Investing In People and Ideas Who Tell You You’re Wrong

It happens slowly. It happens over time. And then it happens suddenly.

The things that change slowly rarely bother us. As an investor, I realize there’s something to that. What products or services melt into your life day-to-day, slowly, and over time? The ones you can’t get rid of. The ones that always seem to have this slight tailwind pushing it along an adoption curve.

Slowly, but surely.

I think of cashless payments and card readers like Square and Clover. It’s happened slowly, it’s been happening over time, and then suddenly it will be.

But what is the opposite? What does it mean to not have something that evolves slowly over time? The opposite is loud and it’s right now. The opposite means you must embrace it because if you don’t, well – who cares – it will change you.

Sometimes this works.

Sometimes it does not.

The key is knowing the difference between something that really is a force of disruption at its very conception vs. something that is just an improvement of what’s already been done. There are only a few things that ever do the disrupting. Maybe one every 10 years. And when they do, it is loud.

The iPhone was one of them.

So are avocados. Lol. People joke about avocados and my millennial squad who eat them, but at the end of the day, they’ve changed nutrition and how people think about it. Good cholesterol, healthy fats, and the list of benefits goes on for a $1.50. Very few people were thinking like this before. Now everyone is.

I sometimes go back in time and read reviews of the iPhone when it first came out. There’s dislike, there’s doubt, and there’s a general sense of pessimism. Several editors at big publications ran with harsh criticism. So did Wall Street analysts and your colleague who you sat next to on the 17th floor.

“We don’t need a computer in our pocket! We have one on our desks!”

When I think about Tesla and Elon Musk, I think something similar is happening. A company is telling you sweeping change is coming. And it’s going to happen now. They are telling you that your routine, your gas cars, your daily commute are all wrong.

You are wrong.

That is loud. That disagrees with many people and their being. I think that’s also why so many people have been on the wrong side of the trade. One of the greatest stocks to own since 2013 happens to also be one of the most hated.

I believe in 20 years we will look back and ask ourselves why did we see it any other way? Let’s burn thousand-year-old oil taken from deep beneath the Earth only to release its byproduct of ash and emissions into the open air. Let’s also drill a giant hole in the middle of the ocean. Let’s drill to the earth’s plates, the same ones that move entire continents. Then let’s burn it! Let’s leave that giant hole sitting there!

I find it safe to say that those who are open and forward-thinking will exceed and win more often than those who are not. Holding onto dogmatism is a dangerous path for your portfolio and your leadership.

This post is not saying Tesla will win forever. Or is it a flat out endorsement. What it is saying, however, is that disruptive products are loud and in your face for a reason. And often times your dislike or frustration toward them is because you refuse to embrace it even though deep in your subconscious you know it’s coming.

For Tesla, it’s an iPhone moment for cars. So is the insanity of Tesla and its Tweeting leader. Ah, Twitter and its power.

Would I bet against that? Not a chance.

Am I interested to learn more about loud products like this and their societal impact? Absolutely.

If you get one of those right, whether you’re the creator, founder, early employee, or investor, that’s where the real money is made.


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