a small but significant update
👋🏼hello, I’m fabri
founder, investor and advisor
Over the last quarter I’ve been taking a keen interest in the passion economy thesis from Li Jin at a16z. It’s a great essay, everyone should read it. It resonates with me because I’ve been swimming in the space since college.
I graduated with a BA in Journalism at the rock bottom of the traditional media industrial complex. I remember panel discussions over the pros and cons of paywalls on web 1.0 and when food bloggers where the original influencers (fun).
What got me into tech were not my coding skills but my college education.
My ability to understand how information travels throughout digital mediums has brought me some success in applying the same principles for the purpose of bringing a message or product to market.
Every year-end assignments would feature strategizing and launching a publication with a digital presence. Basically the job description of a modern content manager’s profile, we didn’t have a name for it back then.
This was less than 10 years ago. I’m young enough to have lived a fully digitally native childhood. Dual screen is the norm not the exception.
It’s with these eyes that I look at the world my ‘professors’ have built, a world that simply translated analogue formats onto a digital screen without accounting for the native applications of the medium (ie. live interactivity).
During my consulting days, our pitch argued that for the first time in history, the generation with the greatest spending power was going to be a digitally native one. Millennials.
By nature, a more ‘connected’ generation than any ever existed before. A generation defined by their obsession to themselves, each other, their environments, their favorite influencers and of course their brands.
We preached that business who’s embrace digital as their primary input of interaction would thrive in the information age. We were right, yet a good five years too early.
Millennials audiences and creators brought us new incredible interactive formats like the NYT piece on Notre-Dame or the Wall Street Journal UX team, platforms like teachable, substak or even, if you will, Mr. Beast.
Don’t @ us, boomers.
When I wrote my thesis last summer I overlooked some fundamental characteristics of digital goods:
(a) their value is extrinsic, meaning their pricing is in function of the relative value perceived by the buyer not the cost of the good sold.
(b) it scales infinitely, meaning that one idea can be syndicated across multiple formats with less capital than launching a new factory line.
(c) content is a vessel for ‘information’ a key tenant of... you guessed it, the information age.
The internet has slashed the cost of content production at the same rate as electricity slashed cost of light at the beginning of the last century.
Directionally, I’m comparing speed and relative utility of increased access of light versus information. ~1000x in 25 years for electricity vs $30k to $30 per live broadcast minute
Chart shows the price of Lighting from Gas, Kerosene and Electricity in the United Kingdom (per million lumen-hours), 1800-2000
A subscription to curated marketing content for a $10 a month is no different in value to the magazines I used to buy as a teen (photography and computers). That content taught me how to use dreamweaver and code my first website.
The social expectations haven’t really changed. I’m used to pay for access to quality, as a millennial I expect it. What is changing is the experiencing and experimenting of various user/creator formats.
Your favorite creators already have established presences on multiple platforms. Both free and monetized communities. This is the new status quo.
At the end of last year, 100 channels a day crossed the 200k subscribers mark and we know you only need a 1,000 True Fans to make a decent living.
I argue that we are entering a fifth step into the information age
Drop in cost of production
Advent of free mass distribution
Raise of digital advertising platforms
Growing market, both sides
Shift from volume to value enabled by digitally native formats
We are in the early days of the creators industry and I believe that digitally native formats will be the next vector of value creation, one so big that it will significantly increase the total market size. (think of esports or interactive live podcasting).
Clearly, the types of businesses and long-tailed communities this revolution enables is completely different then the one I was thinking about just a few months ago.
The ability for content creators to segment and syndicate their value will create an unprecedented social channel for social mobility in history. Much bigger than small businesses or real estate have done for the two generations prior. This is our vector to grow our generational wealth, our oil, our finance markets, let’s make it count!
The question that bugs me is: how can we embrace digital native features (ie. interactivity at scale) to create a whole new category of formats of product enabled media?
Knowable are monetizing value over volumes leveraging podcast formats. Blinkist has been doing something in an adjacent space for a long time. Substack is expanding aggressively. Teachable just passed the quarter billion in top line revenues. I could go on for a while.
If you are in the space I’d love to connect. I’m forming hypotheses for what an infrastructure for new product-enabled media formats could look like in conjunction I’m also building a small database to track companies, ping for access.
