emerging technologies

Getting Stuck on the Ground Floor

“Getting in on the ground floor” may sound enticing. We humans like to be first, best, and on top of things. But just remember that the view is usually better from higher up.


Want content like this in your inbox each week? Leave your email here.

The View from the Top

photo shows a city skyline from the perspective of a rooftop viewfinder

In movies and popular media, there are certain images associated with investors. One of the character tropes is the well-to-do friend racing around in their fancy sports car.

Picture it with us. The car, bright and shiny, has a vanity license plate: it notes the ticker symbol for the holding that made them rich. If the story gives away any more information, it’s that the friend benefitted from a hot tip about a tiny tech company on the brink of striking it big.

Outside of Hollywood, it’s true that some of the most successful investors have done something like this. They happened upon that one hot investment that more than made up for all the mediocre ones. (The bad ones, too, for that matter.) They happened to get in, early.

Clients, we’re seeing newer industries with many possible pathways to growth over the next 7, 14, and 21 years. It’s exciting, but within each of these sectors, there might be dozens of public companies vying to become the next big thing. They all want their ticker on the license plate. The problem is, there is no way to tell—in the moment—which single company it will be.

If a growing industry is going to prove to be important, there’s no harm in waiting for the field to narrow. Time will tell, and so will experience, performance, management, debt, and competition. The companies that aren’t built to last? They’ll be winnowed out soon enough.

The car, the license plate, those aren’t the goal: we believe in investing because it’s getting a piece of the action. It’s providing capital to endeavors we can get behind.

So while getting in on the ground floor sounds enticing, there’s no promise that the building will ever be built—and it’s hard to beat the view from the top.


Want content like this in your inbox each week? Leave your email here.

Play the audio version of this post below:

Constellations and Connectivity

photo shows stars in a galaxy

Life in the 21st century can be grand, huh? We’ve got a few things in our research efforts that are proving quite exciting.

Maybe you’re seeing some of the connections, too?

Of all the news, of all the opportunities available, we’re seeing some common threads—ones that may very well be investable.

Specifically, regarding our tech, our platforms, our power: we’re excited about the potential for faster, more efficient connectivity that could drive future growth in the uses we enjoy from our devices… and then ones we can’t yet imagine!

No recommendations, no guarantees, but… it’s interesting.

New tech is one part of this story. We’re welcoming the latest generation of OLED TVs, smartphone screens that flex and fold, and a form of lighting even more efficient than LED. One company dominates the patents and research and royalties for this stuff.

The second bright spot we’re watching: there’s a social media company (that is not in political trouble and not headed by a controversial billionaire). Per Marketscope Research, its earnings are expected to double each year for the next three. No guarantees, of course.

Another dot: certain sector-leading companies are trading at a discount to the market average valuation. In fields from biopharma to grocery stores, from retail health to food processing, their recent dividends indicate yield between 2 and 3%. Further, it costs $10 billion to build a new semiconductor foundry, and the leading provider of custom chip manufacturing has more than 50% of this growing and vital market. It’s not nothing.

Keep in mind it’s going to take a lot of copper—more than we’ve ever mined before—to build out the next energy revolution. It will include solar and batteries and electric vehicles, and stock in two large miners is still trading well below the levels they reached ten years ago.

Clients, we spend more time and thought than ever before in reading and thinking and researching, trying to sort out investable opportunities to grow wealth in this unfolding future.

We’ll have hits and misses and ups and downs; investing can be volatile. But it sure is fun to try to spot these brightest constellations in the investment universe.

Want to talk about this or anything else? Write or call, any time.


Want content like this in your inbox each week? Leave your email here.

Play the audio version of this post below:

This text is available at https://www.228Main.com/.

That Unimaginable Future

photo shows silver pins interconnected in a network of black string on a white board

As humans, we sometimes have trouble visualizing that which is not yet in existence. Back at the dawn of personal computing, when some were predicting that most homes would eventually have a computer in them, a common question was, “Why would they?”

People just struggled to imagine all the uses that would emerge.

Later, after the wonders of cable television spread across the land, talk of a new kind of communication technology arose—sort of a two-way or interactive television. These earliest visions of the internet were also met with dismissal, as people wondered what good that would be.

The lesson in this history? It may be that we are only ever scratching the surface of the potential capabilities of emerging technologies. There are many things on the horizon: ubiquitous internet access across the globe from low Earth orbit satellites, 5G and 6G and ever-faster connectivity, cloud storage of software and data at ever-decreasing prices, the “internet of things,” virtual reality and augmented reality, electronics in more and more devices… and much more.

The possibilities thrill us.

In our research, we assume that it’s beyond our capacity to foresee all the applications on the way, but we also believe that perhaps their ramifications can be guessed at. For instance…

  • More semiconductors will be needed for more devices.
  • Screens will show up in many new places on many new things, we can reasonably suppose.
  • We can readily imagine that mobile devices will handle increasing amounts of data and apps.
  • Information storage and traffic on mobile could expand exponentially.

So instead of pretending we can predict that unimaginable future, we strive to understand the structure of related industries and how these relationships might develop. Then we determine which established companies may benefit, and we’ll try to identify emerging companies with key technologies.

Then, we sort this out into what is investable, and we manage portfolios in keeping with this background. We don’t predict the future; we imagine some probable possibilities.

Clients, if you have some insight that might help us, or want to talk about this, please email us or call.


Want content like this in your inbox each week? Leave your email here.

Play the audio version of this post below: