The late Steve Jobs once said: “People don’t know what they want until you show it to them. That’s why I never rely on market research. Our task is to read things that are not yet on the page.”

To innovate, to bring about something new, often times you have to think outside of the box.

Through the introduction of the iPhone, Jobs and Apple (NSDQ: AAPL) changed the world.

More Than a Phone

Before the iPhone was the era of the Blackberry, one of the earliest smartphones. The keyboard took up half of the phone on the Blackberry but users didn’t seem to mind. But then the iPhone came along and showed everyone that you don’t need to have a keyboard to have a mini computer in your pocket.

Voice communication, originally the purpose of a phone, became secondary. The smartphone became a personal entertainment system: texting, gaming, social media, video consumption, etc. One 2021 survey showed that not including work-related usage, nearly half of people who answered the survey spend five-to-six hours per day on their phone. Indeed, without the iPhone, you probably won’t have the Instagrams, Snapchats or TikToks of today.

While turning many people into distracted zombies glued to their phones is not a great thing, there’s no denying that Jobs has left an indelible impact on the world. Even if you aren’t a fan of Apple’s products, if as an investor you recognized the potential of the iPhone and bought some AAPL, you did pretty well.

Huge Return

The original iPhone was launched on June 29, 2007. Had you bought $1,000 in Apple stock on that very same day and held on for the last 15 years, today that $1,000 would have become more than $44,000.

And if you were even more proactive and bought the stock on the day that the iPhone was announced, you would have done even better. $1,000 would have become more than $58,000 today.

Of course, not every company can be Apple and not every innovation can be the iPhone. In fact, there is only one Apple and the iPhone’s is the most commercially successful product ever so it’s literally unmatched by anything else.

As an investor, are you looking for the next big thing? To find success, a company doesn’t have to be as well known as Apple, or for that matter, Amazon (NSDQ: AMZN) or Tesla (NSDQ: TSLA).

Under-the-Radar Game Changers

Here are a few lesser-known examples of innovation.

Tandem Diabetes Care (NSDQ: TNDM) invented an insulin pump that was small, convenient, safe, and later upgraded to be autonomous. Less than five years ago, the stock was trading for under $3 a share. Late last year, it reached as high as the $150s. Today, it has fallen into the $40s as sales trends have disappointed lately. But even if you held onto the stock throughout the slide, selling it today would still give you roughly a twentyfold return.

ASML Holding (NSDQ: ASML) is the first company to develop extreme ultraviolet lithography (EUV), an advanced technique that enables the fabrication of very small but very powerful microchips used in today’s devices. Continued advances in semiconductor technology wouldn’t be possible without EUV. Today it is the only EUV equipment supplier in the world. As with TNDM, ASML is way down from its all-time peak of nearly $900, but at roughly $500 as of this writing, it’s still about three times its share price five years ago. And if you bought the stock even earlier, the gain would have been even greater.

Four students at Standford University founded Align Technology (NSDQ: ALGN) and developed a system using clear retainers called Invisalign to align teeth as an alternative to the traditional cumbersome and ugly metal braces.

Orthodontists were skeptical at first, but Align won them—and customers—over. Now Invisalign is accepted as standard orthodontic treatment. Eight years ago, the stock could have been had for under $60 (of course, if you had bought in earlier, you could have gotten it at a lower price). At its peak last year, the stock broke the $700 mark. Now the stock has dropped sharply into the $250s, but you would have had ample opportunity to exit the position at a much higher price. Even at $250, that’s a very nice return.

As you can see from the examples, innovation can occur in different fields. As an investor, you need to keep your eyes open and appreciate big potential when you see it. Secondly, once you’ve hit the jackpot, it’s also important to know when to hit the eject button.

Editor’s Note: Technological disruption never ceases. Think tech’s dominance over the stock market is over? Nope. It’s only getting started.

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