Attention is the New Oil
Why attention is a resource worth prioritizing for in modern start up building.
“My formula for success is rise early, work late, and strike oil.” - J. Paul Getty
Oil at its simplest form, is the lifeblood that underpins the relentless march of human progress forward. It is the most fundamental of modern civilization’s building blocks, as its refined state has provided the raw energy needed to build much of everything you see around you. Oil is modern capitalism’s oxygen, a prize of once incalculable worth, which is why those who control it, wield it, and disseminate it, have been so regally rewarded throughout the annals of history. For the last two centuries, it has been oil, far more than gold, that turns mere mortals into deities of unlimited means.
It is no wonder then, that the human conquest for oil has been a pervasive, oftentimes frenetically violent, function of modern endeavor ever since Edwin Drake first used a repurposed salt well to investigate suspected oil deposits in Titusville, Pennsylvania back in 1858. Little did Colonel Drake realize, when he broke through the gravelly Pennsylvania dirt with his steam-engine drill all those years ago, that he would set off an acquisitive arms race that would traverse the globe from the rolling plains of Oklahoma, to the arid deserts of Saudi Arabia, all the way to the unrelentingly humid jungles of the Niger Delta. The first crusades were to spread religious doctrine, the second, to acquire the most ubiquitous building block for the contemporary world.
It was not long after this initial discovery, that oil soon became perceived as “black gold”, immediately establishing a new manifest destiny in the minds of eager entrepreneurs who felt as though they had missed out on the riches associated with the initial westward expansion. The promise of oil —- the alluringly viscous, dark, bubbling, treasure trove that existed just a hope and a drill away, spoke to a certain type of radical. A person who had no qualms in uprooting their entire life to move to the most untamed reaches of the country with the oftentimes misguided fantasy that things would not just work out, but succeed in a way that would enable a level of generational excess beyond their wildest imaginations. Some were right, most were wrong, and dreams were both built and shattered indiscriminately across the far-flung and barren landscapes that constitute the majority of this nation.
However, in the modern day, there is a new oil. A resource that has always existed, that those who are insightful enough to take advantage of are now prospecting en-masse. It those who are thoughtful about this search, and often times a little bit lucky, who are able to shift their existence away from insignificance, into providing a pervasive type of generational value. Attention, and the ability to both capture and wield it, lives beneath the very feet of many of us, but it is only those wild enough to drop everything to go find and acquire their well, that will be rewarded in the modern day beyond their wildest dreams.
Scarcity vs. Utility
The world has been commodifying things since man first traded goods and services, and each time such an exchange occurs, the inherent value of said good or service shifts from scarcity to utility. This is especially true of resources in abundance, items and offerings that are largely interchangeable, with low differentiability. Oil, in the modern day, is obviously a clear example of this. Whereas it originally started as a somewhat rare resource back in the days of Edwin Drake, the industry has become increasingly saturated with up to ~20 million barrels of oil consumed in this country per day (and 1.73 trillion barrels of oil remaining to be drilled, which not accounting for undiscovered reserves, of which there are many). Thusly, the average person does not care where they get their oil, and are willing to stop indiscriminately at the most available petrol-station to supplement their needs, without much second thought.
The level of commodification that you see above for oil can never happen to attention. Why? Because attention at its core is a fundamentally finite asset, which means there will always be a certain level of scarcity value associated with it. You can not manufacture more attention — as it exists as a set resource. While the competition for this may get increasingly fraught with opposing forces, the proverbial pie hardly gets larger, just your ability to acquire a slice.
The way that I like to think about this is via a very rough, yet illustrative equation (especially relevant to internet-enabled attention):
Moreover, while not only finite, all attention is not created equally (unlike oil in the modern day), and therefore it is difficult to argue that the most relevant forms can ever be commoditized. Depending on your goals, there are many ways that one can parse this attention — whether it be by geography, age, income, or any other of the many attributes that we often use to group people together. Capturing the latent attention of the group(s) most specific to your products and services supercharges the speed at which you can find your own product-market fit. It also allows you to build a brand, which in turn affords an incredible amount of optionality in the way you sell through that branding. When people inherently care about what you are doing because of the brand that you have built, the breadth of your future endeavors can be immense - as your audience cares less about what you do, so long as you are doing something that they can interact with.
The Modern Prospector
In the modern day, there are a few examples of people who have prospected and retained attention at a scale which has created generational brands (and by association, businesses) as a result:
Rihanna
With 70.51 million monthly listeners on Spotify, and over 18 billion views across Youtube, Rhianna is one of the modern music industry’s greatest success stories.
Off the back of this captured attention, in 2017 Rihanna launched her own make-up brand, “Fenty”, which at the end of the first calendar year of operation, had generated $550 million worth of revenue.
Speaking to optionality, Rihanna continued providing value to her latently attentive audience by launching a lingerie brand, “Savage X Fenty” in 2018. By 2021, as a result of a funding round from L Catterton, Avenir Growth Capital, and Neuberger Berman, “Savage X Fenty” was valued at $1 Billion just three years later.
Mr. Beast
Jimmy Donaldson, also known as “Mr. Beast” is YouTube’s most successful creator. With 133 million subscribers, Jimmy has greater than a Super Bowl sized audience for any of the videos that he puts out. This is on top of another 23.3 million Instagram followers, 18.4 million Twitter followers, and 76.4 million Tik Tok followers. When it comes to attention, he is arguably the modern John D. Rockefeller.
Mr. Beast is one of the best examples of turning captured attention into a large, multi-faceted business. From just his YouTube channel alone, it is estimated that he makes over $40 million per year via AdSense and advertising deals. On top of this, in 2020 Mr. Beast launched a ghost kitchen burger chain called Beast Burger, which in two years has already done over $100 million in revenue. Finally, in 2021, Mr. Beast launched his own snacks company, Feastables, which is already worth $50 million after raising a round of capital from the likes of Alexis Ohanian’s 776, and Shrug Capital.
Kardashian Family
Arguably the most well known example of the attention to value pipeline, the Kardashian family exploded onto the scene in 2007 with their eponymous reality show, Keeping up with the Kardashians. With an average of 1.5 million live viewers per episode (and 10 episodes per season), the show propelled the group into the most well known families in the world.
With a combined 1.2 Billion followers on Instagram, and hundreds of millions of followers across other their social platforms, the family has used their attention to launch a variety of successful businesses such as:
Kylie Cosmetics
Kylie Jenner’s cosmetics line sold a 51% stake to publicly traded French beauty company Coty for $600 million. This reportedly netted Kylie approximately $540 million pre-tax as she had barely raised any outside funding.
KKW Beauty
Once again via Coty, in 2021 Kim Kardashian sold 20% of her makeup line, KKW Beauty, for $200 million (at an implied $1 billion valuation).
Skims
In 2022, Skims, the underwear line by Kim Kardashian, raised an equity round at a $3.2 billion valuation, via investors such as Lone Pine Capital and D1 Capital. Kim was able to achieve this valuation roughly 30 months after launching the company.
Jenner Communications
Owned by Kris Jenner, Jenner Communications manages and provides advertising services to the rest of the members of the family. It is reported that Jenner Communications is worth approximately $190 million.
Miscellaneous
In addition to the companies above, the family also has Kourtney Kardashian’s Poosh (said to do ~$15 million per year in revenue), Khloe Kardashian’s Good American Denim Line (worth approximately $12 million), and Kendall Jenner’s 818 Tequila line (which has yet to publish any revenue or valuation figures as of yet).
KSI / Logan Paul
In 2021, British YouTuber KSI (who boasts 24 million followers on YouTube), partnered with American YouTuber Logan Paul (who boasts 24 million followers on Youtube as well), on a electrolyte drink brand called Prime.
As of 2022, it was estimated that Prime had sold over 100 million bottles, and earned $250 million in retail sales in the first year. The drink reached viral success, and there are countless videos across social media that show frenzies of fans buying out stores of their entire stock as soon as they are put onto shelves.
In addition, both KSI and Logan Paul have burgeoning boxing careers, most notably Logan, who fought Floyd Mayweather and reportedly earned $20 million as a result of his 10% ownership of the pay-per-view. KSI, who has had a few fights himself, although with less popular opponents, reportedly has earned approximately $1 million per fight, for his last two fights.
Application to Startups
In the world of startups, where capital has been commodified to a large extent, attention becomes a differentiating factor that allows both people and organizations to supercharge their growth. Via branding, narrative, and storytelling (which the most successful “prospectors” from the previous section have mastered), companies can manufacture themselves outsized value while simultaneously creating meaningful flywheels across a few significant pillars. These pillars are oftentimes foundational to what makes a business, especially in its earliest stages, successful — therefore making the pursuit of underlying attention an extremely high ROI activity for founders of companies both nascent and established.
Hiring
While not nearly as competitive as the market in 2021 / 2022, human resources have always been a difficult nut to crack for startups, especially when competing in industries where there is low talent density with high incremental demand. As the importance of resume building via meaningful logos is one of the aspects of the modern job market that seems to be increasingly pervasive, the best talent largely goes to the companies and industries that have the strongest brand value.
While it is true that many people chose to go to companies like the FAANG due to their outsized compensation and interesting perks, a large part of these decisions are made off the basis of the idea that by working there, the search for their proceeding job will be made easier by an inherent brand equity built into the experience.
For startups, it is important to establish this type of brand equity via attention as early as possible, as it immediately allows young companies to be increasingly competitive against their much larger counterparts in the hiring market(s). Attracting good talent early will not only lead to meaningful results for businesses at a faster pace then would happen otherwise, but will also rapidly create a culture where relevant potential employees outside of the immediate ecosystem are increasingly magnetized to the mission.
Fundraising
Anyone who has hit a road show before knows this all too well — it is that story, and perhaps more importantly the way that the story is told, is oftentimes far more influential to fundraising success than the underlying venture itself. While this narrative has shifted meaningfully in recent months within the venture ecosystem (i.e. metrics increasingly matter more than ideas) many of us have seen over the last few years countless examples of businesses that have made little economic sense around their viability, and yet are been able to raise fantastic amounts of money time and time again.
The reason for this is simple: it is that venture, at its core, is the business of funding the promise of something great that may not yet be tangible in the present. As many of these ideas are five, even ten years away from their most preeminent form, the best founders are able to suspend the disbelief of their investors until the point in which the product actually catches up to the ambition. Success in this capacity is a function of being able to meaningfully articulate, both actively and passively, why investors should be willing to come along for the ride. If you are unable to explain why this ride is not only one that will be gratifying, but end with a creation of value that will reward belief in a substantial way, the likelihood of being able to raise money to support this dream becomes near impossible.
To caveat, while some may take this idea to the extreme and promise things that are not possible (which by no means I am advocating for), founders who become successful fundraisers are consistently able to toe the line of promises of the distant future, while rapidly building reality into that direction.
Product Adoption
You can have the most amazing product or service in the entire world, but if it is hard to understand, or unclear as to why it is important, it is unlikely that it will ever be used to the extent by which it deserves. While not exactly 1:1, there are many aspects of launching a product that rhyme with the the process of launching a blockbuster movie. Neither are easy, and if you cant get your intended audience to care, the likelihood of both failure and an incredible loss of money becomes very high.
Like feature films, there is a constant slew of products and services being released into the world, all competing for a little slice of time and attention from the group of people to which they are most relevant. There have been countless incredible films that have come out over the roughly one and half centuries that cinema has been relevant, that neither you or I have never heard of. This is not for lack of strong directing (strong founders in startup land), or a well selected cast (good team in startup land), or even the underlying plot (idea in startup land), but rather, because the organic and inorganic marketing associated with their release never made them compelling enough to break through our attention hurdle.
Time is our most valuable resource, and if there is no hook for us to spend it, then it is unlikely that most will take the leap of faith necessary to try something new. This is why in the modern movie industry, marketing budgets are typically 35% - 100%+ of the production costs of the film. A great example of this is the movie trailer — the rapid cuts, the booming voice of the narrator, the long shots of highly-regarded celebrities, all serve to not only generate interest, but incentivize consumption from the viewer.
“Great stories happen to those who can tell them.” - Ira Glas
Silicon Valley does many things exceptionally. Crafting and taking advantage of good storytelling is certainly not one of them. There is a large opportunity in the modern day, especially if you are building a company in the valley, to take advantage of this. It is likely your competitors (especially at the earlier stages), can not craft their own narrative in a systematized enough fashion where they are able to take advantage of the benefits that strong storytelling and attention capture can bring.
Become an oilman. Take advantage of what exists beneath your very feet. And in doing so, watch the world around you shift faster than you could ever imagine.
-EXITS
Your prose is life, my G
So what you're saying is, in the ubiquitous information world, attention is a highly limited but necessary component to do anything. (Data doesn't do anything without attention to it; AI is a way to focus data into attention.) 🤔 Just straight-forward enough to work!