Investing in technology might probably be one of the best decisions you would ever take in your lifetime. However, like any other industry segment, investing in technology comes with its own risks, processes, growth projections and returns.
Just to give you an example, someone who was an early investor in Tesla is now handsomely a millionaire, while someone who was an early investor in Faraday Future has probably gone bankrupt. Investing in tech can be a high returns opportunity, but it can also lead to high risks and losses.
In this article, we speak to successful investors and ask them for tips on how people who are looking to invest in tech proceed. We are also going to look at some successful and new investment opportunities in technology that are worth considering.
Must Read: How Technology Can Help Your Business Grow
5 Tips for successfully investing in technology sector: The List
1. Do your research about the Founder and the Team
Companies are often an extension of their founders and the people who are leading it at the helm. This is why investors should do their research about the CEO, Founders, and the higher management team. Identify them according to their professional expertise and assess whether they have it in them to take the company to new heights.
2. Understand the Technology and see what lacunae it fills in the Market
Creating tech just for the sake of it is not going to make a company successful. Like the traditional rules of investing, it is important to understand whether the tech company is being successful in addressing the lacunae in the market. What needs is it servicing to, how utilitarian it is are some questions, which you should give serious thought to.
3. Hints and comments from Leaders and High Income Investors
Industry leaders and billionaire tycoons are often asked about what they think of new tech companies. Sometimes they are often appreciative of new tech, while at other times, they make their disgust quite apparent. It is important that you follow newspapers, interviews, seminars, and presentations where the media asks important questions to these biggies.
4. Industry Analysis and Competitor Research
You are not going to get a staunch Unicorn novel idea every single time. You will have to differentiate between similar companies operating in the same tech landscape. The key in being successful while doing this is to follow the status and position of what its competitors are doing. This will help you get a better idea of the task and prepare you accordingly.
5. As an individual do you understand Tech
It is no secret that some people understand technology while others do not. It is also known that some people take an interest in technology, while others do not. You need to ask yourself, what kind of an individual you are. If you are not interested in something tech-related, you should never ever think of investing in a technology company. Interest plays a major role.
New Investment Opportunities in Technology you should check out
Technology is a highly dynamic and ever evolving industry. What is hot and cutting-edge today, might just turn obsolete within a few years. Hence, it is important to understand the growth cycle of technology.
Expert investors point out that there are two areas of investment, which everyone should explore. These are Ecommerce companies and Cryptocurrency as a financial asset of investment.
Ecommerce companies like Amazon are growing in valuation every single day. On the other hand, cryptocurrencies like Bitcoin are maintaining great value even during the Coronavirus downturn. According to trust pedia, many seasoned investors from Wall Street are betting big on cryptocurrencies like Bitcoin as a stable, safe, and high return financial asset.
Whenever you are investing in tech, always follow the five points that have been mentioned above. These will not only protect your investments but also help you get high returns.