MONEY PRINTING - How an Ugly Yellowish Machine Minted Fortunes
Companies / Investing 2022 Nov 02, 2022 - 10:03 PM GMTBy: Stephen_McBride
By Chris Wood : Have you ever been lucky enough to own a “tipping point” stock?
They can create extreme sums of wealth in relatively short periods of time.
The greatest tipping point stock in history handed early investors a 102,400% gain in 10 years. That turns every $1,000 invested into over $1 million.
We might never see anything quite like that again...
Think about that crazy 102,400% gain and realize...
- This ugly yellowish machine made lots of investors very, very rich.
Look at this hideous thing…
Source: Wikipedia
Believe it or not, without this hunk of junk, we’d still be stuck in the early days of the Internet.
Many folks don’t know that by the time internet reached mass adoption in the ‘90s, it was already quite old.
The first internet came out in the late 1960s. It connected a computer from UCLA with one at Stanford 300 miles away. It tried sending a message, “LOGIN,” but only the first two letters went out before the system crashed.
Early versions of the internet suffered a huge problem… they all used different languages. There was no way for information to pass between them, or for you to access them all from a single computer.
Then, in 1986, a little-known startup named Cisco (CSCO) developed this ugly but crucial piece of hardware that changed the world forever.
They called it a multi-protocol router.
It could translate data between different “internet languages” and connect them into one network.
- The internet as we know it was born.
At first Cisco’s founders sold these routers from their garage, and only got clients by word of mouth.
Still, they landed more than $200,000 worth of contracts in the first month alone.
Sales exploded from there... as did the market value of Cisco.
When Cisco IPO’d in 1990, you could have bought its shares for 8 cents. By 2000, it was trading at $82.
It handed early investors a massive 102,400% (!) gain.
How?
By making a seemingly small improvement to a breakthrough technology—it unleashed the unstoppable growth of the internet.
In the early ‘80s, the internet only had about 200 users.
That grew to 2.5 million by 1990... and 400 million by 2000.
That’s the simple formula for a tipping point stock:
1 – Take a breakthrough technology that hasn’t reached mass adoption yet.
2 – Figure out WHY it hasn’t reached mass adoption.
3 – Solve what is holding it back.
- Nvidia (NVDA) is another classic tipping point stock...
In 1999, it released the first widely available graphics processing unit (GPU), a device that renders high-quality videos for computers.
Other companies had been experimenting with GPUs for years. Nvidia perfected them… and unleashed a 3D revolution.
With Nvidia’s GPUs, video games became more realistic than ever. Animated movies like Shrek started popping up and making hundreds of millions of dollars at the box office. And magazines began "photoshopping” pictures instead of relying on photographers to get the best possible shot.
Without Nvidia’s new GPUs, none of this could’ve happened.
Nvidia released its GPUs in October 1999 when it was a $0.48 stock. By 2002, it was trading at $6.06…
The company went from obscurity to dominance in just over two years. And it handed investors 1,163% returns in the process.
NVDA then went on to become an all-time great stock. I was “late” to recommend it in 2013 at a split-adjusted $2.85/share... and it still went on to soar another 10,000%+.
Investing in a patented technology that will tip an industry from one that’s “promising” to “explosively growing” is one of the surest ways to multiply your money.
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By Chris Wood
© 2022 Copyright Stephen McBride - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.
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