Token Lockups Prevent Governance Capture
Q&A with Raihan Anwar and Colby Holliday from Friends with Benefits
The key point was incentive alignment, FWB took a public, easily tradeable token and made a venture round behave more like patient inside capital than a fast moving whale position. Investors had already joined as paying members, the token allocation came with lockups, and voting power was meant to be delegated toward crypto native groups instead of concentrated in one fund. That reduced the risk that a large buyer could push price around and steer community decisions with pure balance sheet weight.
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FWB was unusual because the asset being sold was not private stock behind a cap table, it was a token already trading on Uniswap. In practice, that meant a fund could have built a position in the open market, moved the price sharply, and then shown up with oversized governance influence unless the round imposed extra rules around holding periods and vote delegation.
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The structure also fit how crypto investors like a16z were starting to frame responsible token deals more broadly. The emerging playbook was at least one year of full lockup, often stretching toward four years, with investors, founders, and other insiders on similar schedules so no one could dump early while still shaping governance.
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This mattered more in FWB because the community and the company were still being fused together. The team said they were leaning toward a C corp, but token voting remained the core governance rail, treasury assets were onchain, and membership curation in Discord still determined who could actually shape proposals before they reached a formal Snapshot vote.
This model pointed toward a hybrid form of institution building, where communities could raise outside capital without giving up the social legitimacy that makes the token valuable in the first place. The next step was turning these ad hoc protections, lockups, delegated votes, and legal wrappers, into repeatable governance standards for DAOs that wanted real capital but did not want a traditional boardroom takeover.