contributor is under or over compensated for their contribution efforts.

Total score = 12 / 30