Chip, a former data scientist at Elon Musk's space giant SpaceX, who owns about $3,5 million worth of shares in the company, recently bought $10.000 worth of meteorites and a $5.000 fire truck.
The 50-year-old space enthusiast is not sure how he will use the truck, perhaps as a birthday present for his 3-year-old child. But new wealth linked to SpaceX's initial public offering in June has given him the freedom to buy "silly" things, he told Reuters.
Chip, who asked that only his first name be used so he can discuss personal finances, is considering buying a TAG Heuer Carrera Calibre 1887 SpaceX Chronograph watch, in the price range of about $8.000, inspired by NASA astronaut John Glenn's 1962 mission to Earth orbit.
Despite the excitement, it remains an open question whether the estimated 440.000 American millionaires, created by last year's stock market gains and, more recently, the IPOs of AI companies, will usher in a new golden age for the global luxury goods sector.
“This industry is increasingly competing with other industries,” Federica Levato, a partner at consulting firm Bain & Company, told Reuters.
Struggling fashion brands are looking to the boom of tech millionaires as a possible salvation as they grapple with persistent weakness in China and global consumer uncertainty.
The personal luxury goods market, estimated at 358 billion euros in 2025, has been shrinking over the past two years, Bain said in a study published last month.
Still, North America was among the fastest-growing regions for luxury groups LVMH, Richemont and Hermès, as well as Gucci, which operates within Kering, in the quarter ending March 31.
Richmon CEO Nikola Bos told analysts in May that “high levels of consumer confidence in America” had translated into strong sales.
Specific taste
As they try to sell products to new tech millionaires, brands must reckon with their specific tastes and competing interests that distract from traditional luxury items.
“I played volleyball in high school and college,” AI strategist Zak Kass, who until 2023 led the go-to-market unit at OpenAI, the maker of ChatGPT, and owns an undisclosed stake in SpaceX, told Reuters. “I literally took the profits from OpenAI and bought a professional volleyball team,” he said.
As part of a broader focus on experiences and health, tech workers are interested in smartwatches that track daily steps and calories, said Harrison Colcord, founder of Harrison Lifestyle Concierge.
Former SpaceX engineer Robert, whose shares are worth about $4 million and who also asked that only his name be used, said he and his wife recently bought new Apple Watches as they increasingly turn to fitness, while they plan to reinvest most of their new wealth after a cruise around Alaska.
However, the opportunity still exists for traditional watches from top brands worth thousands of dollars, including Rolex and Cartier from the Richemont group, partly because of their appeal as an investment, as their resale price is often higher than retail.
“You won’t wear a smartwatch with a tuxedo or a suit,” Kolkord said.
Clothing brands, however, will also have to compete with other industries, beyond traditional luxury, for their share of consumption.
The nouveau riche spend about a third less on elegant clothes and leather goods compared to those with generational wealth, Filippo Bianchi, who leads the global luxury team at Boston Consulting Group, told the British agency.
Instead, their main spending priority is on durable assets, such as real estate, yachts and cars, he said.
Still, brands like Chanel and Hermès carry logos that wealthy clients are often willing to wear, said Mary Gonsalves Keene, a California-based stylist who works with tech executives.
Chip, a former SpaceX employee, said he has no plans to buy luxury clothing, except to possibly upgrade his outdoor clothing collection. He bought his last jacket at a second-hand Goodwill store.
"I've been wearing T-shirts and shorts for years," he said. "I feel comfortable in that - I don't see that changing."
See more:
Download the app and follow the news
FOLLOW US ON
