Tech companies have been on the rise for some time now as they offer advanced devices, cars, computers, and many more that transform the daily lives of mankind. Because of this, many investors are trying to jump in and become wealthy by investing in the tech industry. Let's dive in to understand why tech companies gained such value recently and how we can be a part of this trend.
Biggest stock gainers in history
Tech companies are very important startups as they have the potential to enhance our abilities by introducing new technologies that make doing things easier and easier. Many investors and average people are watching the tech sector closely and trying to invest in new startups that can have massive returns. Companies like Apple, Samsung, and many more are offering cutting-edge devices to global consumers and are known for their efforts to constantly innovate and improve their products. Many investors try to be early birds and invest in companies that have the highest potential to increase their stock prices dramatically. Despite the impressive success of tech companies in recent years, it's important to note that the biggest stock gain ever in one day did not come from the likes of Google, Apple, or Samsung. In fact, these companies are not even on the list of the top five of all biggest gainers in history. However, the potential for massive returns in the tech sector continues to attract investors who are always searching for the next big thing. Companies like Tractor Supply, Altria, and Monster Energy are among the top 3 companies that gained massive value and many people do not even know their names.
How to catch the next big thing?
What to look for in tech startups to become successful investors? There are several steps and signs to define if a startup we are looking at is a potential Apple or Google. Market research, analysis, and intuition are three main factors that can help investors catch potentially successful startups in the tech industry.
Market Opportunity
It is a good idea to filter startups by their targeted audiences. Make sure the startup is addressing a large, underserved market with a solution that can affect their decision to buy the product. If the startup offers a unique and highly demanded product then it has a higher chance of success in the industry. By offering products that can disrupt the market and generate significant profits the stock price is almost guaranteed to grow consistently. Another good way of looking at this is by analyzing already successful startups like Oculus Rift, ChatGPT, and others and trying to understand what these products have in common and if the startup you are looking at has the same potential.
Innovative technology
When speaking about the technology sector, innovation is its main characteristic. Try to catch startups that have an innovative approach or innovative products that can disrupt the industry, the existing markets or create a new one. If the technology offered by the startup is unique, scalable, and well-differentiated it can create a competitive advantage for the startup increasing its chances in the modern super-competitive landscape.
Startup team
The team behind the startup is super important for its success. If the team is experienced, motivated, and knowledgeable and has experience in the industry it can increase the success rate of the company. Education can also be an indicator of their expertise, some of the founders of great startups like Zipline had an education from MIT. MIT is known to have top-notch education in technology and science and when the founder of the startup has graduated from such a university the chances of success are becoming real. The team's ability to adapt to changing circumstances and execute its strategies is critical in the tech industry. Try to find out if the team behind the startup has an experience with successful projects or a career to find out if they can lead the startup to a successful future.
Minimum viable product
Investing in startups that already have a prototype of their product has a higher chance of making huge returns than investing in a startup that promises to develop a product or a solution. Especially valuable are startups that already have a basic product that delivers what the team is promising. This basic version of a product has to be developed and tested to determine its viability on the market.
Investment from reputable investors
Top investors have vast experience investing in startups and they have a professional intuition to catch the best startups with the most chance of future success. Because of this make sure you have researched top investors who are supporting the project. These investors could be revenue capitalists or angel investors and it can be an indication of a startup's great potential on the market. These investors also increase the confidence of other investors and can increase the price of the startup's stock.
Potential for future growth
Look for startups that have a potential for future growth such as expanding into new markets or developing additional services or products. This can ensure the startup's long-term viability. Can startups make their product available in other countries as well? Do other people also need the product or service? Ask these questions and if the answer is yes, then the startup may be a success.
