Why Should You Invest in a Technology Company?
Updated: Jan 17
The technology sector represents one of the hottest investment opportunities available today. From Corporate America to Wall Street, tech remains on the tip of everyone’s lips. And if you consider the volatility in other investment opportunities, from crypto to the see-saw real estate market, technology companies look like a pretty good bet for investors seeking consistent returns. According to Bloomberg statistics, the tech sector (hardware and software) offers the third-highest returns out of eleven evaluated sectors. And it isn’t difficult to understand why.
From Innovation to Invention: It All Starts with Tech
More than anything, technology companies are associated with innovation and invention. They are the companies that stand at the forefront of research and development. While the healthcare and pharmaceutical industries spend the most dollar-for-dollar on research and development, the actual companies spending the most on market research and research and development are tech companies. As a result, technology companies generally provide a steady stream of innovative products and services addressing the needs of today.
Consider all the ancillary industries tech products touch on a regular basis. Products and services developed and sold by technology companies wind up working their way through all sorts of other sectors and industries. In reality, there really is no sector of the modern economy that is not touched by technological innovation. And this includes industries you wouldn’t even expect. Take the trucking industry, as one example. Many people consider trucking to be a legacy industry. They’ve done things the same way for a long time. But now, thanks to technology, even the way freight gets hauled across the country is changing.
Take Pathways and ICOM Productions, as two examples. As part of The Learning Network, one of Pluribus Technology’s acquired companies, Pathways and ICOM Productions provides diesel technicians with the potential to use virtual reality and to work on heavy-duty commercial motor vehicles more precisely. And these technologies can be used for commerce or education. Virtual reality allows simulated, real-world experiences for learners to make mistakes without real-world impacts. They say practice makes perfect and practicing in a virtual world may be the ideal option for companies who need precision work done right the first time, every time.
Taking Advantage of Competition and Obsolescence Cycles
One other notable aspect of technology companies lies in their cycles of competition and obsolescence. What does this actually mean? While a tech company may be competitive one day and obsolete the next, these cycles generally do not last very long. The very nature of tech innovation lies in its ability to adapt to changing times. Microsoft was the dominant tech industry until the advent of the smartphone. As Apple ascended and Google dominated the mobile operating system space, there were many who predicted Microsoft’s demise. Today, Microsoft is approaching a $3 trillion valuation. The very nature of technology companies allows them to heavily compete while avoiding becoming obsolete.
That’s why we have chosen to acquire companies that we feel will be able to survive, innovate, and compete, without finding themselves obsolete. From eLearning to eHealth, eCommerce and digital enablement – these are sectors that will continue to see innovation and growth for many, many years to come. The boom-and-bust cycles of other industries, from energy to housing, make for riskier investment propositions.
Meanwhile, at Pluribus Technologies, we represent an investment opportunity built on a sector that will be with us for the long term: Technology. Are you an investor trying to find a place to park your money as inflation chips away at it? Pluribus Technologies offers a very appealing value proposition. Find out what you, as an investor, need to know and look at the portfolio of companies that will confidently lead us into a bright and innovative future.