There's enough money trading hands in this new economy that talent agencies like Next now have teams dedicated solely to representing Instagram influencers. Jennifer Powell, an L.A-based talent agent, represents some people who advertise products on Instagram.
"When you have a person with 2 million Instagram followers, that's direct consumer advertising. It's a no-brainer," she said.
The Federal Trade Commission requires disclosure in social media when a user is getting paid, but the requirements can be as simple as a person thanking a brand for a product in a caption. CNBC spoke with students at New York University who had mixed reactions, but most were OK with the person they're following getting paid by a brand.
Livingston said his posts have to feel authentic. "I don't ever want to feel like I'm chucking some product," he laughed. "My reader's going to be like, 'Wait a second.'"
—By CNBC's Uptin Saiidi