New Business Model for IoT Expansion
good afternoon everybody how's everybody doing out there this is steve brummer from bh iot group a partner in a firm and i am happy to be here with Dal from Helium and Fabio from Tago. I think this is what number three for us Fabio, in our in our executive series of uh events where we're inviting someone within our ecosystem to come in and talk a little bit about their company and what they're doing and so we're honored today to have helium with us and we're looking forward to the discussion again these executive briefings are are sponsored by TagoIO and what we're doing is trying to get really cool subject matter experts here to be able to talk a little bit about what they're doing what they're seeing in the market these are quick hits you guys will be done in 20 minutes or so so we would be able to get through the subject areas that we're trying to focus in on and go from there so without any further ado let Fabio our sponsor from Tago please introduce yourself and tell us a little bit about your firm and give us some insight sure is it it's great to be here again uh yeah that's the third one already so i just said you really want to bring interesting points here for for discussion right something new something really interesting that you don't see every day so that's why you are we're bringing healing today so I'm Fabio Rosa, I am the CEO and founder of TagoIO. TagoIO is a cloud platform that makes really easy to create applications for IoT to bring information from sensors to the business and uh we are going ahead and growing now we are in more than 100 countries with almost 400 different kind of connectors for sensors and a lot of applications really more than 1,000 real applications in the IoT space um so basically we did in a way that the platform is easy to be used it's free to start so people can just jump connect with Helium and select the device and start to build all the dashboard visualization and more than that really go to the business and starting to show to their peers to their manager and also to their customers using our futures fantastic and doll once you give us a little introduction on you what you do for helium and give us a give us a 10,000 foot overview of Helium. Sure first of all thanks Fabio and Steve for inviting us, and to all the folks who are joining us. so my name's Dal Gemmell and this is my fourth year at Helium my title is head of product marketing and planning but uh i'm at a startup and you wear multiple hats and you just get stuff done so uh helium was founded in 2013 and in the last few years built the world's largest public IoT network what we call the people's network today we announced uh 29,000 hotspots deployed so that's all over the world in many countries, thousands of cities, and we're averaging less than a week to add another 1,000 hotspots so before this time next week there will be over thirty thousand and there's actually 200,000 plus on back order from our hotspot manufacturer's suppliers wow so we're excited about growing this network it's really taking off and the way that we've done it is through a very unique business model where we are using a cryptocurrency to incentivize anyone to host a hotspot provide coverage and then become rewarded for providing that coverage so we've been around for a while we've built our own protocol blockchain and we're very fortunate to be backed by some of the most reputable vcs out there like coastal ventures google first mark and most recently union square adventures and multi-coin capital excellent thank you very much for that so i'm gonna i'm gonna throw on well first of all again i'm steve brummer with bh iot group we're an international strategy advisory firm in the iot space been in the iot industry for well over 25 years our focus is helping companies with their monetization and commercialization strategy it's great to be able to have disruptive technology like these two gentlemen have but we also have to figure out how to make money and how to bring those products to market successfully because iot is still kind of hard there's a lot of moving parts and all of them have to be squished together in order to provide a customer with a solution that solves a problem and so we help companies around the world do that so if you need any help around there we're the guys to go to fabio i want to talk real quick about your technology and and adoption of LoRa and adoption of iot in general are you finding that there are still what are the key things that are still missing for us to get stronger adoption in the marketplace yeah uh for sure i believe that there is always something else that we need to do i mean every player that we talk uh in the industry always think about okay what's really missing uh the way you see basically you can see it from different things but you see relates to people technology and the business demand right and i believe that when you see for people side you see that there is a need there people understand now that that was not the fact a couple of years ago when they talk about iot and say okay it can be anything now it's much more clear so the people component in our view the expertise is is there right the other side is the technology the technology was here uh for a couple of years but it didn't mean that was ready and available uh for example again i'm talking very clear about that uh talking with helium right or we have customers coming to us wow that's great i have the sensor uh so i have this technology i have it how io i can build things here how i connect that stuff right do i need to call a network server how right so it's a little bit more time now there is it's much easier to do that so technology is here and the less the business as you said at the beginning steve right we need to make money or you need to somehow generate value right we have makers that are doing that application doesn't and that they don't want to spend a lot of money and wants to create something so that's great so the business should be there but we have the component that the cost that is dramatically changed in the last months or year okay connectivity is much more interesting now right the cost of your connectivity uh and we're not gonna talk about that right the sensors costs are reducing a lot so frankly i believe the barriers now are much lower so it's really about working together and the bringing the innovation to the marketplace so i don't see that there are big issues uh now that you cannot uh uh go ahead and move and create the solution i think others will see these and say okay i can do that so don gonna twist the conv the the question a little bit differently for you from a helium standpoint looking at value proposition one of the things that that uh that fabio talked about was people technology and business needs can you kind of address those as it relates to your marketing and and how are you handling that and and what's what's more important is it just the people is it the coverage that you're building is it the technology that you're using is it the crypto uh revenue generation scenario for people yeah thanks steve, i think that the you can't really isolate these pieces right these pieces have to be all working together and one of the one of the reasons why we feel we're successful is you know we have built this network there's a foundation of core technology that you know we have built it's open source so we built our own protocol blockchain and the team worked very hard to create and build something that would support an iot network right so back in 2016 2017 when they were surveying there was nothing out on the market that could support the type of asynchronous nature and the number of transactions that would happen on this network so for the core foundation of the blockchain obviously critical having people and and making it accessible to anyone to host these hot spots providing the coverage you can't have one without the other uh and you know we if you take a step back it's really about like do you believe in in a in a centralized or a decentralized approach to be successful for this type of network right um we have seen a lot of wireless providers go down a centralized approach and because there is so much capital infrastructure all that stuff needed to create that network um there's lotteries of entry there you get a monopoly or a very small number of players that are actually um controlling this uh accessibility and connectivity uh and we see what happens right um it's i don't know anybody who says or gets excited about their telco and says you know i love it it's fantastic and they're awesome give me more yeah exactly like hey you have unlimited but you're capped okay how does that work and and but then you think about like a decentralized approach where you know there is there is nothing um there's no one company that says hey i'm going to cap you right or like uh if you're a social media player like youtube you can say hey i don't like your face so we're not going to put you on youtube anymore right a wise man once said that um so so we feel uh at the time the company said look there's no way that we're just going to go and kind of do our own thing and try to do the centralized approach and build this network it's been tried before it's not going to work the economics are not going to pan out so let's take this decentralized approach we're going to have to build this foundational technology make it open source be very transparent and we need to make the experience of users and as fabulous as kind of make like streamline and make it very simple for anyone to participate and and that's the only way that you're really going to build this type of coverage at scale but doll so what problem does helium solve for us in the industry well i i mean i think the the big problem is is coverage right affordable coverage that's ubiquitous uh we we you know you we were talking before we went live and we would go to these conferences iot conferences and soon don't worry we'll get there back in the day but um one of the uh one of our big taglines was iot has failed right and it was it was great because it was you know it was catchy and people would come over and say well you're at an iot show how can you say iot has failed and we would and we would say that we would ask the question back to them do you think it's been successful and they'd be kind of like humming and hawing and well yeah i guess i guess not really anyway the point is that up until helium you had very limited number of coverage options right you could go and build your own and now you're suddenly a network provider but that's not my core competency i want to build up these sensors i want to monitor and analyze this data i don't want to deal with hardware deployment and monitoring and maintaining that right right so that was one approach you could do the other approach is you you work with a network provider but they have their own private network and so if the coverage is good for that specific area great but if you go to other areas where they don't have coverage then you're you're kind of out of luck and and so we feel that providing this affordable ubiquitous coverage is something that's really going to help um as as Fabio said you know make this technology more accessible uh and you know i really feel that you know we weren't there wasn't any favors from the media about all the hype around iot right the overhype but i really feel that this is something that is in its very early days still so because yeah that's right so if you think about like the internet it's very early days it was very hard for people to kind of wrap their head around how you could actually use this network of networks and you know send email came along and kind of web browsing but but at the time people weren't thinking about Uber or Doordash or Airbnb right right and so it's really exciting the potential of this network and all the applications that can be built on it yeah i totally agree with you i mean there's so many times where i get asked of comparing the internet age to the iot age because listen you could be a soothsayer and say i'm going to have 50 billion devices on the network i don't really care about that as much as i care about what we're doing for the industries that we're addressing and the problems that we're trying to solve so and and so Fabio taking that into consideration the problems that toggle solves for clients are they more in vertical market segments that are more usable the usability of iot is is more prevalent but you know so how do you approach problem solving for your clients yeah so one thing we create several user case and templates try to help customers sense the beginning in the first phase uh we try to be very close to them even knowing that we have users around the globe that they just sign up and uh for free they started paying Sunday night you don't talk to them before but when you have opportunity or try to automate to send information so they can get the most in their journey right so we classify where they are they are at the beginning which vertical they are or they have more experience because that's is very important and uh we see some verticals that we consider extremely uh important and we can see things like work in the buildings sector or also the retail sectors are the sector that you see uh that when you have this coverage you know the initial phase of that but if you have something you can already start to generate value when you think about it the transportation sector that's much bigger that depends much more coverage is okay now maybe it's not there yet but if you get some of these that are more like facilities hospitality uh these are the sectors that we haven't been talk to customers and they say okay that's make total sense because we really want to be very clear at the beginning right you need to do this investment but the minimum that you can do there uh the better okay thank you doll tell us what the cost structure is around helium um it's the people's network so tell us what how how's it all set up i mean two hundred thousand backordered i'm not even - i'm not even going to ask why i mean we all understand the chip and the you know chip shortage and the crystal shortage and everything else that's going on especially you know i you know from Iraq wireless and all the other people that are involved in in supplying routers and gateways but you know tell us what the cost structure is around the helium because so many people don't understand really what it's all about sure um thanks Steve, great question so when we think of helium we really um frame it as a two-sided market so there is uh folks who are providing coverage and and are hosting hotspots and then organizations who are actually using the coverage provided by the posters so let's start with the hosters who are providing the coverage so if i'm a if i'm interested in this project and i want to provide coverage and minor cryptocurrency then i would work with a third party i would i buy a hotspot from a third party and so helium made a strategic decision to say look we are not we are not going to be the only ones providing these hot spots we are going to open this up we are going to work with other hardware manufacturers who um you know they eat breathe and and just totally focus on on building hardware supporting it all the logistics right and so we've got a number of partners and it's continuing to increase numbers but that's helping from manufacturers of gateways that's right okay and so that's doing two things one is it's providing competition in the market and two it's removing us as a bottleneck of being the only uh provider of this hotspot to make it really decentralized so i could but i could buy the gateway from you as well no i cannot okay nope explain yeah we uh we made a decision to say let's get uh third-party manufacturers involved and let's remove helium because again that's not our core competency must get folks who know what they're doing and can do it at scale if we really want to blow up this network and the more hardware manufacturers that come on board as i said the more options and choice for folks and the competition will help drive prices down right so that's on the coverage exercise so you can go and you can buy a hotspot from any one of these manufacturers unfortunately there's a huge back order because um the problem isn't of demand it's supply yeah we know yeah yeah so that's on the coverage side now on the usage side because we have this very unique model to provide coverage we can offer usage costs drive down usage costs so as an example if i am if i'm a company and i want to use the network uh all i need to do is buy something called data credits and you get data credits by converting hmt or you can just purchase them directly using a credit card you buy data credits and data credits are a specific price so there's no fluctuation involved in cryptos just it's kind of like mobile minutes for a phone so if you had a sensor and it was sending temperature humidity location data what have you if you had a sensor and it was sending every five minutes by the end of the year it would have sent over a hundred thousand messages and the total cost would be just over a dollar wow yeah so that's um using this unique cryptoeconomic model and incentivizing holsters to provide the coverage we can the cost can be driven down and uh you know this is we think it's a game changer in terms of making it more accessible to a huge audience excellent so Fabio i'm in the vertical market segment that you guys have a lot to do with uh let's just say a smart building i want to put up a smart building and i'm going to go use the helium network with a gateway of choice can i come to toggle for the platform integration the application solutions uh you know off of the helium network yeah perfectly for sure what you have done uh and let's say in march we integrate both platforms so in a way that's pretty safe i mean secure and straightforward to get your device connect first there and helium and then get authorization to send it to your target your account um we have then models that you can get as template from dashboards but not only that right if you need to create reports if you need to send a notification and great access to other users you can do this from time even the free account uh and the one thing that just complements uh get the points from that about the cost i think again about the business mode right like if you send a sensor temperature a humidity five minutes for one year about part one dollar uh tavo has similar model okay it's not related to the blockchain but is our crypto but to relate to the how we work don't charge per device we charge per transaction so it works extremely well so i would say that probably to have a sensor send that data to target store this data on tag but have all the visualization all user management translation dictionaries and so on you'll be probably about parked one dollar as well per year so that's is the match that's very important when customers have difficulties and say hey i cannot build that right i'm not a developer they can contact us through the website uh the customer success manager and i'm gonna have a conversation to help in that vertical to make sure that they can be implementable excellent so and and as we start to uh wrap this uh this session up uh many companies come to bh iot group uh with challenges of trying to figure out you know how to make it a little simpler this is a really you know still very complicated you know is it cost effective what's the ROI what's all those things that are there you know and then the monetization commercialization strategies that bh iot group does what's the biggest challenge that helium has it's a great question and i can't believe the the time is already i feel like you know we i know the three of us could talk all day i understand i feel like we're just getting warmed up um i mean i i think right now for us the the challenge as i said isn't about the demand and in about proving the crypto economic model right yeah um it's the market has clearly provided a strong signal that that this works and and there's a great article by one of our uh investors multi-coin capital um called the helium flywheel so folks want to google that and take a look uh he's um they're they're very sharp guys over there and he wrote an excellent article about you know getting really into the nuts and bolts in the numbers but but what we've discovered is that the because there is such a huge influx of demand and then pair that with semiconductor shortages and then add a pandemic which impacts the logistics and supply chain uh right now that's our biggest challenge right how to how to really fill the demand that's out there so that you know this network that's going to go from 30,000 goes to over two hundred and when you see a network that's over 200,000 uh 250,000 and the coverage is so ubiquitous that you know you really get the sense that all these ideas are going to start springing up and people and it's going to be a situation where you know if you talk to somebody today and you said hey could you run your business without the internet they'd be like no there's there's no way it's it's critical infrastructure for us right it's like electricity i believe in the not so distant future the same is going to be said about iot like could you run your business without the sensor data without having to send people with clipboards and writing down you know monitoring uh data readings could you still do that and i think a not so distant future yeah obviously it depends on the segment and the vertical but i think what we're going to see is people are going to say no there's there's no way there's no going back yeah i i think you're right because right now i think you both alluded to cost and the ROIs are more prevalent today than ever before in our industry and i've been as i said i've been doing this over 25 years today it has never been easier to do iot you know we have you have everything you need i i tell clients that all the time you can find the centers and find the edge computing boxes and the gateways and the comp and the networks like helium and the toggles and the platforms and the applications and the solutions and the business models um today it's an explosive situation you know unfortunately dull all of us in the industry are living through crazy time over the last 18 months but this will end and you know you have a 200 000 backlog uh you know that's that's serious numbers and serious amounts of people getting involved in this thing and it look you know and then you got you know Fabio sitting here going come on let's go we got to go that's a lot of people that could possibly use our platform you know and there's going to be companies that are going to need help like so we're going to be happy yeah so you know i think that's you know that's unfortunate issues that we have to deal with but i think you guys are you know you've come up with an innovative idea uh yeah extremely different than everything else that's out there um you know the kryptos thing you know i think you still have to educate you know you have to you know we all have to educate all the time but i think you have to get a little bit more of the word out as to what the hell it's all about how it works why you should do it um you know from that standpoint so you know it's just a fascinating uh program that you have come up with you know i'm a member uh you know i love the idea of what it can generate for all of us i think when you see the alternative of uh you know some of the other public carrier scenarios versus what helium is trying to do it's great competition it's great ideas uh you know i'll throw you know plus in for the centex of the world you know when we look at some of the you know the chipsets and the device manufacturers and the and the things that are going on our ecosystem continues to build which is absolutely amazing so uh Fabio i'm going to give you uh yeah you just want to quick get your point i mean i think you're spot on and you know we you know we're built on open source like our core technology all that stuff is open source and so we made a decision to go with the um you know LaRaWAN because it is also open source wireless protocol and and by doing that um you know anyone can take any off-the-shelf sensor that's uh lower when um compatible and start using it like right away and and i think to your point is these things kind of tend to feed on each other so you you know you mentioned you may have this chicken and egg problem right well do i if i'm a sensor manufacturer do i do this if it's not less coverage or do i build coverage if there's not enough sensors out there but as coverage grows and sensor manufacturers say oh wow there's there's a big enough market let's build out more sensors but maybe this was initially a niche market but now it's not um and so i think these things kind of feed on each other you get this positive cycle going and and it's exciting times yeah and but Fabio i'm going to throw in you know the the the option here a lot of the helium uh buyers or guys like me that have it upstairs in the end right where you have the gateways with the covered so it's but what about for sensors and things that i'm using at home or do we do does toggle look at the commercial enterprise b2b side of the growth of this for the helium network coverage scenarios yeah we don't work uh with both but we see a b2b for sure right to get the hospitality uh even the uh college right so we work with universities and uh that really goes to the market right it's not like he's isolating a bubble uh and uh just about the supply chain issue that you have today that is holding that all these 200 gateways right on the other side this creates a lot of opportunity for cargo because one of the verticals that is being growing a lot here is the supply chain because they found a problem because they didn't have sensors tracking uh their supply chain from the beginning to the end so this is bringing more and more demand so i see you know helium getting much more gateways pretty soon so uh we see really a big opportunity from the business side okay and they start a lot small but also we have a conversation for uh if the hotels right now about hey we need to apply this how are you gonna do do you need to get all these done at once how does it work you really don't need so it's to have in these gateways uh it's easy to connect any kind of sensors so that other big advantage right to have a 400 almost 500 connectors ready to go and all of them can be used uh with a helium yeah and i think i think that's right and and i'm assuming dahl you'll agree with this is that you know today we're looking at it from a campus standpoint or a building standpoint or a you know centralized coverage scenario on the b2b side until the people's network is truly across the country and everywhere you know and we we can look at you know logistics and transportation and movement because LoRaWAN is you know is fantastic on the road um but we need the coverage from that particular point but there's no shortages of opportunity doll for you guys from a campus in a building and a at a warehouse and a factory and you know the use of LoRaWAN in those situations and and if if the companies can get the gateways and go on your network and hop on and and get the crypto you know return on investment as well i think it's a win-win and you know and and Fabio wins too yeah i mean 100 it's um you know it was great to partner with folks like Fabio and Tago because you know they're they're providing this much needed uh critical piece right helium is focused on getting that data from the sensor to wherever customer wants it and purely securely with encrypted data people need that's right two 100 100 and and so what we you know we're seeing like smart mouse traps or tracking paragliders or you know stuff like leak detection and kind of the core monitoring temperature humidity to protect artifacts i mean it's it's really exciting times and and um you know where we're we're very happy that that what what we had uh predicted would happen is really happening and and we're very fortunate to work like uh with leading platforms like like uh Fabio and their team because they add all these capabilities with the data that you know that's just not what we're interested in and so it's it's really important to have those tight partnerships with this within this ecosystem and you're just in North America or you're just in U.S. today or where are you in terms of coverage yeah where are people oh steve we're everywhere wherever we steve it's amazing it's global man good all over the place excellent all right we are way over what we are planning on doing but the the chat message board is saying everybody's loving this so i figured well we just keep talking what the hell um Fabio one of the last questions i had for you as it relates to what we're looking at long term um you know this is complicated still you know we i know we are all looking forward to iot in a box you know with my devices and everything that's going on but you know how do we when we come to when people come to you do you make it easier for them i mean are you uh you know what's the is the business model coming through toggle a lot easier for companies to deal with yeah uh that's a great point right so for me is really about the target right what's the difference what they need what customer need and sometimes say hey frankly the last resource maybe you need to go in the other direction right but if a customer really looking for customization and that they cannot afford to you know build the whole structure you know that we probably are going to be the best solution for them right if they just want to have a dashboard and right away and they don't they want to modify anything what normally means that they don't want to really add a lot of values on top they may go to the other way right the key things is really about customization be simple but start is simple and scale so you can have a 50,000 you know sensors easily uh for for customers right and normally they start with a cup of 100 sensors so it's good so they don't need to make a huge investment at the beginning uh and the last question doll i promise well i don't know i'm not going to promise that so we're having fun here yeah we are um so some of the pushback that i have heard on the street about helium has been a lack of education and knowledge around crypto and h you know hnts and and everything else now you know from my standpoint my wife and i are extremely heavily you know we love bitcoin we we love coinbase we you know the whole model of around crypto so we understand it and we would understand where the value is long term you know as far as going through the exchange and and making money off of the crypto from you but is that still a deterrent do you think today as as part of your education that people are like i'm not touching crypto i don't understand it so i'm not doing helium yeah it's uh it's a very um it's a great question Steve um i think that's like my third great question today so i'm i'm very happy with where i am today you're you're on the roll um so so so quickly um because i want to be respectful of folks time um so we look at it from from again two-sided market coverage and usage and so the coverage side is uh we talked about the rewards that they can earn right as a utility token now folks may speculate on the value of that token but that's not we we do not want to go there right it's a utility token for usage on the network right from a usage side um the reason that we have both the hnt for coverage and then data credits for usage is that people who want to use the network they don't have to deal with people at all right that's right they deal with data credits again think of them like mobile minutes for a cell phone plan they purchase these they use them uh and they need more than they just purchased like gigabyte plans and things like that from you are they buying mac bulk data they can they can buy as much as they want right they can use their credit card they can they can buy it and uh the data credits are a fixed price so there is no fluctuation and so they don't have to worry they can plan their business they can budget accordingly and the cost is just based on usage now what is really exciting is that they've this core foundation uh technology and and blockchain is crypto economic model we have been focusing on iot because we saw there was a big need and demand there but there's not to say that this model can be applied to other wireless protocols or technologies and that and that's exactly what we're doing so today we announced that we are working with a company called freedom 5 for 5g coverage so that's that's a whole entire another conversation but if um if folks go to uh healing.com they'll see that and and to our blogs uh our ceo just
announced um applying this crypto economic model to 5g coverage with a partner called freedom5 so really exciting news excellent that's awesome okay guys 40 minutes we've been talking so much for this 20-minute executive session um okay dolls at helium.com for more information and to be able to contact you guys and and get that kind of uh get information on it fabio why don't you uh close us out uh and then are we doing another fourth session at some particular point so why don't you tell us all about that yeah sure so we invited uh lnx sensor industrial sense manufacture from australia to be our next partner here talking with us at the end of the next month so um we are going to i'm looking forward i i love what he's doing in that in that space he's got some really innovative and disruptive technology in the center space so i'm looking forward to sitting down and talking and talking to lnx very great all right and and how do we get a hold of you Fabio our website target.io excellent all right and i'm Steve Brummer uh i am a company with uh can you please name the company again from Australia oh Ellenex e-l-l-e-n-e-x exactly and that'll be next month right we're on a set up for may something correct so you'll see the information thank you very much everybody thank you in the audience everybody that has stuck with us for 41 minutes which is about 20 minutes normally more than we normally did but dahl thank you so much great information awesome time Fabio appreciate the opportunity this is Steve Brummer your moderator uh signing off and we'll see you next month thank you very much for your time have a great day!