Are we witnessing another example of poor business practice with the announcement yesterday (11/01/22) of Stake Pool Offering changes by the NMKR team?
Overnight (10/01/2023), without warning, and just prior to an epoch snapshot, NMKR SP changed their variable pool fee percentage from 10% to 99%.(NMKR NMKR - Cardanoscan) This pool was started in February 2022 to distribute 480,000,000 $NMKR tokens (4.8% of total supply) over the next 4 years. The reasons stated for this abrupt change were to create more excitement in the community. Over the last 12 months, the SP has struggled with attracting delegation, averaging at around 4M ADA delegated, with a reward rate of 2%. The main hurdle I could see was that the community believed that NMKR company was earning enough through its service revenue and regular Catalyst Fund grants and both private and public sales (60% of 10B total supply).
As a user, investor, delegator, and community member of NMKR, I was shocked at this announcement. Not because of loss of rewards, but because of the obvious need for funds. Not only that, but people have recently invested a significant amount of ADA into their new open world game.
In light of this, and the collapse late last year of Ardana and Orbis, as well as a few other projects earlier in the year, I believe we need to develop, at least, a business mentorship program for projects building in the blockchain space. We have a lot of young, very talented developers, with brilliant ideas that they know, or can figure out how to build with enough time, but this doesn’t mean they are financially/business literate.
Take World Mobile and its founder Micky Watkins for example, he has had years of experience in his industry, is a serial entrepreneur, has held multiple company directors’ roles, and truly knows how to bring people together to build whatever vision is in the pipeline. World Mobile is his baby, Micky has a clear plan and massive goals to achieve. World Mobile gave its investor, both private and public, a clear outline of what they plan to do. As milestones become closer, the details are clarified then completed. World Mobile, as far as I’m aware, has never once promised to do something, then changed their mind at a future date due to unforeseen obstacles. This is what business leadership looks like, and Micky has gained this through a lifetime of effort.
Now let’s look at Patrick Tobler, founder of NMKR, he is straight out of university, has done some freelance work, made a company structure for himself and NMKR is one of its projects with 25 or so team members. Recently was voted a Catalyst Circle Representative. Now, before you get upset, Patrick is a lovely guy, passionate about what he is doing, talented to the extreme. I have nothing but respect for him. But perhaps, as many young people do, he’s bitten off more than he should.
This is where Mentorship comes in. A business mentor is someone that you can bounce your ideas off, they support you and provide advice when needed, they should also be telling you straight when you’re trying to do too much yourself and how to delegate responsibility. A mentor is not a peer, not a co-worker, they exist outside of your comfort zone.
I believe business mentorship may be one of the “structures” Charles was alluding to in his ScotFest presentation on the Voltaire era of Cardano. We, as community members, need to have more assurances that the projects we support financially will succeed. Whether that support is coming from ISPOs, IDOs, TGEs or Catalyst Funding, I would like to know that our young/inexperienced entrepreneurs and developers have the means, through experienced people, to succeed with their ideas.
I hope people reading this will add their thoughts to this discussion in a thoughtful manner.
Thank you for reading.