What do a Catholic School and Mega Millions Jackpot have in common? Hopefully–NOTHING! However, Saint Francis High School, founded in 1954, won big on what many of us would call a Tech-Investment Gamble.
Back in 2012, the board of the Saint Francis High School in Mountain View, California, (SFHSMV) invested $15,000 in seed money for
Snap Inc., the maker of Snapchat photo—a new messaging application which was popular with teenagers at that time. Did they win or lose?
Well, as of March 3rd, 2017 their $15,000 was worth $24 Million Dollars.
Most investors would love to find themselves in the middle of IPO (Initial Public Offering) Explosion like this. These results are far from the norm. It may even seem like the SFHSMV benefited from some Divine Intervention.
Turning a few thousand dollars into millions by investing in new technology products like photo messages apps is a long shot. There is a tiny chance to win big, and a huge chance to lose part or all of the funds you invested in these companies.
There is a good reason for this. Very few technology products pass the market test, become popular among consumers, and cross the “tipping point,” reaching the mass market. That’s why it’s very unlikely for investors to make money in high-tech start up-ups.
So what’s their secret?
The board members of the school did something interestingly progressive. They payed close attention to what apps were popular among teenagers — the “early adopters” of technology products – that is.
Snap Inc., the maker of Snapchat photo—a new messaging application which was popular with teenagers at that time.
Forbes contributor, Panos Mourdoukoutas wrote, in an article about this amazing happening.
“How can investors separate winners from losers? By watching“pioneers” and “early adopters,” younger consumers who are eager to try new products and share their experience with others, fueling WOM and buzz for these products.
Specifically, ”pioneers” are restless and curious, consumers enchanted with the new and the exotic, according to marketers. “Early adopters” are consumers who are always on the lookout for products that will improve their personal and business lives—a larger group than the pioneers, the bridge to reach to an even larger group, the “early majority,” and help products cross the “tipping point,” reach the mass market.
That’s when sales soar and the companies that make these products attract the interest of Wall Street, where early investors cash out in an Initial Public Offering.”
