GIP-81: Should GnosisDAO fund CirclesUBI Indonesia's product testing launch?

Governance GIPs
1

GIP-81: Should GnosisDAO Fund CirclesUBI Indonesia’s Product Testing Launch?

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GIP: 81
title: CirclesUBI.Id - Should GnosisDAO Fund CirclesUBI Indonesia's Product Testing Launch?
author: Shaunda Brown, CirclesUBI.id
status: Draft
type: Funding
created: 2023-03-16
duration: 2023-2024
funding: €1.693 million

Simple Summary

This proposal would fund CirclesUBI Indonesia’s 2023 & 2024 operational costs associated with the launch of product testing in Bali, Indonesia. The CirclesUBI Indonesia (branded as our landing page CirclesUBI.id) team has partnered with the former Circles Land team, which became part of the German Gnosis team in January 2023 to ensure a solid technical foundation for the Circles platform and a timely release of the CirclesUBI.id product. We will continue the research launch of CirclesUBI.id in 2024 congruent with our legal licensing application, and pending approval, scale in Indonesia.

Circles is an application on Gnosis Chain that tries to implement a fair global currency based on the principle of UBI - money issuance is done as UBI (universal basic income). In 2019, we met with Martin Köppelmann to learn about Circles and the flagship pilot of Circles Garden in Berlin. We wanted to develop a separate Circles program that would work in other places in the world, so spent the past 2 years conducting intensive user research, obtaining testing licenses, developing key educational collateral, building a team of roll-out specialists and creating a geographically customized implementation strategy for the Indonesian market that has been privately funded by Martin Köppelmann & Friederike Ernst. Now that we have developed a Circles program we are confident will significantly help meet daily needs in Indonesia, have the necessary legal approval for product testing research, and the most capable and dedicated team to bring Circles to Indonesia, we are proposing funding by the GnosisDAO.

The following CirclesUBI.id proposal would help foster the mass adoption of key Gnosis technologies in the 4th most populous country in the world. Circles already has several hundred thousand profiles on Gnosis Chain and, as part of a decentralized identity stack, could be one of the growth drivers for Gnosis Chain. The Circles Indonesia project is aiming to be a test balloon for Circles global rollout. Our 2023 research program has 1500 people, half of whom are merchants, across three distinct rural/ suburban/ urban settings across Bali. This is a meaningful and sustainable data point, since only vendors are allowed to invite others. It will help us investigate:

  • the optimal values of tunable parameters within Circles
  • the way Circles is seen in relation to government-issued monies by the users
  • how Circles is framed and explained to regular people using the technology. Circles shifts the paradigm of what money is, how it should be issued, and how it should move, so seeing firsthand how the inherent mental leaps can be facilitated for non-crypto natives is paramount.
  • the rollout should also battle-harden the technological components (mobile app, smart contracts, pathfinder, and other backend services).

Abstract

The Circles Movement vision is to empower all people everywhere to realize joyful, fulfilled & meaningful lives in which daily needs are met as communities help each other to grow. The Circles technology is hosted on the Gnosis Chain and aims to provide digital UBI points that circulate through mutual trust. See the CirclesUBI white paper here. This community-driven solution aims to support increased use of locally made products and services, as a means to strengthen localized, circular economies. As a complementary cashless solution, Circles can advance humanity one giant step into an era of mutual support, sustainable growth and abundance. The adoption of Circles across the world would also mean mass adoption of the use of Gnosis Chain.

This proposal seeks funding for CirclesUBI.id’s 2023 & 2024 operations, product testing launch, legal licensing process, and structure of the “Start a Circles Program” for worldwide expansion as detailed in our DAO Proposal Deck. We have included a detailed budget on how the team plans to allocate the €1.693 million of requested funds on page 15. We request to be paid in USDT, however in the event that it loses its peg against the USD by more than 1% we request to choose a different cryptocurrency for payout. This funding will be used to launch and scale testing of the Circles program in Bali, which we intend to expand and replicate in other areas of Indonesia. The Circles Bali project could therefore be a catalyst to wider implementation of the Circles program throughout Indonesia, tapping into a market potential of 275 million people who could help drive adoption of Gnosis Chain for the benefit of the Gnosis community & ecosystem. Through funding this proposal, GnosisDAO would establish clear alignment with its core values of funding public goods and support the development and improvement of infrastructure critical to ensuring the sustainable scalability of the GnosisDAO and Gnosis Chain ecosystem.

Milestones & Payout:

Q1 January 2023 outstanding: Preparation of product testing launch
Q2 April 2023: Website launch & training program for outreach teams activated
Q3 July 2023: Local leadership endorsement for Circles implementation across 17 villages
Q4 Sept 2023: Onboarding of 1500 users of which at least 50% are vendors

Q1 Jan 2024: Project insights available online through integrated reporting tool
Q2 April 2024: Comprehensive report of findings & analysis
Q3 July 2024: Product revisions underway & legal roadmap established
Q4 Sept 2024: Implementation plan for 2024-2025 developed & in progress

Motivation

The CirclesUBI.id program has been developed using data from our intensive field research, with an implementation strategy that works for the unique Indonesian market. Based on the initial study released in 2021 on “Universal Basic Income for Bali: Research Report for Circles Implementation,” our team aimed to understand the viability of such an implementation, discover pain points and possible solutions, and determine potential implementation strategies. We found that Circles technology could have a significant impact on Balinese users to improve wealth equality, help meet basic needs, and expand business opportunities.

As you can see from the subsequent Circles Community Research Report, we gathered quantitative and qualitative research data to identify local needs, map examples of local supply chains and receive candid user feedback and local leadership on the viability of the Program. The results showed resounding support of Circles in Bali with 97-99% of respondents across villages in rural & urban areas of Bali enthusiastic to start using Circles. Villages in the tourism-based economy had lower approval ratings of 65% due to lack of use of locally-based goods & services, so we’ve focused implementation in rural & urban areas. +70 representatives from local governments and leaders signed an endorsement letter in support of Circles in Bali. This shows the high probability of successful adoption of the strategy, methodology and tools we have developed, not only in Bali but for all Indonesia.

The 2023 phase of our implementation plan is to test the CirclesUBI.id product viability with the aim to receive official legal licensing to expand across all of Indonesia. The CirclesUBI.id team has been working closely with the amazing team formerly known as Circles Land, which became part of the German Gnosis team. Together we have adapted the technology to better meet the unique needs of the Indonesian market. With the teams close to producing a stable product to begin our product testing launch, we are excited to release the program to an initial 1,500 participants. A minimum of half of these initial participants will be merchants across three distinct rural/ suburban/ urban settings across Bali. Onboarding users is easy if the product is ‘free money’ – getting people to sell goods in exchange for it isn’t. We have a detailed strategy from our research to ensure we create the most sustainable and balanced ecosystem. We also have thorough data insights reports to measure impact and track invite growth, such as incentives allowing only vendors the ability to invite other users & vendors to CirclesUBI.id. If the product test is successful, this will provide us with the information needed for public relations & media launch, legal licensing, and scale strategy to the potential market of 275 million people currently living in Indonesia, as well as provide a blueprint for independent rollouts elsewhere.

To continue the detailed implementation research phase in 2024, the main aim is to gain the necessary legal licensing in Indonesia to expand beyond 2023’s legally required “research phase” and scale across all of Indonesia. As you can see in the deck, we currently have legal permits from the Indonesian government that can be extended for up to 3 years (pending approval). This allows us to have a scaled entry point in Bali for our intensive MEL (Monitoring, Evaluation & Learning). See the password protected portion of our site for the MEL tools and format. With our MEL results, we will have the qualitative and quantitative data to show the 3 main regulatory agency bodies in Indonesia how Circles supports their governmental goals, how much the people benefit from use of Circles, and therefore why we should receive legal licensing to operate across the country. We will gather data after 6 months of testing in the field, and then create reports to begin the Indonesian legal licensing application process. If we are successful, then we are hopeful we can continue the research phase through a seamless public launch across Indonesia under a Government approved and licensed regime, which will offer greater credibility to our product and allow us to scale in a more meaningful way.

Rationale

For a more detailed specification of why CirclesUBI.id is based on such rigorous research to structure the implementation plan and product needs, please see our DAO Proposal Deck.

To better understand the unique community needs of the Indonesian market and see how Circles can be used in Balinese villages in which we are conducting research, please view our 10 minute video Voices of Bali’s Communities on our home page.

To understand our outreach approach to users and vendors, and the “How To Start a Circles Program” with all materials downloadable in both Indonesian and English, please first login at circlesubi.id and enter the password “circles2023.” You’ll then be able to use the robust password-protected section of our website. This is the section for Facilitator/User/Vendor Resources, FAQs, and Impact Monitoring Tools. The public-facing section of the website has information for local licensing agencies about CirclesUBI ID, with stories, FAQs, and key benefits of using the app. We separate these sections out as we only publicly print materials that can be used to support the Indonesian legal licensing agency objectives.

Implementation

Please see the CirclesUBI.id DAO Proposal Deck for the product testing launch plan and scale strategy.

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2

Thank you for posting the proposal @Shaunda!

It is important for me to understand which payout is expected by the DAO based on which milestones to understand the costs associated with each step.

The proposal only states that there is one amount requested for the period of 2 years.

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Thanks @StefanGeorge! Great question.

To clarify the payout schedule, the section listing the “Milestones & Payout” are the goals CirclesUBI.id will achieve at the beginning of the quarter in which the payout will be received. It will be an equal distribution each of the 8 quarters in the 2 year period of the €1.693 million of requested funds. Therefore, each quarter will be a payout of €211,625 according to these dates and milestones. I’ve pasted below the section from the proposal with the milestones & payout, please let me know if that answers your question.

Milestones & Payout:

Q1 January 2023 outstanding: Preparation of product testing launch
Q2 April 2023: Website launch & training program for outreach teams activated
Q3 July 2023: Local leadership endorsement for Circles implementation across 17 villages
Q4 Sept 2023: Onboarding of 1500 users of which at least 50% are vendors

Q1 Jan 2024: Project insights available online through integrated reporting tool
Q2 April 2024: Comprehensive report of findings & analysis
Q3 July 2024: Product revisions underway & legal roadmap established
Q4 Sept 2024: Implementation plan for 2024-2025 developed & in progress

4

Thank you @Shaunda. I am curious to understand why you expect linear costs. I would expect that costs at the beginning are lower and grow as the project grows in the number of users and support needed to grow the network further.

From my perspective investing 850k EUR to onboard 1500 users in Bali seems like a big investment with too little return. What I would like to see is low burn until we can see signs of product market fit and then invest large to grow quickly.

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5

Thanks @StefanGeorge. Pardon my silence. It was Nyepi in Bali, also known as the “Day of Silence” or the Balinese New Year. The entire island shuts down with no technology or lights, and everyone is required to stay inside while the evil spirits fly over after the ogoh-ogoh celebration to scare the evil spirits away. Even the airports shut down so the spirits think that Bali is uninhabited. Just an insight into daily life in Bali!

I understand your viewpoint on the funds required escalating over time. Over the past 2 years of operating we’ve applied that model of non-linear capital deployment showing 97% acceptance rating of Circles use. We will continue to discern when to apply either method to our costs going forward.

In the case of the quarterly milestone equal payouts, we structured the funding in that way to provide internal and external assurance to key partners and government offices. Structuring in this way also ensures that we have sufficient runway to draw from in case we need to adapt to any change of strategy (based on our findings), unexpected external delays (such as product changes), legal implications, and/or economic and market factors.

Much of the work is required upfront to prepare the conditions to onboard the 1,500 initial research participants and have the pieces in place to accelerate the onboarding at scale. The key word here is “initial research participants”, which is a different category than just many more “users” that will be exchanging Circles. We are onboarding 1,500 initial research participants in the high-touch, methodical process to gauge feedback and develop the required legal data to proceed with legal licensing in order to continue expansion. Each of these participants will likely be a vendor as well, which is how we structured the onboarding competition. The vendors can invite other users & vendors (we are not allowing just “users” to invite others which will support sustainability). We could have closer to the tens of thousands total active users (majority of whom will be vendors) given the market fit in this 6 month MEL research launch…and then continuation of the program after the MEL period which we expect to grow. We are being conservative in our target ensuring the initial research participants are onboarded smoothly in the pilot cohort, then we will be in the position to ramp up the scale. Our conservative estimate of the number of users within the next 3 years is 50,000 if everything goes according to plan with the legal. If we can move faster with the budget being proposed, we will.

We are using this balanced approach to fit the unique cultural and user needs of the Balinese market in which we are launching. In the Balinese market that shuts down all business for 2 days to scare away evil spirits during Nyepi, we are not able to transport a strictly startup or VC model for rapid growth of users. We have learned from strictly startup approaches and our research what is sustainable and what is not for rapid growth. Both approaches have their strengths and weaknesses. We have chosen to combine approaches to find what works best in the context of Indonesia. Our plan is to launch a sustainable model with a strategic, culturally sensitive, research-driven approach along with metrics for continued growth of a product viewed as revolutionary in this market. We are confident that this is giving Circles the greatest probability of long-term success, which results in truly helping the majority of Indonesians meet basic needs through the use of Circles. In order to do this successfully, we must follow the requirements for the unique Indonesian market such as launching a product which works and does not break, and the ability to implement in culturally sensitive ways for users to trust and accept Circles.

For more information on why we think Bali and Indonesia is the perfect market for Circles and why our research supports this combined method, please see our detailed implementation plan based on the past research for the ways we are working with partners to best ensure this long-term success.

6

Thank you for your detailed answer @Shaunda. I understand now better why a large amount is needed in your view, especially taking the legal licensing into account. In my view circles is still in an early product-market-fit stage and any efforts to costly legal licensing should be pushed back until we have more clarity about the path to success. This should reduce costs and risks associated with the project. Do you see any alternative proposal? I want to support Circles but we have to take costs into account.

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7

Thanks @StefanGeorge. I am meeting with Martin & Friederike tomorrow to discuss options and will get back with you ASAP.

8

After discussion with Gnosis DAO, CirclesUBI.id is submitting a revised proposal to fund Milestone 1 associated with the product testing and participant onboarding in Bali, Indonesia.

CirclesUBU.id will receive €500,000 once the GIP passes in order to hit Milestone 1 of 1500 participants in product testing across 17 villages.

Definition of onboarded participants:

  1. Onboarding of Field Officers/Local Champions
    a) +20 people successfully follow a training program, and pass screening to ensure they can support their communities + conduct effective troubleshooting & survey interviews during 3 months of the roll out period
    b) These 20 people ensure 1500 users are successfully onboarded

  2. Onboarding of Testing Participants (users)
    a) 1500 participants have successfully attended the user onboarding workshop and understand how to use their Circles account, have created their circles user account + a shop account that is visible on the circles marketplace

  3. Active participants (retention rate)
    a) # of users that conduct at least 1 translation per week and participate in feedback interviews about the product performance and benefits

  4. Inactive participants
    a) Are not actively using the app at least 1 x per week, and participate in feedback interviews aimed to determine what the reasons are that they are not using the app

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Thank you for the revised proposal. What is the number of active participants that should be reached with milestone 1?

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We are using this initial product testing to understand what the retention rates will be, and are aiming for 70% active participants.

I think a more important consideration is that we are aiming to have participants also be vendors. We hope that 70% of active participants will also be both selling & receiving Circles on a weekly basis.

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