Products of Loneliness.

For decades, investors and investment firms have focused on funding the future of software, social innovations, and physical goods. However, over the past two years, I have been channeling my investments into a different, and perhaps more absurd, area: the lonely sector.

Unlike traditional markets, this sector encompasses the emerging industries designed to address the growing epidemic of loneliness—a phenomenon that I believe will yield the highest returns over the next 20 years.

The number of individuals who have formed a strong enough thesis to act on this is extremely low. The concept of commoditized loneliness is far from a consensus belief, but I am confident in its future. Allow me to take you through the reasoning and evidence that have led me to this unconventional investment thesis.

Denial: The Rise of Social Media

In the early 2000s social media broke into the social atmosphere and formed a tight grasp that nearly no one could escape. Suddenly, the accessibility of your friends and loved ones were a few clicks away. In just a few seconds you could check out what everyone has been up to and view the best of their moments.

It started with MySpace, then Facebook, then WeChat, Youtube, Reddit, Twitter, Tumblr, Instagram, Vine, Snapchat, and now TikTok. The cycle is constant and the attention spans of users shorten every day.

Notably, there's been a few consequences of these platforms, but there are two significant impacts that many have never become consciously aware of:

1. What you, as a user, see of your family and friends is highly manicured. It is not real nor honest. It's the painting of an image that is not representative of reality.
2. The content algorithms serve to you is curated based on your consumption designed precisely to increase and retain the level of engagement you've provided to the advertisers of each platform.

Like a mind virus, the world became more connected than ever before. Yet, people were now more alone than any other time in modern history. The ability to relate to your colleagues has vanished. The images of even those you know, trust, and love are no longer based in any sense of reality. Filters and carefully taken pictures and videos are shared after deliberate management of the public perception generated by the media on hand.

When Facebook hit the base consumption of 2 billion users a shockingly small amount of people had the background to understand the genuine scale of that accomplishment. Ignoring the underlying technology, people were not even capable of understanding the new social dynamics that have surfaced due to global inter-connectivity that can happen in an instant.

The lack of basic knowledge and understanding has enabled myths like the idea that phones and apps listen to you as you speak so they can serve ads has propagated all the way to 2024; a whole 16 years later...

The average user is detached from the base dynamics of these platforms. They're ignorant, willfully.

Anger: Neets

The rise of NEETs (Not in Education, Employment, or Training) is a visceral cry from a generation teetering on the edge. Imagine a vast cohort of young adults, choked by economic stagnation and societal expectations, retreating into the cold, impersonal embrace of the digital void. In Japan alone, over a million NEETs live in a state of suspended animation, disconnected from the physical world.

These individuals find solace in the flickering light of their screens, spending their days in Discord servers, MMO guilds, and Twitch streams. This isn’t just escapism; it’s a full-scale retreat from reality. NEETs are not mere statistics—they are the vanguard of an emerging economic frontier. Companies like Blizzard and Valve, creators of immersive gaming experiences, have turned this isolation into a profitable enterprise. The NEET generation, in their desperate quest for meaning and connection, are unintentionally paving the way for a booming industry built on loneliness.

The allure of digital escapism is potent. Virtual worlds offer a sanctuary from the harshness of reality, a place where individuals can create their own identities and communities. This digital existence, however, deepens their isolation from the real world, creating a cycle of dependency on virtual environments. The longer they stay, the harder it becomes to break free.

From an investment perspective, NEETs present a unique opportunity. These digital hermits are shaping a market driven by their need for engagement and distraction. Companies that cater to their preferences—whether through immersive virtual experiences, niche online communities, or mental health support services—are poised to capture a share of this growing market. The rise of NEETs is not just a social issue; it is a harbinger of a new economic paradigm.

The economic potential of this demographic is vast. Gaming giants like Blizzard and Valve have already tapped into the NEETs’ need for immersive experiences, creating worlds where these individuals can lose themselves. But the opportunity extends beyond gaming. Mental health apps, virtual reality experiences, and online communities all stand to benefit from this growing trend.

Investors who recognize the value of addressing the NEET phenomenon can tap into a market that is both vast and largely untapped. By creating products and services that cater to the unique needs of NEETs, investors can turn a social crisis into a lucrative opportunity. This isn’t just about capitalizing on isolation; it’s about understanding the deep-seated needs of a generation left behind by traditional societal structures.

NEETs symbolize a broader societal alienation, one that offers a stark warning and a lucrative opportunity. The digital sanctuaries they inhabit highlight a market ripe for exploitation—turning isolation into profit. By investing in the NEETs, we can shape a future where digital and economic landscapes converge, transforming societal dysfunction into unprecedented economic growth.

Bargaining: Seeking Parasocial Relationships

In an era where genuine human interaction is increasingly scarce, parasocial relationships—one-sided bonds with media personalities or fictional characters—have become a lifeline for many. These relationships offer a veneer of intimacy, a mirage of connection in a world that feels increasingly disconnected. As social media and entertainment platforms blur the lines between reality and performance, the economic potential of these bonds has exploded.

Social media has transformed the landscape into a multi-billion-dollar industry. Consider the legions of devoted followers cultivated by YouTube and Twitch creators. These fans invest immense time, emotion, and money into their relationships with online personalities, providing financial support through donations, subscriptions, and merchandise purchases. Patreon, for instance, saw creators earning over $1 billion in 2020, a testament to the financial power of parasocial relationships.

The idol industry in Japan takes this phenomenon to its extreme. Idols craft meticulously managed public personas, fostering intense devotion among fans who spend exorbitantly on concerts, merchandise, and exclusive interactions. These parasocial bonds, although one-sided, wield enormous economic influence.

Now, look at Taylor Swift. Her “Eras Tour” isn’t just a series of concerts; it’s an economic juggernaut that revitalizes local economies. Hotels, restaurants, and businesses in tour cities experience a financial windfall as her army of fans descends. This isn’t mere fandom—it’s a testament to the economic might of parasocial relationships. Swift’s ability to mobilize her fanbase into significant economic activity showcases the deep, albeit one-sided, connections she fosters.

The implications for investors are profound. Platforms that facilitate parasocial interactions aren’t merely about entertainment; they’re about monetizing emotional desperation. The willingness of fans to invest in these relationships underscores a lucrative market ripe for exploitation.

Parasocial relationships fulfill a deep-seated need for connection and belonging in an increasingly isolated world. As digital platforms continue to evolve, the potential for these relationships to generate significant economic returns will only grow. Investors who understand the value of emotional engagement and the human need for connection can tap into a goldmine, transforming digital affection into substantial profits.

By recognizing the power of parasocial relationships, we acknowledge a profound shift in how people seek connection. This isn’t just about leveraging a trend; it’s about understanding the fundamental changes in human interaction and capitalizing on them. In a world where genuine connection is rare, those who can provide even the illusion of it will find themselves at the forefront of a new economic frontier.

Depression: The Desolation of Loneliness

The COVID-19 pandemic did more than just upend our daily routines; it laid bare the fragile threads of our social fabric. As lockdowns confined us to our homes and social distancing became the new normal, the epidemic of loneliness surged to unprecedented levels. The sudden, forced isolation magnified an already growing issue, turning it into a full-blown crisis.

Remote work, initially hailed as a beacon of flexibility and freedom, quickly morphed into a double-edged sword. The dissolution of the traditional office environment eradicated spontaneous interactions—the casual chats over coffee, the impromptu brainstorming sessions, the simple human connection that office life provided. Instead, workers were left staring at screens, their interactions reduced to scheduled Zoom meetings and sterile email exchanges.

A 2020 Buffer study highlighted this stark reality: 20% of remote workers identified loneliness as their primary struggle. The physical separation from colleagues deepened the chasm of isolation, leaving many feeling cut off from their professional and social networks. This isn’t just a fleeting sadness; it’s a pervasive, gnawing desolation that has profound implications for mental health.

The financial toll is staggering. In 2019, U.S. mental health care expenditures reached $225 billion, much of it directed towards treating loneliness-related conditions like anxiety and depression. The pandemic has only exacerbated this financial burden, as more people seek help for mental health issues intensified by prolonged isolation.

Enter digital solutions. Teletherapy and mental health apps like BetterHelp and Talkspace have seen a surge in users, reflecting a societal shift towards digital mental health services. These platforms have become essential lifelines, providing accessible support to those grappling with loneliness. The global telehealth market, valued at $41.4 billion in 2019, is projected to grow at a compound annual growth rate (CAGR) of 15.1% from 2020 to 2027. This surge underscores the immense investment opportunities in combating loneliness through technology.

We live in an age where we are perpetually connected yet profoundly alone. The traditional office, a space for spontaneous interactions and camaraderie, has morphed into a series of Zoom calls and Slack messages. The human element is fading, replaced by pixels and muted microphones. This isn’t just about feeling sad; it’s a public health crisis. Digital solutions are not a luxury—they’re a lifeline.

The desolation of loneliness has reshaped our world, creating a landscape where the need for connection has never been greater. As investors, recognizing and addressing this need isn’t just an opportunity—it’s a necessity. By investing in technologies and services that combat loneliness, we can transform this crisis into an unprecedented opportunity for connection and profit.

Acceptance: A Penny for Your Love

The commodification of loneliness is starkly evident in platforms like OnlyFans and the idol industry. These platforms have perfected the art of monetizing emotional need, turning the deep-seated human desire for connection into a lucrative business model.

OnlyFans is a prime example. It allows content creators to sell personalized experiences and interactions to subscribers, creating an illusion of intimacy and connection. This platform has exploded in popularity, with over 170 million registered users and 1.5 million content creators as of 2023. Users are willing to pay a premium for a taste of personalized attention, whether through direct messages, custom videos, or live interactions. This is not just a financial transaction; it’s an emotional one.

In Japan, the idol industry epitomizes this trend. Idols meticulously craft their public personas to foster intense fan devotion. These idols interact with fans through a variety of mediums—handshake events, exclusive fan club memberships, personalized video messages. Fans spend exorbitantly on merchandise, concert tickets, and any form of interaction that brings them closer to their idols. These transactions, while commercially driven, fulfill a deep emotional void.

Consider the economic might of these industries. The success of OnlyFans and the idol industry underscores the financial viability of monetizing loneliness. This isn’t just about profit; it’s about creating new paradigms of connection in an increasingly disconnected world. Fans are not just buying a product; they are buying a piece of an experience, a moment of perceived closeness that is otherwise missing from their lives.

The economic potential of these loneliness-driven markets is staggering. Platforms that facilitate parasocial relationships and personalized interactions are on the rise, and their success highlights the immense demand for emotional engagement. As traditional social structures continue to erode, the need for these manufactured connections will only grow.

Investors who recognize the power of these platforms are tapping into a goldmine. By understanding and leveraging the human need for connection, they can capitalize on a market that transforms emotional desperation into financial opportunity. This is not merely about exploiting loneliness; it’s about recognizing a fundamental shift in how people seek and maintain connections in a digital age.

In a world where genuine connection is increasingly rare, the ability to provide even the illusion of intimacy becomes incredibly valuable. Platforms like OnlyFans and the idol industry are at the forefront of this new economic frontier, turning the deep-seated human need for love and connection into a profitable enterprise. This isn’t just a fleeting trend; it’s a glimpse into the future of human interaction and its economic potential. By investing in these industries, we are not just supporting a business model; we are acknowledging and capitalizing on the profound changes in how people connect in the modern world.

Relapse: Human Escape

As technology advances, AI-driven solutions are emerging as the next frontier in addressing loneliness. Imagine a world where your closest confidant is an AI companion, offering customized interactions and companionship. This isn’t science fiction; it’s our imminent reality.

AI companions are designed to fill the emotional void left by the absence of human interaction, offering a sense of presence and support. Companies like Replika and Gatebox are pioneering this space, creating AI-driven solutions that cater to our deepest emotional needs.

Replika, an AI chatbot, provides users with personalized conversations and emotional support, simulating a close friendship. Users can talk to Replika about their day, share their thoughts and feelings, and receive responses that are tailored to their individual personalities and needs. The AI learns and adapts over time, creating a relationship that feels increasingly personal and intimate.

Gatebox, a Japanese company, has developed an AI hologram assistant that goes even further. This AI companion, projected as a hologram, can interact with users in real-time, provide companionship, and assist with daily tasks. Imagine coming home to a digital entity that greets you, asks about your day, and offers support and encouragement. This isn’t just a gadget; it’s a lifeline for those who feel isolated and alone.

The market for AI-driven companionship is poised for explosive growth. The global conversational AI market, projected to grow from 4.2 billion dollars in 2019 to 15.7 billion by 2024, reflects the increasing demand for AI solutions that address loneliness. This rapid expansion highlights the potential for investors to capitalize on the intersection of technology and emotional fulfillment.

But the implications go beyond mere market potential. AI companions represent a fundamental shift in how we perceive and fulfill our emotional needs. As traditional social structures continue to erode, and as more people find themselves isolated by the demands of modern life, the appeal of AI companionship will only grow stronger.

Investors who recognize the transformative potential of AI companions are tapping into a profound and growing need. By investing in AI-driven solutions, they are not just supporting a new technology; they are shaping the future of human interaction. This isn’t merely about mitigating loneliness; it’s about redefining what it means to connect and how those connections can be cultivated and maintained in a digital age.

The human escape into AI companionship is not just an escape from reality; it’s a new reality in itself. As the lines between human and artificial blur, the ways we seek and maintain connections will continue to evolve. Those who invest in this space are not just capitalizing on a trend; they are participating in the creation of a new paradigm of emotional engagement and support.

In a world where traditional forms of connection are increasingly out of reach, AI companions offer a revolutionary solution. They provide not just a stopgap, but a fundamentally new way to address the deep-seated human need for companionship and support. This is the future of human interaction, and it offers unparalleled opportunities for those bold enough to embrace it. By investing in AI companions, we are not just investing in technology; we are investing in the future of human emotional fulfillment.

Conclusion: Loneliness as an Economic Frontier

As we navigate through the digital age, it becomes increasingly clear that loneliness is more than just a social issue—it is a profound economic opportunity. The NEETs, isolated in their digital sanctuaries, the millions seeking parasocial relationships, the desolate cry of those trapped in remote work, the monetization of intimacy through platforms like OnlyFans, and the burgeoning market for AI companions all underscore this reality.

We are witnessing the emergence of an industry built on loneliness. Each facet, from the immersive escapism of NEETs to the economic juggernaut of parasocial fandoms, reveals a market ripe for innovation and investment. The digital age, with all its connectivity, has paradoxically deepened our sense of isolation, creating a vast demand for solutions that offer genuine or even simulated connection.

In this landscape, investors who recognize the potential of addressing loneliness are not just tapping into a profitable market—they are positioning themselves at the forefront of a fundamental shift in human interaction. The intersection of technology and emotional fulfillment offers unparalleled opportunities for growth and impact. By investing in these emerging markets, we can transform a widespread crisis into a powerful engine for economic and social development.

The future of human connection is being rewritten. As traditional social structures continue to erode, the demand for products and services that address loneliness will only grow. This is not merely about exploiting a trend; it is about understanding and responding to a deep, pervasive human need. Loneliness, in all its forms, is an incredibly interesting and potential-filled avenue for those bold enough to venture into this new frontier.

By recognizing the profound changes in how we seek and maintain connections, we can harness the economic potential of loneliness. This isn’t just about making a profit; it’s about shaping the future of human interaction. The opportunities are vast, the implications profound. In addressing loneliness, we are not merely investing in a market; we are investing in the very fabric of human connection and emotional fulfillment. This is the dawn of a new era, where the business of loneliness becomes a cornerstone of the digital economy, promising substantial returns for those who dare to innovate and invest in the human experience.