Every year since 2001, MIT Technology Review has released an annual list of its top 10 breakthrough technologies that will shape the way we work and live for years to come.
For nearly two decades, the publication’s editorial team has curated its breakthrough technologies list on its own, but this year MIT Technology Review is leaving that job up to none other than the tech industry legend and one of the world’s richest men (soon to be first when Bezos gets divorced), Bill Gates.
Every year, I look forward to this list as an investor because it gives me added inspiration on where to seek out new moneymaking opportunities. Sure, some of the technologies may be far out, but others represent practical investment opportunities for the near to mid term.
With Bill Gates taking over curation this year, I’ve taken a particularly strong interest in MIT Technology Review’s annual breakthrough technology list. That said, I wanted to dedicate this week and next to parsing out his picks and the relevant investment opportunities that surround them.
Of course, not all of these technologies will have actionable investments, but that’s part of the reason we’ll be expanding on each one: to separate the practical from the impractical.
That all said, here’s the first half of our “investor’s take” on Bill Gates’ top 10 technology breakthroughs for 2019.
Technology Breakthrough #1: Robot Dexterity
It’s not at all a surprise to see robotics at the top of Bill Gates’ breakthrough technology list. After all, I kicked off my investment newsletter Technology and Opportunity five years ago with something I called “Bill Gates’ Big Bet,” and that bet was on the proliferation of robots.
Gates had made some very bullish remarks on the robotics industry around that time, and we highlighted numerous robotics companies that investors should be looking out for.
Fast-forward to today, and we’re still incredibly bullish on robotics, as is Gates. We currently have three open robotics positions in our portfolio, and all of them are winners, with 103.8%, 57.8%, and 68.7% returns.
But Gates’ remarks on robot dexterity this year are a little more specific than they’ve been in the past, with a focus on precision. As it pertains to robot dexterity, investors will want to continue betting not only on industrial robotics companies, but also on the companies producing precision-enabling sensors as well.
Technology Breakthrough #2: New-Wave Nuclear Power
Gates is bullish on advanced fusion and fission reactors, which isn’t surprising considering the man’s admirable push to reduce carbon emissions (without pigeonholing himself to wind and solar). Today, somewhere in the ballpark of 65% of our carbon-free power comes from nuclear, so it makes sense that Gates sees nuclear as a critical energy source of the future.
Today, virtually every nuclear plant in the U.S. is a light-water reactor (LWR), based on technology invented in the 1960s. The next generation of nuclear reactors, though, is approaching, with the promise of safer and cheaper power and less nuclear waste.
More specifically, we’re talking about small modular reactors (near to mid term) and advanced reactors (mid to long term). Both offer promising alternatives to LWRs, but as it stands today, the U.S. market is not quite ripe for investment yet.
The Alvin W. Vogtle Electric Generating Plant in Georgia remains the only nuclear power reactor currently under construction in the U.S., and it has been plagued with cost hikes.
That said, globally, there are currently over 80 advanced nuclear reactor projects under development in 20 countries outside of North America. China is a dominant force in that regard, and its utility companies, including Huaneng Power International, Inc. (NYSE: HNP), are likely the best bet on nuclear power investing right now.
Technology Breakthrough #3: Predicting Preemies
Gates believes that blood tests will soon be able to predict, with a high degree of accuracy, if a pregnant woman is at risk of a premature birth, saving countless lives in the process.
Today, there is already something called a bilirubin blood test that can be used to predict risk of jaundice, which can lead to premature birth. Bilirubin tests, though, have been around for years, so Gates is referring to something else.
Specifically, Gates is referring to a recent study (funded by his foundation) that showed you can predict a woman’s due date within a two-week window from a blood test. The test, developed by Stephen Quake, a professor of bioengineering and applied physics at Stanford University, works by looking at how RNA in a mother’s blood changes over the course of her pregnancy.
As Gates admits, however, we’re still years away from such a test becoming routine or commercialized. As far as I can tell, there are no investment opportunities for this innovation quite yet, as the patent application is assigned to Leland Stanford Junior University, with no licensing deals we are aware of.
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Technology Breakthrough #4: Gut Probe in a Pill
In what sounds like something from the world of science fiction, Gates imagines a small, swallowable device that can image the gut without anesthesia.
Exactly what pill Gates is referring to isn’t entirely clear, but we at least know that it ties into Gates’ ongoing fascinations with gut health, specifically the workings of the microbiome.
For the uninitiated, the microbiome is effectively the ecological makeup of bacteria and viruses in our digestive tracts. Gates and others believe we’re on the verge of incredible advancements relating to the microbiome that will change the way we think about and deal with nutrition.
Synthetic Biologics, Inc. (NYSE MKT: SYN) is one among a few companies focused on developing therapeutics designed to manipulate the microbiome for patient benefit. Shareholders, though, have been punished on that one over the last few years, the most recent catalyst being a devastating 1 for 35 reverse split.
Technology Breakthrough #5: Custom Cancer Vaccines
Bill Gates believes that custom cancer vaccines, also known as personalized vaccines for immunotherapy, could have a huge impact on the oncology market, and we certainly agree.
In short, this technology works by activating a person’s immune system and training it to target cancers by their unique mutations. Unlike typical vaccines, though, these treatments would not be taken as a preventative measure but would instead be taken after being diagnosed.
In 2017, early clinical trials first began showing promise of custom cancer vaccines, fending off tumors in a handful of patients. Today, the biotech industry is on the verge of commercializing the first of those treatments as companies race to be first to market.
San Francisco-based Genentech, for instance, a subsidiary of Swiss pharmaceutical giant Roche (OTC: RHHBY), is working with German company BioNTech to develop personalized vaccines for cancer patients. Moderna, Inc. (NASDAQ: MRNA) is also working on its own personalized cancer vaccine.
While these cancer vaccines offer hope for the oncology market, though, there is a caveat. Because the vaccines are patient specific, they cannot be manufactured in bulk. That means there are still uncertainties regarding the scalability of such treatments.
Ultimately, the scalability of these medicines will rely largely on cheap genetic sequencing needed for their creation. Illumina, Inc. (NASDAQ: ILMN) is easily the top player in that regard.
Until next time, Jason Stutman
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