The Generalist - Helium: The Network of Networks

Hey friends,

One of the most common critiques of crypto is that it doesn’t have any practical uses. I’ve been fascinated by Helium for some time because it feels like the cleanest riposte to that argument. Not only has the decentralized Internet of Things network leveraged blockchain technology and token rewards to great effect, it couldn’t have reached its current zenith without such innovations.

Getting to this point has been far from easy. Helium is a testament to entrepreneurial grit and iteration, with co-founder Amir Haleem trying out multiple models before pivoting to a crypto-native approach.

Though Helium’s fully diluted value surpasses $2 billion, it’s hard not to feel that much more is to come. Later this month, the project will kick off its “Cellular Summer” initiative, signaling the launch of its 5G network. Given the revenue opportunity Helium’s original network presented and the value appreciation of its token, investors may find it a valuable time to study the project.

To learn how Helium is disrupting the $1.6 trillion telecom industry, jump in.

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HELIUM: THE NETWORK OF NETWORKS

Actionable insights

If you only have two minutes to spare, here's what investors, operators, and founders should know about Helium.

• A practical use for crypto. Helium is the counter-argument to the criticism that crypto serves no real purpose. The company has leveraged token incentives to deploy and operate the largest IoT network in the world.
• A new revenue opportunity. Helium hotspots earn “HNT” tokens in exchange for contributing to the network. While rewards vary, some hotspots may have taken millions in earnings. Professional web3 implementation businesses have arisen to capitalize on the opportunity.
• Leveraging unlicensed spectrum. Traditional broadcasters and telecommunication businesses rely on licensed spectrum. This is purchased from the FCC and promises an uninterrupted connection. Projects like Helium use noisier but cheaper unlicensed spectrum bands.
• Growing opportunity and complexity. Though Helium’s network has a massive range, it is processing relatively little data. To bring more demand into the system, Helium is expanding beyond IoT. It hopes to provide infrastructure for 5G, WiFi, VPN, and other networks. While a considerable opportunity, each new network adds significant complexity.
• “Cellular Summer” is about to begin in earnest. Helium’s quest to build a decentralized 5G network is expected to kick off later this month. Participating hotspots will earn a new token, MOBILE.

***

Even if you’ve never heard of it, there’s a chance you’ve interacted with Helium before. Founded in 2013, the decentralized wireless network has grown to become the “largest continuous wireless network in the world,” according to founder Amir Haleem. Focused on serving the Internet of Things (IoT), Helium has a presence in 65,000 cities and 170 countries. Close to a million Helium hotspots blanket the world, quietly connecting intelligent devices to the internet. The Lime scooter you ride around your neighborhood, the perky smart fridge that cajoles you to buy more eggs, and the doorbell that tells you UPS has arrived may all rely on a connection to Helium. So too do soil sensors, air pollution systems, and dozens of other gadgets and apparatuses we interact with and depend upon.

Though Helium’s scale is remarkable in and of itself, its infrastructure is its defining characteristic. Haleem’s project is built on the blockchain and propelled by token rewards it gives to those who secure the network. Owners of Helium’s hotspots not only contribute to decentralizing access to the internet, they earn “HNT” as their node in the network is used. It is one of crypto’s greatest accomplishments and a clear demonstration of its use.

Helium’s revolutionary premise has catapulted the project to a fully diluted valuation of $2.2 billion, down from a 2021 high of approximately $12 billion. In February of this year, Andreessen Horowitz and Tiger Global co-led a $200 million investment into the firm.

Despite such strong validation, Helium’s best may be yet to come. Earlier this year, the company announced it was entering “Chapter 2” of its story. As part of this evolution, the firm will expand beyond IoT, starting with its 5G rollout this summer. In time, Helium hopes to support WiFi, VPNs, and other protocols. In that ambition, it seeks to be a true “Network of Networks,” orchestrating systems that will improve billions of lives worldwide and take power out of the hands of centralized incumbents.

It’s an audacious vision that brings real risks. Not all of Helium’s existing users have taken kindly to the introduction of 5G and the changes it brings to existing reward structures. Managing multiple economies and subDAOs sounds fiendishly difficult on a dozen different levels. And yet, with a global telecom market worth $1.6 trillion, the opportunity merits incurring such challenges.

Whatever the outcome, Helium has already had a startling impact, pioneering a new business model for building infrastructure and demonstrating the utility of cryptocurrencies. We’ll explore those ideas in today’s piece. We’ll also cover:

• Origins. Founded by Amir Haleem and Shawn Fanning in 2013, Helium went through several pivots before landing on the version we see today. It is a story of entrepreneurial grit and ingenuity.
• Product. Helium is a blend of hardware, software, blockchains, and decentralized governance. Managing such a myriad is no mean feat.
• DeWi. Telecom is a massive market with a handful of major players. It’s also a sector with strong governmental ties. For these reasons, many believe “Decentralized Wireless” or DeWi is necessary.
• A network of networks. After creating the largest IoT network in history, Helium has ambitions to support other networks, including WiFi, VPN, CDN, and 5G. Doing so has required a fundamental redesign.
• Winning the 5G war. Helium’s next test is to roll out a decentralized 5G network. This time around, it faces competition from players like Pollen Mobile.

Let’s get to it.

IN A MEME
​​​​​​​​​For the pictorially inclined, here's the whole piece — all 6,800 words — in a single meme.

PUZZLER
​​​All guesses are welcome and clues are given to anyone that would like one. Just respond to this email for a hint.

Attison B broke the brief, luminous reign of Greg by responding fastest to our prior puzzler. He was joined by Vatsal G, Jim W, Elijah D, Ibrahim A, Alan D, Harry B, Donald H, Joshua K, Prasanna D, Neil P, Neal K, Lawrence L, Mayur P, Lucas S, Brett L, Areeb Z, Keshav V, Rune W, Michael O, Misagh A, and Tanay N. All saw through this cheeky number:

The answer? Beauty. Because beauty is in the eye of the bee-holder. A good old punny puzzle. Well played to all that found the wordplay.
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​Until next time,
Mario