This paper outlines the development phases of a wave-driven Helicon Plasma Thruster for cutting-edge Low Earth Orbit (LEO) constellations. The two-stage ambipolar electric propulsion (EP) system combines the efficient ionization of an ultra-compact helicon reactor with plasma acceleration based on an ambipolar electric field provided by a magnetic nozzle. This paper reveals maturation challenges associated with an emerging EP system in the hundreds-watt class, followed by outlook strategies. A 3 cm diameter helicon reactor was operated using argon gas under a time-modulated RF power envelope ranging from 250 W to 500 W with a fixed magnetic field strength of 400 G. Magnetically enhanced inductively coupled plasma reactor characteristics based on half-wavelength right helical and Nagoya Type III antennas under capacitive (E-mode), inductive (W-mode), and wave coupling (W-mode) were systematically investigated based on Optical Emission Spectroscopy. The operation characteristics of a wave-heated reactor based on helicon configuration were investigated as a function of different operating parameters. This work demonstrates the ability of two-stage HPT using a compact helicon reactor and a cusped magnetic field to outperform today’s LEO spacecraft propulsion.