What are Helium founders breathing? A cheaper, longer-range wireless network

Imagine small, cheap, low-power sensors attached to all sorts of stuff people want to monitor: dog collars, rental scooters, irrigation devices, air-quality sensors, even water coolers.

Now imagine those devices communicating over a new, longer-range network — a low-cost, decentralized alternative to the big cellular networks maintained by companies such as AT&T and Verizon — created by regular people who place gadgets on their windowsills that sensors connect to, in exchange for a tiny cut of the revenue the network generates.

That’s the vision of San Francisco startup Helium, which last week started selling its $495 Helium Hotspot in Austin, Texas. The book-size devices are coming to San Francisco, Seattle, Portland, Ore., and other cities in the fall. Helium says its LongFi technology has 200 times the range of Wi-Fi, so just 100 to 200 hotspots can cover an entire city.

Like Wi-Fi, LongFi operates in unlicensed spectrum, so it does not need to buy pricey airwave licenses, Helium said. AT&T, T-Mobile, Verizon and others spent $2.7 billion on 5G licenses in a recent government auction.

“We’re building what we call the people’s network,” said Helium CEO Amir Haleem. “Everyone can participate, acting as a wireless network operator.”

Here’s the catch: The rewards aren’t in cash; they’re in a bitcoin-like cryptocurrency Helium is issuing.

The concept raises lots of doubts: Will regular consumers buy the expensive hotspots, which don’t provide them any immediate benefit? Will the cryptocurrency scheme work out? Will components be available for hardware makers that want to adopt LongFi? Haleem notes that people initially said Airbnb’s peer-to-peer approach to lodging was insane. “In the early days, it’s a big leap of faith,” Haleem acknowledged.

But Helium has attracted serious interest and $51 million in backing from the likes of Union Square Ventures, GV, Khosla Ventures and Salesforce CEO Marc Benioff.

It has also signed up some impressive customers and early testers. Lime, the San Francisco scooter startup, wants to better track its vehicles. Nestle wants to monitor office water coolers to know when they need refills. Agulus wants to get data from its irrigation valves and pumps. A pharmaceutical company would like to build trackers into the caps of medicine bottles, Helium said. They all see value in untethering devices.

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