The Elevator Economy
Everyone agrees we are in a K-shaped economy. Self-improving AI is the dividing line. Some people are going up. Everyone else is going down. There is no standing still.
I go further than K-shaped. I think we are in the elevator economy for the first time in human history. The gap between the people ascending and the people falling is not widening gradually. It is accelerating. Every month the elevator moves faster. The people on it are pulling away at a rate that has no precedent.
By the end of 2026, there will be billion-dollar businesses that are effectively self-running. No human in the day-to-day operations. AI handling execution, customer service, logistics, code, content, analysis. A founder with imagination and the right AI systems, generating more economic value than companies with thousands of employees did five years ago. That is the elevator economy. That is what is happening right now.
The people going up are not necessarily smarter. They are not necessarily harder working. They are the ones who figured out that AI changes what is valuable. When a machine can execute, execution stops being the scarce resource. What becomes scarce is the ability to imagine what should be built, and the trustworthiness to be given the keys to build it.
The imagination economy is what emerges on the up side. An economy where your imagination, backed by AI leverage and the right team, is the primary asset.
Why Execution Is No Longer the Moat
For decades, the economy rewarded execution speed. Who could ship fastest. Who could grind hardest. Who could scale the most efficient operation. That world made sense when execution was expensive and slow.
AI collapsed the cost of execution. Writing code, drafting documents, analyzing data, generating designs, researching markets. All of it is approaching zero marginal cost. The things that used to take a team of ten and six months now take one person and a weekend.
And it means the bottleneck has moved. It is no longer "can we build this?" It is "should we build this? What should it look like? Who is it for? What does it mean?"
Those are imagination questions. And imagination cannot be automated.
The Value Hierarchy
In the imagination economy, where you sit on this hierarchy determines your value:
Level 0: Spectator. You watch the game. You read about AI, attend talks, consume newsletters. But you are not in the arena. Information without application is entertainment, not preparation.
Level 1: Player. You are in the game. You execute within existing systems, using AI as a tool to move faster. You might be elite at it. But your value is measured by output, and AI is compressing this level every quarter.
Level 2: Coach. You design the system that players operate within. You are not editing videos; you are building the editing pipeline. This is meta-work: working on the business, not in it. Your value is measured by the performance of the system you design.
Level 3: Game Creator. You invent new games. Not better versions of existing businesses, but new categories of value creation. You combine domain expertise, AI leverage, and vision to enable possibilities that did not exist before.
Level 4: Game Engine Creator. You build the engine that powers many games. The methodology, the infrastructure, the enabling layer. Every game built on your engine creates value that flows back to you.
AI is compressing Levels 0 and 1 toward zero. This is not dystopian. It is liberating. The compression frees human energy for coaching, game creation, and engine building. The question is not whether the shift is happening. It is whether you are climbing.
Heartshare Over Mindshare
The attention economy is dying. Good.
For two decades, the game was mindshare. Hijack attention. Hack the algorithm. Manufacture engagement. It worked because the internet was still mostly real people saying real things.
That world is over. The feed is filling with synthetic content, synthetic engagement, synthetic people. When you cannot tell what is real, mindshare stops meaning anything. You can capture a million eyeballs and none of them trust you.
In the imagination economy, the currency is not attention. It is trust. Heartshare.
Mindshare was about how many people knew your name. Heartshare is about how many people would hand you the keys to their business and sleep well that night.
You cannot hack heartshare. You cannot growth-hack your way into someone's trust. You earn it the slow way: by being the person who shows up, who keeps their word, who builds things that actually work, who treats other people's data like it is sacred.
As the noise gets louder, as synthetic content floods every channel, people will build with people they trust. Not the loudest voice. Not the best ad. The person whose character they believe in.
How Industries Get Born
Here is the sequence that creates new industries in the imagination economy:
- New technology enables new possibilities (AI making previously impossible things possible)
- Someone with domain expertise and calling reimagines the industry from first principles
- Infrastructure gets built to support the new vision
- Businesses form on top of the infrastructure
- New roles emerge that did not exist before
- People get educated and activated into those roles
Every industry as we know it is about to be reinvented. Music, education, media, healthcare, finance. The power structures, the technology, the level of consciousness. All shifting. That means new infrastructure. New businesses. New roles that do not exist yet.
The people who will thrive are not the ones waiting for someone to hand them a job description. They are the ones imagining what the new roles look like and building toward them.
Imagination Without Heart Is Just Cleverness
And cleverness is cheap now. AI can be clever. AI can optimize. AI can calculate.
What AI cannot do is discern who to trust. What AI cannot do is feel whether someone is real. What AI cannot do is know, in your bones, that this is the person to bet on.
That knowing is your edge. That is the thing that gets more valuable, not less, as AI gets more powerful. The companies that will define the next era will not just be AI-powered. They will be led by people whose character precedes their pitch deck. Whose reputation is their distribution. Whose integrity is their growth strategy.
The attention economy rewarded the loudest. The imagination economy rewards the most trusted.
Where This Is Happening
In my experience, Austin is where a disproportionate number of these configurations are being created right now. The right people, the right energy, the right combination of technical depth and human warmth. The imagination economy is not evenly distributed. It is clustering in places where trust is high, ego is low, and builders actually like each other.
If you want to see what the imagination economy looks like in practice, come to Austin.