Gen Z's Companies Are Here

In today’s edition

• What’s the deal with Cluely

• The death of marketing and customer acquisition standards

• Gen Z founders making waves, and the future of building companies

Beyond all this 👆 — today’s edition is about our future.

If you walked around Times Square last month, you probably saw Cluely’s billboard.

$375,000 — ridiculous, ingenious, stupid, valuable, wasteful, powerful, all of the above?

For a few months, Cluely was the talk of founders, VCs, and students alike. But this edition is not about them.

As you might imagine, I have no shortage of opinions on Cluely; and I will share them, but only to highlight the future of enterprise. Gen Z—my generation—has grown up. 🥲 It’s early, but we are building companies, and as we do it, we’re redefining the way businesses are born.

Today’s edition is about the future.

BEFORE WE START — SUPPORT RTF WITH 20 SECONDS

Former Zillow Exec Opens Door to $1.3T Market

Austin Allison sold his first company for $120M. He later served as an executive for Zillow. But both companies reached massive valuations before regular people could invest. 

“I always wished everyday investors could have shared in their early success,” Allison later said. So he built Pacaso differently. 

Pacaso brings co-ownership to the $1.3T vacation home market, earning $110M+ in gross profit in under 5 years. No wonder the same early investors who backed Uber, Venmo, and eBay already invested in Pacaso.

Now, after adding 10 new international destinations, Pacaso is hitting their stride. They even reserved the Nasdaq ticker PCSO.

And unlike his previous stops, you can invest in Pacaso as a private company. But you don’t have time to waste. Invest before Pacaso’s opportunity ends Thursday night.

_{This is a paid advertisement for Pacaso’s Regulation A offering. Read the offering circular at invest.pacaso.com. Reserving a ticker symbol is not a guarantee that the company will go public. Listing on the NASDAQ is subject to approvals.}

Roy Lee, the face of Cluely, was expelled from Columbia for cheating on an Amazon interview. His backstory illustrates the demise of traditional institutions’ power over adolescent decision making.

Roy went viral for his expulsion. He posted about it relentlessly, meeting social media at its peak obsession over the future of work. At Columbia, Roy built a screen recording tool to prompt an AI in real time as he interviewed for FAANG companies, and with it, easily passed through technical screening.

He capitalized on his fame, incorporated Cluely to mass produce his cheating tool, and raised a few million dollars within 24 hours. Incredible speed and delivery.

Not long after, they raised $15M, led by Andreessen Horowitz at a whopping $120M post-money valuation. I’ll get to a16z’s role in this narrative shortly.

When asked about his perspective on a life bereft of money and status, Roy said something incredibly revealing of his psyche.

Yeah.

My instinct is to reject this philosophy like a tumor, but the more I consider it, the more it reveals about today’s successful companies’ product-led growth motions.

Attention is the modern currency. Undoubtedly.

I agree with Roy on the importance of shortform content and virality. Both lead to the accumulation of currency; today, attention. The saturation of everything—truly, everything—has created the need for new deployment vectors of consumer captivation.

Anything practical one could want is within a few iPhone taps. Infinite intelligence. Food on the doorstep. A romantic partner. Consumers are numb to yesteryear’s relied-upon communication mechanisms. Marketing emails are mass deleted, and if read, not a word breaches surface-level processing.

But Gen Z wasn’t born in this world. We were born into social media, memes, and influencer mania. I can’t remember a world without any of these. Just as today’s children will not remember a world without ChatGPT. It’s shocking to consider, but if you don’t, you will be left behind, I guarantee.

The world is changing in how information is perceived and prioritized. Product matters very little. Marketing matters very little. Attention matters everything.

What if the optimal strategy for building a successful company today is finding a product that’s inherently controversial and viral, and using it as a trojan horse to build adjacent, more mainstream products in the future?

I can hardly stress how important this idea is. Gen Z was born to understand it, and we are reflecting it in the way our companies are launched. We are still early—I feel only a few are worth noting.

Cluely.

Series.

Poke.

Cal AI.

Virality first, attention first, community first. This is the new launchpad for consumer companies, and is a requirement today, not 3 years from now.

Attention is a commodity and a currency. Unlike the dollar, its supply is limited, and its intrinsic value increases over time as companies deliver more with less resources.

If you put aside the 0.001% outliers, legacy companies don’t know how to capture attention. Most of today’s new companies don’t. Attention is not distribution. Attention does not require conversion.

In a world where “ideas are worthless” meets AI copilots, all that matters is attention.

When evaluating a company, VCs should and must and will ask the question, “to what degree does this company control the narrative and wield attention?” To the same degree that they today ask about growth and retention.

Attention is a playbook. Attention is an investment thesis. When a16z threw money at Cluely with no regard for valuation, they used their spray-and-pray methodology to hedge against the destruction of traditional company-building methodologies.

Gen Z founders are uniquely positioned to accrue the currency of attention given the molding of our brains over the last 20 years.

Just as young Gen Z and Gen Alpha founders are uniquely positioned to build the most deeply integrated AI experiences we can fathom. I used GPT-3 for the first time in my senior year of high school. A couple years ago, at Alongside AI (shoutout), we built for middle schoolers who have no living memory without AI. Just think about that.

Attention is everything. I hope my message today comes ringing with FOMO. The world is shifting at a mind-boggling rate, and for what I’ve said today, AI is not the only cause. It’s time, nurture, and the progression of human attentiveness. I’m proud of and excited by my generation.

Attention is everything. I’ll be launching another company soon, creating an entirely new deployment vector for viral loops, consumer engagement, delivery of impressions, and attention captivation. I believe it will be generational in its flippancy—a staple of Gen Z companies—as a trojan horse to scaling the infrastructure of attention itself. But perhaps that’s the delusional Roy Lee in me. No billboards tho (for now).

Attention is everything. You must wield it. You already cannot afford not to. If you’ve read this far, I have yours, and that’s worth more than you think.