A New Zealand Community Treasury Experiment Reopens an Important Question for Venture Funds

Every founder who has walked away from an investment meeting wondering why one individual, or one investment committee, ultimately decided the future of their business has encountered a governance problem disguised as a fundraising problem.

Capital formation has always been about more than money. It is about who gets to make decisions, how trust is earned, and what happens when those making those decisions no longer reflect the interests of the people they serve.

Those questions sit at the heart of venture capital, evergreen funds and, increasingly, tokenised investment structures. Which is why an experiment taking place thousands of miles away in community treasuries across New Zealand, Australia and here in the UK deserves more attention than its modest setting might suggest.

Mark Pascall, co-founder of The Wellbeing Protocol, recently published an account of governance experiments being run through hum, a platform managing shared community treasuries. Although these are not investment funds, they are managing a familiar problem: how groups decide where capital should be allocated.

The first governance model, Gov1, was straightforward where every member could propose spending and every member voted equally.

In theory it was highly democratic. In practice it produced something familiar to anyone involved in governance. Participation fatigue set in. Most members gradually disengaged while a relatively small number of highly committed participants carried the burden of decision making. The lesson that emerged was not that democracy failed, it was that asking everyone to evaluate every decision quickly becomes impractical.

The second model, Gov2, is considerably more interesting. Rather than replacing one authority with another, it attempts to make representation itself more accountable.

Four mechanisms underpin the model.

• Trust is continuous rather than periodic, allowing members to redirect support between elected stewards at any time instead of waiting for fixed election cycles.

• Support builds gradually through conviction voting, reducing the impact of coordinated campaigns or sudden swings in opinion.

• Quadratic voting makes it progressively harder for influence to become concentrated behind a single individual, encouraging broader consensus over simple financial weight.

• Finally, representatives who consistently lose community confidence step aside automatically, replaced by those who have accumulated greater trust.

Whether these mechanisms ultimately prove successful is almost beside the point but what is interesting is whether ideas like these have any relevance beyond community treasuries. This is not a new conversation.

The earliest enthusiasm around DAOs was never simply about putting company shares on a blockchain. It was about exploring whether capital itself could become more transparent, more accountable and less dependent on a relatively small group of gatekeepers. Could investors also support the businesses and contribute to their success.

Many of those early experiments struggled and many proved technically immature. Others underestimated regulatory complexity and many simply discovered that decentralisation is considerably harder in practice than it appears in theory.

However, the underlying question has never disappeared.

As tokenisation matures and regulated initiatives such as PISCES begin modernising private market infrastructure, attention is naturally focused on digitising ownership.

And perhaps less attention has been paid to whether governance itself might also evolve.

Q. Could investment committees become more dynamic?

Q. Could limited partners express confidence more continuously rather than every few years?

Q. Could governance become more responsive without sacrificing regulatory oversight or fiduciary responsibility?

These are not trivial questions, and they are certainly not easy ones to answer. Many of the governance mechanisms that appear elegant in theory become considerably more complex when applied to regulated financial markets. Continuous trust, for example, sounds appealing until a regulated fund has to demonstrate to its compliance function, auditors and regulators how decision-making authority can evolve in real time while still meeting fiduciary duties and maintaining clear accountability. Likewise, quadratic voting offers an attractive way of reducing concentrated influence, but it immediately raises practical questions about investor eligibility, governance rights, financial promotion rules and whether such a model could coexist with the legal responsibilities that fund managers owe to their investors.

None of these challenges invalidate the experiment. Rather, they illustrate why governance tends to evolve far more slowly than technology. It is relatively straightforward to design a new governance mechanism on paper; it is considerably harder to demonstrate that it can operate reliably within established legal, regulatory and fiduciary frameworks. Financial markets have learned this lesson repeatedly over decades of innovation.

That is precisely why Pascall's work deserves attention from the investment community. Not because it presents a ready-made blueprint for venture capital or evergreen funds, but because it moves the conversation beyond theory. Instead of asking whether different governance models might work, the hum project is testing them with real participants making real decisions over shared pools of capital. That makes it a far more valuable contribution to the debate than another conceptual framework or academic white paper.

Whether these governance mechanisms could ever find a place within FCA-regulated investment structures remains an open question, and there are perfectly credible reasons why they may never be adopted in their current form. Equally, history suggests that financial markets rarely embrace entirely new systems wholesale. More often, they absorb individual ideas that prove capable of improving transparency, accountability or the quality of decision making, while leaving the broader framework intact.

Tokenisation itself is following that evolutionary path. The technology is not replacing capital markets so much as modernising the infrastructure on which they operate. It is therefore reasonable to ask whether governance innovation may follow a similar trajectory. For founders seeking fairer access to capital, and for fund managers considering the next generation of investment structures, that feels less like a theoretical debate and more like an important question whose time has come.

Key Takeaways

• Governance is increasingly becoming a capital formation question, not just a political one. How investment decisions are made may prove as important as how assets are tokenised.

• The hum platform's Gov2 model replaces periodic elections with continuous trust allocation, conviction voting, quadratic voting and automatic steward replacement, aiming to make representation more responsive without relying on constant direct voting.

• While developed for community treasuries rather than investment funds, the governance mechanics raise interesting questions for venture capital, evergreen funds and future tokenised investment structures.

• The article does not suggest these mechanisms are ready for regulated funds. Significant questions remain around fiduciary duty, FCA regulation, financial promotion rules, governance accountability and operational practicality.

• As tokenisation modernises ownership infrastructure through initiatives such as PISCES and regulated digital securities markets, it is reasonable to ask whether governance models might also evolve alongside ownership structures.

• Whether continuous trust and similar governance mechanisms can improve capital allocation at institutional scale remains an open question deserving evidence rather than enthusiasm.

Sources:

https://www.linkedin.com/pulse/what-politicians-lost-power-moment-your-trust-mark-pascall-sqzae/ (Mark Pascall, published 13 July 2026, quoted and summarised with attribution from his public LinkedIn article)