This is where you upgrade troops, change their formation, recruit Mercenaries, convert/enlighten skills and produce Daru. The higher the level, the more Daru it produces on an hourly basis. Again, there is a 6-hour cap for Daru to accumulate before you need to collect it.
You can recruit friends you made to be Mercs to help you in hard/expert dungeon battles. Your first Merc unlocks at level 20, second at level 30 and third at level 40 for a maximum of 3 Mercs who you can take into battle with you. Even though there are six slots available, the max number of your team is four. The difference between you and your Merc cannot exceed 4 levels, however. It is important to strategically arrange the placement of your team so that tanks are in the front (Knights) and for the most part, Mages are kept in the back.
Conversion: You can increase your character's HP, PATK, MATK, PDEF or MDEF stats by a percentage of your troops' stats. The default is HP, but you can convert it to one of the other stats by paying balens or daru.
Enlighten: By paying the required amount of daru, you can increase the percentage of the chosen stat. Of course it will cost more daru as your level of enlightenment increases.