Investing in Daylight

Two years ago when we published our thesis on the yet to be named DePIN category, we called it Token Incentizied Physical Infrastructure Networks (TIPIN). At the time there was a clear strategy of using tokens to incentivize the build out of physical infrastructure in anticpaition of future demand. When we first met the Daylight team, a group of deep energy industry insiders, the model to launch this style of network was clearly focused on supply. 
After co-leading Daylight’s seed round in the spring of 2022, markets collapsed and the air literally came out of the balloon on Helium. Faced with an uncertain market, the Daylight team made the brave decision to turn the DePIN model on its head and focus on the ever elusive demand side. Over the past two years while the DePIN sector was blowing up, the Daylight team has been relentlessly focused on demand. The team started with building out the Daylight Marketplace, the first demand side application of the Daylight Protocol before turning to the protocol and starting today -  the supply side.
Let’s dig in to how Daylight works and why it matters.   

The Demand Side - the Daylight Marketplace is the first demand side application on the Daylight Protocol. The marketplace facilitates the design, engineer, and procurement of the full suite of energy upgrades: solar, batteries, EV chargers, heat pumps, insulation, and hot water heaters. The marketplace is already working with local energy companies serving 10,000s homes across New York, New Jersey, and Pennsylvania, with Texas and California coming onchain soon.

‍The Protocol - the Daylight protocol manages an economy of energy capacity and data and incentivize users for providing energy capacity to its open-source network with it’s native energy backed token.  

‍The Supply Side - starting today, protocol contributors can download the Daylight App to earn rewards for connecting energy devices like thermostats, batteries, electric vehicles, and solar inverters, and engaging with the app. Contributors can also connect a SOON to be launched  custom energy meter to collect real-time, standardized energy data. 

An Unstable Grid

Electricity demand is surging, from the Tesla in your driveway to the never-ending ChatGPT queries, our thirst for electrons is not going away. Even Mark Zuckerberg is pointing out that it is energy, not compute that is the primary bottleneck on Ai growth. At the same time that demand for energy is soaring, renewable energy including solar and wind is rapidly accelerating. At first glance this would seem like a net positive but due to renewable’s intermittent nature, the energy supply is becoming more erratic. These converging forces are resulting in an increasingly unreliable energy grid and more blackouts. Everyday stories like this one in Time Magazine pop up to discuss how our antiquated infrastructure is not ready for not only the green transition but the expected growth of AI. The energy problem is only compounding.  

Finding Daylight 

One solution to this problem has been to decentralize the grid. By leveraging distributed energy resources like rooftop solar panels and batteries, energy generation and usage is pushed to the edges where consumers are. By decentralizing the energy production and consumption model, we free up capacity in the core grid without having to invest trillions of dollars in new energy infrastructure.  

Despite the massive benefits of distributed energy resources, adoption is not keeping pace with demand and almost exclusively relies on top down systems like government issued credits - Daylight is changing that. In the same way that the Daylight team turned the DePIN strategy on its head by focusing on demand, they are also flipping the incentives for the adoption of distributed energy resources. Daylight is taking a bottoms up approach directly connecting all relevant stakeholders - energy retailers, VPP aggregators, asset developers and consumers and all coordinated by a protocol of crypto economic incentives. 

We are thrilled to continue the journey with the Daylight team and invite you to get involved today by downloading the Daylight App and connecting your home energy devices. You can also interact with the Daylight Marketplace to explore distributed energy upgrades that make sense for your home or building.