Anyone who follows tech stocks will at some point have seen or heard the phrase “radical technology.” Profits from these disruptive technologies are making headlines daily, and making the investors savvy enough to invest in them rich. But I also have people regularly ask me, “What are radical technologies?” And they wonder why, given the relative volatility of the tech sector, does it make sense to use them to enhance a portfolio?
The quick answer I give people is that radical technology is any invention or innovation that destroys or fundamentally changes an existing business model. Radical technology profits are what they are because the tech represents a shift to an entirely new system. The old models are gradually phased out as the new technology is adopted more widely.
We Are Living in an Age of Radical Technology
Innovation is now happening at an extraordinary pace. This is because the rate of progress and the accessibility of technology are creating an environment where industries are growing increasingly interconnected. Take machine learning, for instance. I have seen industries as diverse as healthcare and trucking benefiting from it, and I know they will continue to benefit from this technology as it evolves.
Consumer adoption of radical technologies is also speeding up. Cloud computing is now practically the norm, and even if we’re not using cryptocurrency, we’re still comfortable with nearly all of our financial transactions taking place in the virtual world. The stage has been set for the success of radical technologies, and those who recognize their potential early on are the ones who will profit from them in the long term.
Radical Technology Changes Our Lives
People define radical technology in all kinds of ways, but most agree that to be truly radical, an innovation must wholly replace an existing system, process, or design. Radical technologies are those that feature new components interacting in new ways to solve existing problems better than existing technologies.
I remember when streaming video was a radical innovation. It killed the brick-and-mortar movie rental model and will probably completely undermine the need for physical media in the not-too-distant future. For those of us old enough to remember a time when you watched what was on television or you didn’t watch at all, streaming video represents a huge change in how entertainment is consumed.
Why So Few People Reap Radical Technology Profits
There is risk associated with radical innovation, but there are also big rewards for those whose eyes are open to what’s on the horizon. And I know from experience that seeing what’s on the horizon is not necessarily difficult. The reason radical technology profits are concentrated in the hands of a select group of investors is that disruptive innovations tend to meet with resistance until a tipping point driven by adoption or convergence is reached.
Consider streaming video once again. There was a time when brick-and-mortar movie rental companies weren’t particularly worried about the impact streaming video would have on their profits. Streaming was for computer nerds. After all, who watched that many movies? Who had that kind of bandwidth? Now we all have that kind of bandwidth, and people (myself included) will happily binge watch an entire series in a weekend.
Could you have predicted the rise of streaming video and music? If your answer is no, think about the question in another way. Let’s say in 2005 I had asked you: Would you pay for a video service that lets you watch exactly what you want, whenever you want it, as much as you want? Framed that way, I bet your answer would be an unequivocal yes. Profiting from radical technology is sometimes a matter of thinking of emerging innovation in a different way.
Where to Find Radical Technology Profits
The quick answer is: anywhere! Because industries are more interconnected now than ever, I’ve seen how you can profit from radical technology by looking outside of the tech sphere. The farming industry (which now includes the fascinating cannabis industry) is evolving thanks to Big Data. Healthcare is changing because of innovations in AI. And just about every industry you can think of is benefiting from cloud computing. You have the choice to reap radical technology profits directly or, if you have an eye for how tech will be adopted in specific industries, you can benefit from innovation without investing directly in emerging technologies. It’s all about following not just emerging technologies, but also how they are being utilized.
What Industries Should I Be Looking at for Radical Technology Profits?
Obviously, given the rapid pace of change in technology, it’s not necessarily easy to see what will be supplanted by emerging innovation. That said, these are some established and new radical technologies I think you should be exploring.
You might be wondering why cloud computing made the list when it’s now a part of most of our lives in one form or another. The answer is that right now, the cloud continues to be disruptive to legacy players that will have to change their business models to survive. I can remember when the most advanced computing was only available to large enterprise companies. Now small companies and even individual researchers can access supercomputing power like never before, leading to major innovations outside of the big players. Cloud computing is a technology that’s changing the tech industry itself.
Once a niche piece of tech that was more of a curiosity than anything else, 3D printing is now being used to build houses, food, steel objects, engine parts, and even organs. Right now, I believe we’ve only seen the tip of the iceberg when it comes to what new products and processes will develop as 3D printing gets less expensive and more commonplace. Rapid prototyping alone is sure to change how some industries innovate, particularly in the medical device space.
People are only just beginning to explore what happens when you use huge amounts of data to train computers to do tasks that used to be done by people alone. The coolest thing about machine learning is the building block nature of this tech. The more you use it, the better it gets at what it does, whether that means identifying cancerous cells, doling out financial advice, drawing predictive conclusions from real-time business data, or driving a car. Even now, machine learning is reducing manufacturing costs and increasing productivity in a wide range of industries. And with hypothesis generation AI programs (sometimes called AH), computers aren’t just spitting out answers, but also asking the questions.
Not that long ago, unstructured data was useless until a human being put them in a format that computing systems could understand, but structured data was relatively incomplete in most industries. Now I’m seeing technology emerging that lets industries gather unstructured data in real time, add it to the structured data already being collected, and analyze and manipulate that data (usually with the help of natural language processing and machine learning) so all of it can be correlated and data-driven hypotheses can be generated.
This technology has not yet been thoroughly explored, but I see so much potential in it. The manipulation of matter at the atomic level may ultimately give us cost-effective self-assembling machines, safer synthetic vaccines, processing power unlike anything we’ve ever dreamed of, materials that could make plastic obsolete, light-activated cancer drugs, and the ability to 3D print living cells. Imagine how just a few of these things could change our lives and our economy!
The energy sector can lag when it comes to true disruption because oil, gas, and coal are still fueling most human activity around the world. Why haven’t the big energy companies jumped on board the alternative energy wagon? Possibly shortsightedness. While electric cars abound and houses in diverse neighborhoods sport solar panels, it may be that the tipping point that results in disruption hasn’t yet been reached. I know it’s coming, though. Hawaii and California have both pledged to become 100-percent renewable energy by 2045. Peer-to-peer electricity trading between consumers is flourishing. Smart grids are opening up the possibility of switching to renewables where it wasn’t logistically possible before. Alternative energy will ultimately dominate.
I’ve said before that shape-shifting smart metals may spell the end of silicon’s reign in the semiconductor industry, but that’s not all these new alloys can do. Imagine an electronic tattoo that can monitor a patient’s vitals and transmit that data to doctors remotely. Shape memory alloys (one distinct category of smart metals) are a fascinating alternative to conventional actuators. Taken together, innovation in this area points to big changes in the future of manufacturing.
Cryptocurrency is cool and certainly has opened doors for the evolution of the financial sector. Blockchain itself is a disruptive technology because the way it decentralizes data makes it highly useful for collaborating and transacting across industries. I believe this peer-to-peer technology can be useful in medical administration as part of clinical trials, billing, sanitizing patient information, and keeping track of pharmaceutical use. In capital markets, blockchain will revolutionize the way information is shared and how assets are moved.
Internet of Things:
Smart objects are quickly taking over the world, but I still see so much untapped potential in terms of how the data collected by these objects are used and how interconnected objects can make people’s lives better. In the insurance sphere, there’s the potential for connected devices to potentially help assess risk and analyze insurance claims. Data from wearables may fundamentally change health care when combined with Big Data and machine learning.
What’s the Takeaway?
I’ve seen the technologies continue to create rapid, major, and sometimes uncomfortable shifts across industries. They’re increasing productivity, lowering costs, and forcing established companies to innovate to keep up. Adaptation is critical, and that’s true for investors as well as businesses. Capitalizing on radical technology these days isn’t just about recognizing that a product or process is disruptive. I tell investors they need to be able to see what impact radical innovation is having across industries. Ultimately, those industries will have to evolve to accommodate the disruption, and the ones that do so successfully will be tomorrow’s winners.
If you’re interested in earning some of these radical technology profits for yourself, I encourage you to subscribe to the Nova-X Report to start learning about how tech investing can improve your investment portfolio and potentially change your life.