Is the App Bubble that we rode from 2010 — when I left TV and came back to investing and trading in the markets — to the end of last year finally over? Has the App Bubble popped?
Well, in a word, the answer is simply: yes.
The energy and commodity crash has become a Black Swan-worthy event much quicker than anybody expected. Not only that, but aside from a handful of stocks, there are so many once-highflying companies that were worth billions or tens of billions of dollars that are down 50% to 90%. And app-related (note not “App Revolution”) Stocks from Zynga to Yelp to Twitter are crashed just as hard and maybe still headed lower still.
So the App Bubble has popped. But the App Revolution is just getting started. And I’m still betting on the App Revolution in many ways, including holding onto my long-held App Revolution stocks like Google, Facebook and Netflix.
Why? Over the next five years is when great fortunes in the App Revolution will be made, just as the companies that survived the Great Dot Com Bubble popping eventually created great fortunes. Back on August 30, 2010, I wrote in “How to invest today for the App Bubble coming tomorrow” (bold mine):
“Remember in 1996 and 1997, when you’d not only heard of the Internet and its wonders, but you’d actually at some point started using that new “browser” technology to engage the “world wide web”? Yeah, the early adopters had already been “surfing the Net” for years and we were finally hitting “critical mass” for email, as the vast majority of Americans were signing up for their first accounts at AOL, Yahoo, and Hotmail.
And then we entered the 1998-2000 phase, where the term Internet Bubble was born during which for a couple years there, any company that had absolutely anything to do with the Internet would double, triple and quadruple in price. Sometimes in just few weeks’ time. And a lot of vast fortunes were indeed made in those heady days.
Of course, you had to sell when the bubble started popping in 2000. And it would take another five years or so, but eventually real, sustainable widly huge fortunes were created by the Google’s, PriceLine’s, eBay’s and Baidu’s of the world.“
So here we are now in 2016 and the App Bubble has indeed popped. But now is when the real hard work begins and over the next few years is when the long-term wealth will be created. We’ll want to continue to own the dominant App Revolution companies that have created platforms like Google with Android and Apple with iOS or that have become de facto standards like Netflix with TV and Facebook with social and messaging.
And I know many of you remember me telling you back in 2009 on my TV show and on Marketwatch to create apps yourself. You can rest assured that I’m continuing to bet not just my money on App Revolution stocks, but also on the App Revolution itself for myself with the new Headlne apps for iOS and for Android. Headlne is a new way to stay up with the most important news and real-time headlines. Let me know what you think of it.
Apps are already a trillion dollar industry and will only grow from here. There are new apps coming out this year and new app companies will be set up in the next few years that will change the world. One of them will be the next Facebook, Netflix and Google. Let’s find them. As I’ve said for many years now, we should bet big on the App Revolution, even if the App Bubble has popped.
As I’ve often pointed out, we shouldn’t overthink this. As I wrote in 2011 in an article called “Fortunes and pain to come in the next great bubble: “When you see the chance to get in front of an industry that’s changing the entire world around you and will continue to explode in growth for the next few years at least…well, you just want to invest in that industry. Regardless of the ups and downs and twists and turns, through all of that, the revolutions will continue and fortunes will be made. I want to make some of that fortune. Don’t you?”
We’ve made small fortunes over the last few years as the App Revolution has brewed by owning some of the best App Revolution plays in the world, like Google, Amazon, Netflix and Apple. And I think there are lots of big fortunes left to be made in the App Revolution. If you haven’t invested in app stocks or started your own App Revolution company yet, be careful out there and don’t go blindly rushing into them just now. But don’t think that this revolution is over. And be sure to let me know what you think of the new Headlne apps for iOS and for Android.