The Rise of the Adrenaline Economy

Earlier this year, a submersible watercraft carrying five passengers experienced a catastrophic failure while exploring the remnants of the Titanic. The vessel, which was operated by the American tourism company OceanGate, imploded during its descent about 400 nautical miles off the coast of Newfoundland, Canada. Communication was lost during its dive, and authorities were alerted when it failed to resurface at the scheduled time later that day.

I am unfamiliar with OceanGate, the underlying technology, or the safety protocols (or lack thereof) that were in place. So, I won’t place blame on the company or explain the reasons for the submarine’s failure. Instead, I want to discuss a quiet trend that has been developing since the pandemic: the Adrenaline Economy.

The Adrenaline Economy

In the realm of human experience, a spectrum ranges from the serene to the extreme. Some people find their joy by sipping mojitos on the beach, while others seek the thrill of pushing the boundaries of what's physically possible. This spectrum of human experience has given rise to a new economic sector: the Adrenaline Economy, a term coined by Kosner Media to describe the growing industry that facilitates adrenaline-charged experiences.

This industry isn't solely defined by those seeking thrills. It's also shaped by the companies that create, curate, and provide these experiences for the right price. And it takes many forms, ranging from adventure travel - skydiving, bungee jumping, cliff diving - to the most futuristic form of exploration: space.

Democratizing Access

The Adrenaline Economy is not a new phenomenon. Humans have always desired to test their limits from skydiving to swimming with sharks. What is new, however, is the commercialization of this primal instinct. Businesses have emerged to facilitate these adrenaline-charged experiences, creating an industry capitalizing on our desire for thrill and novelty a la Point Break.

The growth of the Adrenaline Economy has been driven by technological innovation and increased disposable income. Commercial space travel was a dream not so long ago, a concept seen only in SciFi movies - it’s a reality for some now. At the same time, rising disposable incomes have given more people the means to pursue these experiences. Markets are resilient, liquidity is plentiful, and pent-up demand among consumer spending has returned to resuscitate the global economy (for the most part).

Jeff Bezos' Blue Origin reportedly auctioned a spot on its inaugural space trip for $28M. Similarly, Sir Richard Branson's Virgin Galactic sells a 90-minute suborbital journey for $450k. The most extravagant package comes from Axiom Space, backed by Alumni Ventures and Helios Capital, offering a 10-day trip to the International Space Station for a whopping $55M.

At first glance, the Adrenaline Economy might seem like a playground for the super-wealthy. After all, a half-million-dollar space joyride is not in the budget for most people. However, that's only part of the story. The democratization of access to thrill-seeking experiences is quietly underway.

Companies like Thrillophilia - an online platform for discovering and booking adventure and experiential travel - have seen a surge in demand. The company has grown its offerings to over 10,000 activities and tours across 125 cities. With the fast-growing iFly, anyone can experience the thrill of free fall in a controlled environment for less than $100.

Soon we won’t have to be in person. Zero Latency, based in Melbourne, Australia, offers free-roam multiplayer VR experiences. Its technology allows up to eight people to explore a virtual world together, with full freedom of movement and no physical restrictions. With Apple and Meta providing the hardware, I expect more startups will bring these experiences to the comfort and safety of our living rooms. Slowly, then all at once.

According to PWC, the size of the experience industry is $150B and growing. Granted this number may be inflated, as it includes concerts, casinos, and theaters. Regardless, it’s a trend worth noting. Until recently, we were passive observers. We marveled at intense sports and adventure, but we're itching to get in the game now. We want to taste victory at the finish line, explore the depths of the unknown, or skydive like Tom Cruise.

It's easy to write off the Adrenaline Economy as frivolous or niche, but that overlooks its core drivers. This goes beyond rich people with too much time and money. It's about changing consumer preferences and the progression of our relationship with risk, novelty, and innovation. Time will tell if old forms of entertainment evolve with them. Or if we can do it in a sustainable and responsible way.

Cheers for reading.