The Five Innovation Platforms That You Shouldn’t Miss Out On

ARK Invest believes innovation is evolving at such a rapid pace that traditional equity and fixed income benchmarks are being populated increasingly by so-called value traps, stocks and bonds that are “cheap” for a reason. Any company not investing aggressively in one or more of five major innovation platforms and 14 technologies evolving today will lose its way.

What are the five innovation platforms?

And the 14 technologies?

1.     Blockchain - Blockchain

2.     Frictionless Value Transfer - Blockchain

3.     Autonomous Mobility - Energy Storage

4.     Battery Systems - Energy Storage

5.     Sequencing Technology - DNA Sequencing

6.     Gene Editing - DNA Sequencing

7.     Immunotherapy - DNA Sequencing

8.     Adaptive Robotics - Robotics

9.     3D Printing - Robotics

10.  Reusable Rockets - Robotics

11.  Neural Networks - Artificial Intelligence

12.  Mobile Connected Devices - Artificial Intelligence

13.  Cloud Computing - Artificial Intelligence

14.  Internet of Things - Artificial Intelligence

 

ARK’s Cluster of Major Innovation Platforms

According to ARK's research, among the siloed sectors at risk of disintermediation are energy, industrials, consumer discretionary, communications services, health care, and financial services. "As autonomous transportation evolves, for example, autos, rails, and airlines are likely to capitulate to the convergence of robotics, energy storage, and artificial intelligence. Combined, they will collapse the cost structure of transportation." Traditional healthcare is likely to give way to the convergence of next-generation DNA sequencing, artificial intelligence, and gene therapy, the combination of which should significantly increase the return on investment, ARK believes.

In their view, most of the platforms mentioned above are entering exponential growth trajectories thanks to the falling costs and increasing productivity associated with technologically enabled innovation. For example, in response to the 28% cost decline in lithium-ion batteries for every cumulative doubling in units produced globally, prices will continue to fall, “turbocharging” electric vehicle (EV) sales. According to ARK’s research, EV sales will scale 20-fold globally during the next five years, from an estimated 2 million and ~2.5% of the market this year to 40 million and ~45% in 2025.

ARK Invest assumes that the global economy has entered a period of changes, some of which are exceptionally good and others destructive. That will shape the market in the future. The correct orientation towards change can determine success and failure, which is why ARK suggests paying attention to next five innovation platforms in the new world.

How about Malaysia? Are we geared for this? Or are we drafting blueprints still?

 

Reference:

Investors Beware: Stay On The Right Side Of Change, 28 Dec 2020, ARK Invest