On Wednesday morning, Friends With Benefits (FWB) DAO approved a system’s upgrade proposal seeking to establish a software company. The ratified proposal is the first of a two-step process to upgrade FWB’s organizational and legal structures.
According to the proposal, authored by Jose Mejia, Mike Bodge, Hirad Sab, and Dexter Tortoriello, the DAO currently exists as a single entity housing various segments. But despite the “symbiotic” relationship between various aspects such as product, membership, and partnership, “some of them require different organizational structures, levels of centralization, governing frameworks, and operational strategies to thrive.” Moving forward, FWB will be restructured into two entities.
Once implemented, the DAO will be made up of a Software C-Corp and an Unincorporated Nonprofit Association (UNA). While the Software Corp will explore new use cases for the FWB token, the UNA is meant to oversee the general FWB ecosystem.
The authors believe the restructuring will help the DAO to “raise capital from outside investors” while lowering FWB’s treasury burn by 41% per month, extending the DAO’s runway from 12.7 to 20.7 months. It will also allow the group to focus on further decentralization.
We see establishing a Software C-Corp as a necessary next step for properly resourcing FWB’s software initiatives.
As for its decision to launch an Unincorporated Nonprofit Association, the proposal argued that it was “the most legally sound wrapper for the DAO’s range of community-focused activities.”
Founded in 2020 by Trevor McFedries, FWB DAO kicked off as an online club for creatives but has since evolved into a full-blown Web3 collective.