Editor’s Note: Today we’re sharing the first installment of 25-year tech expert Jeff Brown’s two-part essay series about massive investment opportunities available today. You won’t want to miss this…
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From Jeff Brown, editor, Exponential Tech Investor: Imagine it’s 1990…
Only this time, you know how the Internet and cell phone communication will literally “reorder” the world.
Instead of having a vague idea of what these new ideas mean… you have specific knowledge of how they will create vast new trillion-dollar industries… while demolishing old ones.
If you knew all that, what money moves would you make before these things transformed how we work and live?
You might buy Cisco, the world’s leading maker of networking gear… which is the “plumbing” the Internet needs to function.
You could buy $1,000 worth of Cisco stock after its IPO. Less than 10 years later, that small stake would be worth $1,264,000 (a 1,264 fold return).
Or you might buy Dell, which became a hugely popular computer maker.
Just $5,000 placed into Dell stock in the early 90s would have grown into $4.5 million (a more than 90,000% gain).
You might also buy Microsoft, which made the world’s most popular computer software. The stock gained 9,556% during the 1990s.
Just think of it… an investment of just $1,000 or $5,000 turning into millions of dollars.
It’s the kind of investment that can take care of your family for the rest of your lives. It can allow you to buy cars… vacations… and just about anything else you want.
Those kinds of investment gains are possible when you invest in technology that completely changes the world.
The bigger the change, the bigger the gains.
Knowing all this is extremely important right now.
We’re on the verge of a transformation very similar to what we saw in the 1990s.
As you read this, there are a handful of early-stage technologies in use that will reshape our world the way the Internet did in the 1990s… and the way the automobile did in the early 20th century.
Investors stand to make gains similar—possibly even larger—than those made during the Internet boom.
In the next few years, you’ll be able to buy a small subset of investments that are a lock to soar more than 10,000% over the coming years.
If you know what’s about to happen, you’ll look back at today with an elevated perspective that maybe one person in 10 million ever attains.
Instead of looking back at this time with regret and knowing you “missed out,” you’ll look back with satisfaction and fond memories. It was when you laid the first stone of your family’s financial dynasty.
The investments you make over the next few years can secure your financial freedom for the rest of your life.
What’s coming is that big… and that important.
It all starts with the Law of Accelerating Returns.
Why Everything Is About to Change… And Make Some People Obscenely Wealthy
Over the next 10 years, we’ll see more change to the economy than we’ve seen in the past 40 years.
The way we work, shop, sleep, travel, bank, and receive health care will look completely different than they look now.
Amazing new industries will spring up at a pace we’ve never seen. Those new industries will demolish old ones at the same breakneck pace.
If you’re on the right side of these changes, you’re virtually guaranteed to make a fortune. If you’re on the wrong side of them, you’ll lose your job and the value of your investment portfolio will vanish.
Although we’ve seen radical changes in technology over the past 40 years, these improvements are relatively small. They are incremental.
We’re on the cusp of much, much larger changes.
What’s coming is not incremental. It is exponential.
The term “exponential” might sound complicated. But it’s actually very easy to understand. You simply have to think back to one of the most common sayings in America.
You’ve heard the saying “breeding like rabbits.”
This is usually illustrated with an example.
You have two rabbits. Those two rabbits breed and now you have four rabbits. Those four rabbits breed and you have eight rabbits. Those eight rabbits breed and you have 16 rabbits.
The rate of increase gets larger with each stage. The later stages represent awesome amounts of growth.
In just 10 breeding stages, you get an astounding 2,048 rabbits. And the final stage represents a 512-fold gain over the original number.
This is what we call “exponential growth.”
Exponential growth is in contrast to something called “linear growth.”
Linear growth is when something advances or grows at a more conventional pace.
For example, if those two rabbits started breeding and added one rabbit per cycle, that’s linear growth.
With linear growth, you get just 12 rabbits after 10 breeding stages.
Knowing the difference between linear growth and exponential growth can literally make you millions of dollars over the coming years.
When a very low number grows at an exponential rate, the initial progress isn’t striking. The growth plotted on a chart doesn’t soar upwards during the early stages.
The truly awesome growth happens at a specific “tipping point” in time… where the exponential growth makes things change at an incredible rate. This tipping point is the “elbow” you see on the chart below:
Over the last 40 years, advancements in computing power, computer memory, storage capacity, telecommunication bandwidth capacity, and other aspects of digital gear have followed a path like you see on the left side of the chart. After all, these technologies were brand new. They started from extremely low levels.
But after years of advancing at exponential rates, everything I just described is entering the “elbow”… the rocket ship phase.
We’re about to see stunning advancements in technology that will dwarf those made in previous decades. Computing power is advancing at lightning speeds now. Conversely, the cost of computing power is plummeting.
For example, in 1996, the $55 million ASCI Red Supercomputer was the first computer to reach the speed of 1 Teraflop. It occupied a footprint nearly the size of a tennis court.
In 2014, Sony released its PlayStation 4 video game console. It has almost twice the computational power as ASCI Red… and it costs 100,000 times less. It could fit in a small backpack.
This single example shows you that…
Our computers are getting much faster, much better, much smaller, and much cheaper.
This has radical implications for our economy.
As much as computers and advanced telecommunications have changed our world since the 1990s, they are about to change it a whole lot more.
Computing power is the foundation on which our amazing world of technological progress rests on.
Improvements in computing power:
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Make medical implants smaller and better
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Make it possible for you to take high quality pictures with your phone
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Allow amazing “apps” like Uber to transform the way we travel
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Have slashed the cost of solar and wind power
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Allow you to check email on your smartphone while waiting in line
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Make it so you can use Wi-Fi on your computer almost anywhere
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Make it possible for Tesla to build high-quality electric cars
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Enable self-driving cars.
This is a very, very important point, so let’s cover it again…
Advancements in computing power are the wellspring from which other technological progress flows.
Computer power is now entering the “rocket ship” stage of advancement. It is exploding in power and speed.
And those on the right side of the changes will build fortunes faster than at any time in history.
Those on the wrong side of the changes will lose their fortunes faster than at any time in history.
Over the last few decades, it took on average about 20 years for the typical Fortune 500 company to reach a market capitalization of $1 billion.
In 1998, Google was able to reach $1 billion in market cap in only eight years, which was considered fast at the time.
By 2004, Facebook had done it in five years.
By 2009, Uber had done it in less than three years.
In 2012, virtual-reality firm Oculus Rift did it in just over a year.
And as recently as 2014, a workplace productivity company called Slack pulled it off in eight months.
The chart below displays the amount of time it took for companies to hit a billion-dollar market cap.
As you can see, it’s taking less time to generate incredible wealth. Investors are reaping the benefits. Facebook shareholders who bought at the IPO enjoyed a 200% return on their investment in just four years.
And they’re the laggards. Tesla shareholders are up 1,320%. Google shareholders are up 1,479%.
With this simple example, you can see how the time it takes for major economic change is getting “compressed.” Industries are being transformed in a short time.
This has both positive and negative implications…
You’ve seen the positive. Investments in the right technology can easily climb 1,000% and beyond. The time it takes to earn giant returns has never been shorter.
But just as fast as these companies create positive change, “old” industries are demolished in the process.
As Uber soared to a billion-dollar valuation, the old taxi industry was devastated. It lost hundreds of millions in annual revenue.
As Apple’s iPhone dominated the phone market, the loser in the game, Blackberry, saw its share price plummet more than 90%.
These massive industry shifts used to take 20-plus years to happen. Now, they are happening in less than five years. The rate of change is speeding up.
For another perspective on how quickly things are changing, have a look at the chart below. It shows how the average company lifespan in the benchmark S&P 500 stock index is plummeting.
The S&P 500 is a “who’s who” of corporate America. It tracks 500 of America’s largest, most successful companies.
The average “tenure” in the S&P has declined from 61 years in 1958 to just 18 years in 2015. The time it takes to create and demolish industries is being compressed. Technology is playing a major role.
The world is changing faster than ever. The rate of change is only going to get faster. New winners are being created faster than ever. And many of today’s “dominant” companies could very easily be tomorrow’s losers.
So what should you do as an investor?
Well, obviously, you don’t want to be in the taxi business. You don’t want a job doing menial office work that a robot could easily replace. But there’s a lot more for us to figure out.
In part two of this essay, I’ll detail why a large group of America’s most innovative companies are about to go public… and offer us the investment opportunity of a lifetime.
Reeves’ Note: Jeff’s launched a free online training series to explain why there’s a huge change coming to the stock market… one that could send shares of “safe” blue chips like Apple and Microsoft plummeting.
But there are some good—and potentially profitable—ways to prepare for it. So make sure you don’t miss out. Click here to register for free instant access.
And look out for the second installment of Jeff’s essay in next weekend’s Palm Beach Daily…