How Do DAOs Operate When No One Is in Charge?

Ryan Boder, core team lead at API3, told Blockpit, “Because you don’t have that strong personality at the top who’s just telling everybody what to think and what to do, it’s more of a ‘how can I contribute’ mindset?”

However, setting up the decentralized structure of a DAO doesn’t happen overnight.

DAOs typically start as a core team that establishes the project or protocol through smart contracts — all of which are fully transparent. Once a project is off the ground and gains some momentum, the core team can consider decentralizing certain parts of the organization.

At API3, for example, there are four or five core teams that represent functional areas of a company, such as the core tech team, the missions team and the marketing team. Ryan explains, “The teams themselves operate like individual, smaller companies or individual entities, which is good, because being decentralized to the extreme is actually quite inefficient.”

This way, smaller teams are working in a more focused capacity, and the larger DAO can propose and vote on specific ideas.

Still, a decentralized organization creates the structures for new ideas and collaborations to emerge. “Being decentralized means that you have different opinions and people are self-organizing and self-motivated,” he explains. “We definitely work to align on the same larger vision and goals and even on tactical stuff, but at the same time, there’s more diversity than I think you experience in a company.”