About once every decade, a major event takes place in the technology sector...
And that single event is so powerful, it’s responsible for the vast majority of that sector’s investment gains for years afterward.
Today, I’ll tell you everything you need to know about these events...
Including when the next one is set to take place — and most importantly, how you can profit from it.
“Innovation Cycles”
According to the economist John Mauldin, for the past 200 years, a major event has taken place roughly once every decade.
He calls this event an innovation cycle.
Each cycle is marked by the introduction of a world-changing new invention.
Beginning with the cotton gin in 1793, and most recently with the launch of the iPhone in 2007, these innovations alter the lives of billions of people — and when they do, they unleash a wave of wealth and profits.
For instance, after Microsoft kicked off the PC revolution in 1985 with its Windows operating system, its stock price soared by roughly 5,650% in ten years…
That’s enough to turn every $10,000 you invested into more than $560,000.
The next cycle was the World Wide Web in the 90s, and then the iPhone in the mid 2000s.
Time and again, Mauldin’s “innovation cycle” theory has been accurate. And for investors like us, it’s proven to be very useful when looking for new investments.
Simply put, if you know where to put your money when the next cycle is kicking in, you can earn a fortune.
And that’s why I’m writing this essay today...
You see, after 11 years, we believe we just entered a new innovation cycle.
And this time around, investors like you have the chance to earn more money than you ever could before. Let me explain...
Where the Real Profits Are
As I showed you a moment ago, when a company like Microsoft launches a world-changing product, investors can earn a great deal of money.
The thing is, innovation cycles don’t just benefit one company…
Given how powerful they are, they can benefit thousands of companies.
But as it turns out, the biggest benefits — and the biggest profits — don’t go to investors in large companies like Microsoft…
They go to investors in the smallest companies:
Start-up companies…
The Early Bird Gets the Worm
You see, as Matt and I have explained before, the earlier you invest in a company, the more money you stand to earn.
That’s because you can invest when their shares are still very cheap.
For example, after Apple launched the iPhone in 2007, its shareholders earned profits of nearly 1,000% — that’s nearly 10x their money.
But the iPhone has helped investors in other companies earn even bigger returns.
Take the mobile gaming start-up King, for example. King was founded in 2003, but it didn’t really take off until the iPhone launched in 2007.
That’s when King developed Candy Crush for the iPhone. With that single game, King started generating millions of dollars in sales each day...
And eventually, the company was acquired by Activision for $5.9 billion.
According to The Guardian, King’s early investors earned nearly 100x their money.
Then there’s the taxi start-up, Uber. Thanks to the iPhone, Uber is now valued at nearly $70 billion — and its early investors have made more than 400x their money.
Unfortunately, during past innovation cycles, investors like you weren’t able to earn those types of profits. That’s because only our country’s wealthiest investors were allowed to invest in private start-ups like King and Uber.
But today, it’s a different story…
A $267 Billion Wave of Wealth
You see, thanks to a new set of laws, now you can invest in start-ups…
And because we just entered a new innovation cycle, now you can take full advantage of it!
This time, the innovation cycle is about a set of technologies called the Internet of Things (or IoT for short).
IoT has quickly become a massive, fast-growing sector. In fact, Forbes predicts that in the next two years alone, it will balloon to $267 billion.
That may sound like a ridiculously large number, but consider this...
IoT is all about connecting everyday devices to the Internet in order to make them more powerful or more efficient. Take the company Nest as an example...
On the surface, Nest produces a basic thermostat:
But unlike most thermostats, Nest’s device is connected to the Internet. So it knows what the weather is like outside, and can adjust the internal temperature accordingly.
Other examples of IoT include entertainment systems that can play your favorite music when you walk in the door... or washing machines that can automatically detect what’s inside them and adjust the wash settings accordingly.
Today, there are roughly 10 billion PCs, laptops, tablets and mobile phones connected to the Internet. That’s a lot of devices.
But within the next two years, Gartner reports there will be 26 billion IoT devices. In other words, IoT will be twice as large as the PC and mobile markets combined.
That’s why experts believe this market will soon be worth hundreds of billions of dollars.
How You Can Profit from This Trend
There are multiple ways you can profit from the “IoT innovation cycle.”
For starters, you could invest in one of the large technology companies that are leading the way in IoT, like Google, Apple or Amazon.
Google, for example, already has a portfolio of IoT products...
For example, its Google Home product is a voice-activated digital assistant that can control everything from your lights to your air conditioner… and it recently acquired the Nest thermostat as well as DropCam, an IoT home security system.
But as I mentioned earlier, investing in large cap companies isn’t the most profitable way to take advantage of an innovation cycle...
History has shown that the largest gains come from investing in start-ups.
Which is why we’ve been highlighting a number of IoT start-ups over the past few months — and why we’ll continue to bring you new ones.
Currently, there are two IoT deals you can invest in:
- Senclo — Senclo makes a “smart” garage door opener. By connecting its device to the Internet, Senclo enables you to control access to your garage from anywhere in the world. So you can close your garage door from the office if you forgot to shut it in the morning, or you can open it from the movie theatre if your neighbor needs to borrow one of your tools. You can learn more here »
- Atmos — Atmos is building a “complete smart home control system.” Instead of just controlling your home’s temperature like Nest, Atmos can control everything, from your thermostat to your lights to your music. You can learn more here »
To be clear, be cautious about diving into these investments headfirst. Start-up investing is riskier than stock market investing — so be sure to do your research.
Please note: Crowdability has no relationship with Senclo, Atmos, or with any of the platforms or companies we write about. Crowdability is an independent provider of education, information and research on start-ups and alternative investments.
Happy investing.
Best Regards,
Founder
Crowdability.com
