Sean IddingsKeymasterOfflineTopics: 104Replies: 22
As a musician, entrepreneur and investor, I’m not surprised when I hear about certain musicians being very successful investors. In fact, we are about to release an online course to our members on how the best musicians stand on the shoulders of giants to see further. We’ve adapted it for business, investing and any other craft.
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For instance, we wrote about how the curly haired, soprano saxophone totting, smooth jazz legend Kenny G invested in Starbucks in the 1980s. He rode the company all the way. Despite selling more than 75 million records, he has made more money investing in Starbucks and holding.
I wasn’t surprised when Paul David Hewson (known as Bono, singer of U2) made a prophetic forecast on Apple.
This is exactly what he said (emphasis added by us):
Mitchka Assayas – So what’s your vision on the future? How far do you see? We were talking about chess. How many moves in advance can you come up with?
Bono – Well, [clears throat] in music, the thing that I’m excited about now is how the iPod will turn into a phone. You will be able to carry your entire collection with you wherever you go on your phone. If the Internet is the freeway, your phone is the car.
In hindsight, we can see how totally accurate that statement was. Since inception the iPhone has generated $852.775 billion in revenues for Apple! iPhone profit has amounted to 100s of billions of dollars.
Sure, U2 had been working closely with Apple to create the U2 Special Edition iPod. Bono likely had insider information on the iPod turning into a phone.
Had one pieced together the qualitative information: Bono has deep industry fluency, insider information, and that Steve Jobs was intelligent fanatic, they could have made a bet on Apple. Had one read this statement on the date of publication (April 4, 2006), Apple’s stock was trading at a split adjusted $10. Today it is trading at $180. That is a 27% CAGR without counting dividends. Compare this with the S&P 500’s 6.5% CAGR over the same period.
For investors, I think the moral of the story is to keep your ears and eyes open for differential insights that can give you an edge.
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