TL;DR
To remain in-line with the wishes of the DAO:
- We have reduced our responsibilities from our previous 2025 re-election draft.
- We have lowered the associated budget.
- We will be paid out through a vesting schedule.
Intro
AlphaGrowth proposes a 12-month renewal of the Compound Growth Program. As we approach the conclusion of the 2024 Growth Program term, we aim to build on the program’s momentum—amplifying what’s worked, refining our approach, and unlocking new opportunities for Compound’s long-term growth.
The Community has provided generous feedback over the past four months, and AlphaGrowth has concluded that we have proposed taking on too much responsibility for the coming year. Our strategies and responsibilities have been reduced to remain in-line with those of the community, thus lowering the cost of the Growth Program. Which will be paid out through a vesting schedule that increases AlphaGrowth’s accountability to the community.
We have integrated the advice of the community, and delegates, and have structured the scope of our 2025 Growth Program to be a continuation of service, with a moderate expansion of Growth initiatives.
Beyond our already stated mandates, our KPIs will be higher than those we exceeded in the 2024 Campaign. And we will experiment with additional growth channels while maintaining our current responsibilities.
Growth Program Victories
AlphaGrowth’s posture of leadership has been a source of strength. Our growth mandate gave direction to Compound, when Compound Labs gave the community an opportunity to step up.
AlphaGrowth has done well in serving this role:
1. Navigating the Humpy Negotiation:
This podcast from a16z Crypto breaks down the aftermath of the Golden Boys proposal. In short, Humpy took action to make sure that the Compound treasury would be productively spent, and he agreed to withdraw his proposal, in exchange for Staked COMP.
Bryan Colligan deescalated the conflict, changed the community sentiment from Conflicting to Cooperative with the new situation, and prevented a radical restructuring of the COMP token – allowing the protocol to resume and flourish over the last 9 months.
2. Protocol Expansion - 4 Chains, 11 New Markets, 84 collaterals
AlphaGrowth has assumed primary responsibility for expanding the protocol for all new opportunities and narratives, post the departure of Compound Labs,
We have launched Compound V3 on 4 Chains - Optimism, Mantle, Linea, Unichain. And we are preparing to launch Compound on two more Chains - Ronin and Sonic.
We have launched 11 new markets in total - The most prominent among them were the USDT markets on Mainnet with almost $300M in TVL. Top performers also included ETH, USDT and USDC markets on prominent chains like Arbitrum, Optimism and Base.
We launched 84 Collaterals in total - The AlphaGrowth team understands the pulse of the market and capitalizes on emerging narratives like LRTs, Yield bearing Stablecoins, wrapped Bitcoin alternatives and more.
3. Outperforming Competitors in the Arbitrum LTIPP Program:
AlphaGrowth’s approach toward incentive distribution has opened doors toward grant opportunities in other ecosystems. We shared our experience and methods with Compound DAO, and additional members can now integrate our learnings into their strategies to Compound grow.
We invented a new methodology for incentive distribution for Compound, and distributed 1.8M ARB in incentives for Arbitrum and followed up with another $245k for Optimism. On Arbitrum these campaigns grew TVL from $92M to $266M over 4 months, a gain of $139 per $1 of ARB incentives spent.
Here’s Open Block Lab’s independent analysis, showcasing how Compound Growth Program strategies performed 7.7x better than a top lending competitor’s LTIPP grant distributions during the same period.
4. Ongoing Incentives From Chains
AlphaGrowth has set a precedent within the Compound community on how to expand partnerships with current chains and their ecosystem partners. The team has strong experience in relationship cultivation with Chains, which has benefitted Compound to a great extent. Within the past 1 year, we have secured ~$4M of token commitments from existing chain deployments, through direct lobbying, standard procedures, in-person meetings and more.
5. Multichain Expansion – The 10 & 1 Deal:
AlphaGrowth designed a standard offer for maintaining profitability when deploying to New Chains. We then sold that offering to multiple ecosystems.
The 10 & 1 Deal means:
- $10M in Supply Side Liquidity
- $1M in Incentives
These resources are sourced from prospective ecosystem partners, or liquidity deals are formed to ensure that markets can be grown toward 90% utilization.
AlphaGrowth has brought over $750M in TVL through these expansion efforts, and those deposits will provide the protocol with revenue for years to come.
6. Framing cUSDC as a Saveable | Spendable Asset:
AlphaGrowth is recontextualizing how DeFi users interact with cTokens.
Our Linea Deployment includes a partnership with Mastercard, which will allow people to spend cUSDC, effectively creating an interest-bearing checking account.
Our Ronin Deployment includes partnerships with Circle, Ronin, and Game Developers. They will build gamified savings accounts, and educational frameworks for leverage trading and hedging.
Our BOBBY Vault is an innovative speculative time premium game, which is designed to incentivize purchases and deepen supply-side deposits for stables on Arbitrum.
Our goal is to bring Compound to the center stage of Defi & AI adoption.
7. The ICE Framework:
The Compound Brand is in demand, and during our time in growth, we have qualified and prioritized 126 new opportunities and strategies, of which more than 75% remain in the pipeline constrained only by time and resources. Many are at the finish line, or waiting on our continued effort to execute. This is our main reason to expand the Growth team’s operations.
Each opportunity was given a score out of 10, in the areas of:
- Impact (What’s the initiative’s potential to drive TVL & Revenue to the DAO?)
- Confidence (What’s the probability that our Impact & Ease scores are correct?)
- Ease (How much time and resources are needed to deliver a final product?)
This framework has been crucial to our efforts, and this abundance of opportunities indicates the amount of work set before Compound in terms of its potential for growth.
8. Novel Marketing and Community Engagement Strategies:
At AlphaGrowth, we embrace experimentation and critical feedback.
There are no effective guidelines or rulebooks for how to communicate on behalf of a Lending Protocol, and if there were, those comms would probably be boring.
Here are a few approaches we have explored:
- Spaces AMAs - Like this one with Chainlink about SVR.
- Facilitating weekly Community & Developer Calls.
- Deep Dive Threads and Forum Interviews which seek to understand partners and announce campaigns.
- Forum Articles, which push policy discussion about Collateral Factors, Increasing Utility for COMP, and Cross-Chain Arbitrage strategies to balance utilization across Compound Markets.
- Building out custom Structured Product Strategies, and sharing them with the Community.
- Podcast style interviews at Messari Mainnet.
- 1 on 1 meetings with our partners at Permissionless, ETHDenver, and Hong Kong.
- We have explored visual media to accompany campaigns, causing views to reach up to 4.4M views on a single post.
- Video Interviews with respected KOLs.
- Public Speaking onstage at DeFi BaseCamp and Chainlink Lightning House at ETHDenver.
- By also focusing on distribution on 𝕏, we generated 50M new views using the campaign content described above.
Our goal is to be generous with our attention, and observe which partners demonstrate the greatest desire for engagement. We do this work on behalf of Compound, so that we can pursue the areas of growth that have the most momentum and collaboration.
Compound Growth Program ROI
Over the last year of operation, the Growth program has brought $8.91M in the form of reserve growth and incentives to the Compound DAO and its users (2.22x the program’s $4M budget). These revenue inflows more than pay for the growth program and make it a sustainable net positive cash flow for the community.
Revenue earned from Market Growth - $3,014,885
Two of our major initiatives this past year were (1) the addition of the USDT and ETH Markets on multiple chains where Compound V3 is deployed and (2) the addition of collateral assets based on Market narratives (LRTs and yield bearing stablecoins). These strategies have cumulatively resulted in $750M of TVL growth, earning the protocol reserves an additional revenue of $3.015M over the past Year.
This current TVL added by AlphaGrowth initiatives has the potential to earn between 5M$-7M$ for the DAO over the next year and every subsequent year the protocol remains active and the TVL is retained. This will have a substantial impact on offsetting the cost of 2025’s growth program before factoring in AlphaGrowth’s expected impact in 2025 to increase these revenue streams.
Tokens secured through Standardised Chain Deals - $2M
As mentioned in the previous sections, the AlphaGrowth team standardized the Chain deployment process for Compound V3. Based on our current chain pipeline, we only prioritize deploying Compound on chains if we model that agreeing to our 10 & 1 deal will get the Compound markets to $50M in utilization on that chain, or if we believe there’s an opportunity for the DAO to make revenue equal or greater than that brought by $50M of utilization even without a 10 & 1 deal in place.
Over the past few months we have secured commitments from 2 chains for the 10 & 1 deal - Mantle and Ronin - Giving Compound $20M in Liquidity loans and $2M in incentive tokens to distribute to Compound users.
Tokens secured through Chain Partnerships - ~ $3.9M
With Chains that Compound is already deployed on, like Arbitrum and Optimism, we have secured additional incentives with cumulative value over $3.9M. Here is the breakdown
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Arbitrum LTIPP Grants - 1.8M ARB (~$2.7M on April 2024)
- As part of the Arbitrum Long term incentives pilot program, the AlphaGrowth team managed to secure a funding of $2.7M to grow Compound comets on Arbitrum. Here is the Forum post for securing the Grant and here is the forum post on how we used the incentives.
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Optimism Grants - 515,000 OP Secured (~1.2M as of Dec 2024)
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150K OP Secured on May 2024
- Approximately around $400K at the time of winning. Here is the Forum Post.
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65K OP Secured on July 2024
- Approximately $104K for OP @ $1.6 in July at the time of winning the Retroactive Grant from Optimism. Here is the Forum Post.
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300K OP secured for LRT growth in December 2024
- Approximately $690K secured for OP @ $2.3 to grow LRT and LST lending on Optimism. Here is the Forum Post.
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Our Vision:
The Lending landscape is changing fast, and we need to work to keep Compound competitive as the code and technology is almost 2 years old.
To support this objective, AlphaGrowth will continue to serve Compound, and improve on our performance from 2024.
| Metric | Goal |
|---|---|
| Total Value Locked (TVL) Expansion | Add another $750M TVL to Compounds current TVL on the day this proposal’s vote passes |
| Market Development | Add an additional 8 - 15 New Markets |
| Chain Expansion | Expand to 3 - 4 New Chains |
| Run Incentive Programs on Current & New Chains | Distribute the remaining $1.76M Incentives acquired through AlphaGrowth’s 2024 growth program efforts. And distribute all grant funds acquired during the 2025-2026 growth program. |
| Strategic Partnerships | Qualitative over Quantitative |
| Infrastructure Expansions: Decentralized Frontend for Marketing Funnels | Maintain great UX through speed and uptime. Add at least 5 custom marketing funnels. |
Here are our main priorities for the coming year:
1. New Chains, and Ongoing Support:
AlphaGrowth has already received grant funds from Mantle & commitment of grants from Ronin. And Linea has agreed to direct VE DEX incentives on COMP pools. These resources have not yet been allocated to Growth Campaigns:
- Mantle - 873.63K MNT
- Ronin - Incoming $1M in Incentives, $10M in Supply, and we are in discussions with Circle and Katana DEX for matching grants.
- Linea - We have an agreement for ve-Incentives to be directed toward Compound Growth Incentives. Linea requires a $150K deposit from the Compound Growth Program to enable their offramps to make cTokens spendable through their Mastercard.
We have also received resources from Uniswap and Arbitrum which are pending distribution:
- Uniswap - We have Univ4 Grants through Bunni LP for Re-Hypothecated Supply Side deposits through LPs.
- Arbitrum - 100K ARB has been allocated in incentives to BOBBY’s supply side liquidity for stablecoins.
We are also in talks with new ecosystem partners, and have formed multiple strategies for Isolated Markets. Each of these deals include incentives, and we have working relationships with the partners involved.
AlphaGrowth is fully prepared to support Compound in 2025.
2. Structured Products
Last year we learned we need to verticalize partnerships with integrators who bring revenue into Compound.
Compound needs more structured products.
AlphaGrowth has built a yield optimizer called $BOBBY, which incentivizes stablecoin supply deposits on Arbitrum. We have secured grant funding from multiple ecosystems to expand this integration.
Such products offer high engagement events such as co-marketing with the strong brands of Arbitrum and Chainlink. As we work with chains and service providers, revenue generating campaigns for Compound DAO are becoming clearer.
AlphaGrowth has also formed meaningful partnerships with vault providers like Vaultcraft & Steer, and we maintain valuable relationships with integrators from our prior Arbitrum and Optimism Campaigns.
3. Staked COMP
AlphaGrowth will engage directly with the community, and form a consensus around the design and execution of Staked COMP.
Here is our Proposal Process.
We will follow up with a secondary budget for Staked COMP, as we are unsure what it will cost to build. We would like to be the steward to project manage it into existence.
4. Rails to TradFi
Another BD initiative we will continue to push forward is a path toward TradFi deposits. Aave has recently announced their intention to do the same and we’ll push Compound’s priorities to take a portion of the market. In this pursuit we will continue pushing:
- DeFi Insurance and DeFi Coverage against Smart Contract Risk
- Whitelisted, Fixed Interest Rate Vaults & Bonds
AlphaGrowth has outlined our plan to facilitate a new class of TradFi depositors.
Preparing the path for even 1 TradFi partnership would radically change the way that Compound operates, acquires and retains value.
5. Website, UX, Frontend Upgrade
The new Decentralized Frontend provides Compound with the following benefits:
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Rewards v2:
The ability to distribute ecosystem grants directly through the frontend will allow for more granular control in incentives distribution for growth campaigns.
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Branded Landing Pages:
Re-skinned landing pages for each campaign shows a touch of generosity in marketing campaigns for a specific Asset Strategy – especially when experimenting with Isolated Markets.
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Vault Strategies:
Structured Products communicate to our users that we are working to make Compound more accessible and profitable for more people.
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Campaign Traffic Data:
A Decentralized Frontend will offer AlphaGrowth information which will help us better Grow Compound.
- When we launch a Base Market campaign, do we get more users from Farcaster, or 𝕏?
- When we launch isolated markets within an ecosystem, which project discord has the most engaged community?
- Do Re-Skinned Landing Pages have a higher conversion rate than a standard UI?
Traffic Data on Campaigns is valuable, as each step in the funnel moves Compound closer toward Utilization and Fees.
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Censorship Resistant UI:
Crypto has a long history of node validators, and peer-to-peer methods of network participation. Our Decentralized Frontend will provide Compound Power Users with a new way to be involved in the protocol, and be rewarded.
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Regulatory Considerations:
The Decentralized Frontend is also a method of supporting the website in different regulatory environments for the Compound DAO. We will help drive community and socials and partnerships and help protect the DAO, and help aim that process to drive the DAO toward a legal entity.
AlphaGrowth has already completed the Decentralized Frontend, and a significant portion of our budget will be allocated toward growing this new platform while making the community proud.
Budget:
This year’s growth plan and budget are based on the 2024 Growth Program which passed with overwhelming support on May 18th, 2024. And takes into account the outcomes of the 2024 program which drove $8.9M in revenue to the DAO in the form of revenue and incentives.
After careful consideration and recalibration of our scope of work with the Compound, we have been advised by the community to follow the same path as the 2024 Growth program with added scopes, instead of the Sub-DAO format that we were considering.
Our Scope remains similar to the 2024 Growth program scope that can be found here
In the past 12 months we have identified the need to cover topics which were not included in the 2024 scope. The Growth Program’s renewed scope for 2025 is listed below.
Strategy & Operations
The service fee covers all costs associated with running our expansive program. This includes the following critical areas of the growth program operations:
Continuation of Previous Scopes
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Scope 1: Strategy & Data Research:
Tasked with uncovering new growth avenues, our team ensures the DAO is well-informed and ready to act on emerging opportunities.
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Scope 2: Marketing Operations:
With the continued leadership from the former head of growth of the Near Foundation, our marketing team is set to supercharge Compound’s visibility through targeted campaigns and partnerships.
Additional marketing scopes include increasing community engagement through AMAs, weekly calls, and forum content, while expanding reach via strategic partnerships, multimedia content, and speaking engagements. These efforts yielded significant impact, generating 50M views on 𝕏 and up to 4.4M views on individual posts, strengthening our position in the DeFi ecosystem.
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Scope 3: Grant Consultation:
Grant scouting, application, Lobbying, Grant KYC, Distribution planning and reporting. Example reporting.
The outcome of these efforts are stickier TVL and higher revenue on structured product campaigns. Examples of this include co-incentives, co-marketing, and new products which enable asymmetric value to flow to Compound in relation to our respective resources.
We focus on low out of pocket incentives for Compound with high co-marketability to justify grant funding from Chains, Protocols, and Assets.
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Scope 4: Structured Product partnerships :
Through distribution of the Arbitrum LTIPP grant, we found that the most impactful partnerships and incentive distributions come from Structured Products. Structured product integrations require long sales cycles and are often accompanied by awarding grants and incentives, for which a completely separate resource from Grant consultations is needed.
New Scopes
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Scope 5: Chain Launch
Made as a separate scope compared to launch operations last time. New Chain launch resources will focus on outreach to new and existing chains that are gaining traction and negotiating on the launch with the 10 & 1 Deal. Typical sales cycle for Compound deployment on new chains is currently 2 months (followed by 2 months of operations which includes contributions from service providers like AlphaGrowth, Woof!, Gauntlet, Open Zeppelin).
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Scope 6 Asset Launch
Over the Past 1 year, we have launched 11 Markets, more than 40 collaterals and 57 on chain proposals (Source here). Asset launch operations involve timely deployment of Comets and Collaterals to capitalize on the Market opportunities. For example, while the Pipeline for asset deployment included more than 10 collaterals, we identified that USDS on Base chain should be prioritized based on market conditions. Following deployment, the USDS market amassed $16M in TVL within months, becoming the second largest market on Base.
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Scope 7: Chain Success
As we have deployed Compound V3 on 4 chains (Optimism, Mantle, Unichain, Linea) and nearing deployment on the 5th Chain (Ronin). As we grow more accustomed to Chain deployments, we have encountered brand new challenges. For example, we’ve had to; incentives on Uniswap to provide Compound market growth stimuli, collaborate with the Mantle team to get more structured products for better utilization, work with the Linea team to get MasterCard integrated with Compound and so on. The unique efforts required to grow Compound on chains in parallel with standard launch campaigns require dedicated attention and scope.
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Scope 8: Miscellaneous verticals
- Scope 8a: Staked COMP
- Scope 8b: Fixed Rate efforts
- Scope 8c: Vaults
- Scope 8d: Insurance
- Scope 8e: Bonds
- Scope 8f: OEV | SVR
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Scope 9: Decentralized Frontend
We spearheaded the development of the Compound decentralized frontend with Nextosi and WOOF which can be hosted by Compound users, while maintaining upgradability. This Frontend increases the efficiency of our campaigns by providing more granular marketing funnel tools.
Payment Structure
We are Long COMP, and would like to be paid in COMP. The following table shows how this translates into this year’s payment vault. Last year COMP token price was $55 at re-election. Today the token price is $42. Therefore, the number of COMP will be greater to support the same USD value service agreement.
USD Budget
| Budget | 2024 | 2025 |
|---|---|---|
| Strategy and Operations | $2,211,000 | $3,316,500 |
| Marketing Fund | $1,017,720 | $1,017,720 |
| Integrations Fund | $1,017,720 | $1,017,720 |
| Total | $4,246,440 | $5,351,940 |
COMP Equivalent
| Budget | 2024 @$55 COMP | 2025 @$42 COMP |
|---|---|---|
| Service Fee | 40,200 | 78,964 |
| Marketing Fund | 18,504 | 24,231 |
| Integrations Fund | 18,504 | 24,231 |
| Total | 77,208 COMP | 127,426 COMP |
Payout Structure
- 33% to be paid immediately.
- 67% to be streamed linearly over the next 9 months via Sablier (Gauntlet has advised AlphaGrowth to use Sablier, rather than Aera Vaults).
- Compound DAO will have revoke rights on the payment stream.
- Our budget spans from April 15th, 2025 to April 15th 2026.
To align our incentives with the continued expansion of Compound, we will submit a request for performance based payment to the DAO, once we have exceeded our $750M TVL Goal for 2025.
- For every $100M over our +$750M Goal, we will request a commission of .5%
- In accordance with Community feedback, this proposal will include a TVL Evaluation, which has been completed by an independent third party.
Continued ROI to Compound
Quantifiable ROI for Compound:
- Every $100M that AlphaGrowth brings into Compound, which is sustained over the course of a year, the Treasury earns ~$0.5-1M/year.
- Each $1M in incentives that AlphaGrowth brings to Compound augments Compound’s current incentive burn.
- Each new market that AlphaGrowth deploys and brings to profitable utilization provides revenue to the treasury, as long as the protocol exists.
Qualifiable ROI for Compound:
- Each new asset, and integrator that AlphaGrowth builds a relationship with, increases Compound’s capacity for collaborative work into the future.
- Each new strategy that AlphaGrowth designs, and executes, becomes a playbook for Compound to use moving forward.
- Every day that AlphaGrowth works on behalf of Compound, our domain knowledge of the DeFi Landscape expands, providing us with the experience necessary to better serve Compound.
We would like to thank Compound DAO for all feedback provided over the last four months, and Delegates for their valuable insight and support.
