We often get asked by web3 builders, “When is the right time to launch a token?” We have a very easy answer – early and often.
You want to be frequently distributing cultural ephemera that propagates your brand, encourages collective experiences, and builds your collector base.
You should be onchain from day 0.
But, of course, that’s not actually what builders are asking. They’re wondering when is the right time to launch the token, the one that distributes network ownership and introduces governance. This is a much bigger deal, and there’s endless nuance to that answer.
Here’s how we think about it.
If the token is absolutely core to the functionality of your network it should be launched immediately. There’s no Ethereum without ETH.
But most DAOs and consumer crypto products don’t look anything like L1s.
If you have an idea and are thinking about starting with launching a governance token, you probably shouldn’t.
If you’re struggling to build a community and are wondering if a governance token would help, it probably won’t.
If you’re overwhelmed by the demand your project is seeing and want to launch a token to scale attention and capabilities, giddy up let’s go.
Building something a large number of people want to be a part of is rarely done by committee, and maintaining the freedom to be opinionated and make quick decisions within a core team is essential.
So don’t worry about distributing governance until you’ve actually built something many people want to be a part of.
But this doesn’t mean that ownership shouldn’t be core to your product. You can often obtain many of the incentive advantages of distributed ownership in the initial stages through compelling narratives and thoughtfully crafted experiences.
People want ownership experiences more than they want ownership responsibilities.
Once you’ve found product market fit, understand how you’ll accrue value, are able to clearly describe the dynamics of your network, and are ready to pour gasoline on the fire – then it may be time to become user-owned.
And when you do, it’s important to go big. Governance tokens are meme tokens. They represent the shared belief in a world view. Memes need attention. You should have the pieces in place to attract a ton of attention, store it in the network, and put it to productive use.
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