Earlier this month, after successfully finalizing the inaugural round of funding for his fledgling artificial intelligence startup, Natural, founder Kahlil Lalji found himself contemplating how best to allocate his newly secured capital. Among his first ambitions was to immerse himself in what has become an almost ceremonial milestone for technology entrepreneurs in the Bay Area: the purchase of a billboard somewhere within the competitive marketing landscape of San Francisco. However, Lalji quickly discovered that enthusiasm alone would not suffice. When he attempted to rent billboard space, he encountered a reality of surprising scarcity — a waiting period spanning from six to nine months was the norm. Even more daunting, when he inquired about the coveted placements near Y Combinator’s outposts in Dogpatch and Jackson Square — neighborhoods densely populated by ambitious startups — he learned that every prime display had already been claimed well into 2026, with no indications of availability beyond that year.
For decades, the highways threading through the Bay Area, particularly Interstates 280 and 101, have featured billboards that juxtapose low-tech advertising with high-tech aspirations. Yet in recent months, their popularity has surged dramatically. The frenetic pace of the AI boom has spurred a wave of well-capitalized startups eager to stand out in an increasingly crowded field. In parallel, marketing strategies traditionally reserved for consumer brands are now being adopted by enterprise-focused firms, creating a hybrid approach that places equal emphasis on visibility, memorability, and cultural presence. Meanwhile, the city itself — long viewed as an emblem of innovation — has experienced a renaissance after years of slowdown: apartments, offices, and, notably, billboard space have all returned to being scarce, sought-after assets.
Keith Messick, the chief marketing officer of Vercel, observed this phenomenon with a blend of amusement and admiration. He quipped that, apart from manufacturing advanced chips for AI systems, the most profitable business at this moment might be selling billboards to AI companies. In his words, the San Francisco billboard market has become “hypercompetitive” — a term that captures both the intensity of demand and the remarkable willingness of startups to invest heavily in physical advertising.
Only a short time ago, the dynamics were strikingly different. Two years earlier, Messick recalled receiving frequent calls from billboard companies offering discounted rates — so-called remnant inventory that advertisers could acquire at cut prices whenever a sign went unrented. But that balance of power has quite literally flipped. Now, in the rare instance when a billboard becomes available, he receives urgent calls demanding immediate decisions and premium payments. Often, he has less than a day — sometimes only hours — to commit before another bidder claims the space. This frantic atmosphere has prompted many companies to adopt a strategy of “hoarding” — securing billboard contracts far in advance to avoid being locked out of future opportunities. As Messick explained, once a firm surrenders a valuable billboard, there is no guarantee it will ever obtain another.
Such extraordinary demand has even been reflected in corporate financial reports. Clear Channel Outdoor, one of the largest outdoor advertising firms in the world, recently acknowledged that San Francisco has become a primary engine of its revenue growth within the United States. The city’s outdoor marketing sector, once considered a relic of pre-digital advertising, has thus reemerged as a lucrative frontier.
According to Heather MacKinnon, head of brand at the fintech platform Mercury — which specializes in banking services tailored to startups — billboard rental rates in San Francisco vary widely, but certain prime zones could experience price increases of up to 40% within the next year. She attributed this escalation not only to the influx of AI companies vying for exposure, but also to the city’s upcoming role as host to major global spectacles: the Super Bowl and the World Cup. The scale of those events, MacKinnon explained, has compelled larger, well-established brands to secure advertising space far in advance, further constricting availability for local technology firms. Clear Channel and its major competitor, Outfront Media, declined to release specific pricing data. Yet Outfront’s sales director, Michael Marvin, offered a succinct explanation: their entire business revolves around supply and demand. In his words, virtually every billboard considered “prime inventory” — particularly the sought-after stretch between the San Francisco International Airport and downtown — is already sold out for the foreseeable year.
Interestingly, this newfound obsession with outdoor advertising has given the Bay Area a sense of déjà vu. The current marketing environment, some observers argue, seems to have regressed to an earlier era, one in which physical presence mattered as much as digital engagement. Despite the city’s deep technological sophistication, many residents would struggle to differentiate between Vanta, a company focused on security compliance, and Vercel, which offers developer tools and web infrastructure solutions. Yet both firms, each valued in the billions, have leaned heavily on witty, stylized billboards to amplify brand awareness. Vanta’s campaign — featuring humorous taglines referencing technical certifications such as SOC 2 — succeeded precisely because it sparked conversation and intrigue. As early investor Terrence Rohan remarked, the brilliance of such advertising lies not in universal comprehension but in its memorability. Cleverness, when executed effectively, translates directly into brand equity.
The timing of this trend coincides with a staggering influx of venture capital funding into the AI startup ecosystem. Data from Crunchbase indicates that investors poured nearly $36 billion into AI ventures in a single quarter. For venture capitalists like Anthony Heckman of Abstract VC, this avalanche of investment underscores the critical importance of differentiation. In an environment oversaturated with ambitious newcomers, branding has evolved from an optional luxury into a competitive necessity. According to Heckman, a well-designed billboard — one that encapsulates a company’s ethos in a moment’s glance — can constitute an invaluable instrument for standing out. Vercel, for example, has opted for simplicity and symbolism in its signage, displaying a line of computer code that simultaneously resonates with developers and asserts technical sophistication.
Messick elaborated that this shift blurs the line between enterprise and consumer marketing. Even companies selling complex, seemingly “boring” products are now prioritizing attention-grabbing aesthetics and emotional appeal. Billboards, he argued, act as reinforcement mechanisms: their physicality conveys a tacit message of success. When people see a company’s name plastered across the city skyline, they subconsciously infer that the firm is thriving. This perception can yield tangible advantages — particularly in recruitment. Ray Wu, managing partner at Alumni Ventures, noted that AI companies are now aggressively competing for top-tier engineers and researchers concentrated in the Bay Area. An impressive physical presence, he observed, helps legitimize a startup in the eyes of both potential employees and investors. In essence, it broadcasts confidence.
While titans like Vanta and Vercel enjoy established recognition, Natural — Lalji’s nascent venture developing payment infrastructure tailored for AI-powered agents — remains barely three months old. Yet even at this early stage, Lalji believes the investment is justifiable. He estimates that spending $250,000 on billboard campaigns would pay for itself if it succeeded in attracting roughly one hundred paying customers. Given the high lifetime value of each client within the payments industry, those numbers, he argued, make rational business sense when analyzed over time.
Nevertheless, as MacKinnon of Mercury pointed out, purchasing billboard space is only the beginning. The true challenge lies in designing content distinctive enough to cut through what she described as visual monotony. Driving along the Skyway — a raised portion of Highway 80 that slices across downtown San Francisco — she has noticed a repetitive sea of minimalist black-and-white billboards, most bearing vague allusions to artificial intelligence. In her assessment, these indistinguishable ads contribute little beyond fleeting satisfaction for the founders who pass them daily. Unless integrated into a broader, cohesive marketing strategy, even the most expensive sign risks fading into the background.
To some analysts, the proliferation of AI-related billboards represents more than a marketing fad; it is symptomatic of a larger, speculative exuberance verging on an AI bubble. Foundation Capital’s general partner, Ashu Garg, offered a wry observation: if a clever billboard provokes meaningful discussions and attracts real opportunities, then its expense is justified. But if it fails to generate engagement, then the founders have simply paid handsomely for what amounts to a giant, public selfie — an attempt to project confidence rather than achieve substance.
Sourse: https://www.businessinsider.com/the-insane-competition-for-sfs-most-competitive-real-estate-2025-11
