A Free Market for Eyeballs - Neel Somani's Blog

I have a friend who blew up on Twitter/X a few years ago. His account started like mine, just a couple thousand followers, mostly his friends. But by the end of the year, he had so many viral tweets that he was at 100K+.

I brought this up to my mom, a first-generation immigrant. She said, "So? What has he gotten out of that?" I remember thinking that she was completely out-of-touch, but I had no strong argument to defend my intuition.

Since then, this kid has met billionaires like Sam Altman, Elon Musk; he's working at a top company making 7-figures per year; and he manages a small fund on the side.

I think this anecdote says a lot about Twitter and why exactly it's valuable. I used to work at a hedge fund, so I'm cursed to always think in finance terms. To me, posting on Twitter is a form of regulatory arbitrage, because attention is capital that isn't taxed.

Finance moguls often preach about the "Section 1031 exchange," a tax feature that allows you to repeatedly swap your investment properties for more valuable ones, and continuously defer capital gains tax. What I've observed is that the same phenomenon happens with attention on Twitter.

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