By Aman Raina, SageInvestors

Special to the Financial Independence Hub

I get asked a lot about how to find companies and stocks to invest in. Where do you start? It’s a great question and also an overwhelming question to people. They’ve set up the broker account. They put in some money. They’re now ready to buy stocks. Where to start?

A few years ago I wrote a blog on how to find stocks to invest, where I suggested a simple and easy starting point in identifying companies to evaluate. The premise was identify the core necessities of life that we need on daily basis and find those stocks that offer that value proposition. The necessities of life are essentially food, clothing, shelter, and transportation (I may add another one communication). Identify the companies in each pillar and evaluate them to find the best run, best managed, best performing.

These days, one of the prominent business thought leaders is Scott Galloway. He is a walking market research machine and can hit with you with so much data you’ll faint. If you want proof check out one if his presentations.

Galloway blogs as well and awhile back he posted a piece of how Uber could get its groove back after all the leadership missteps. He mused on the following:

“…Begin thinking of Uber as an OS. The most impressive firm of the nineties was the original gangster leveraging the operating system — Microsoft. The most influential firms of the last decade, the Four (Amazon, Apple, Facebook, and Google), have become operating systems for retail, media, connections, and information, respectively … and extract serious rents from the apps that sit on top of the OS. What firm has busted a move and blown through $100B market cap that isn’t effectively an OS? The latest, Netflix, has taken advantage of the extraordinarily lame cable industry and now occupies the second-most-important screen, the television. Netflix has increased its market cap 2400% in the last five years.

In sum, the only way Uber gets from $70B to $700B is to become the OS for travel, becoming the user interface / API / rules for all transportation. Leveraging AI, cheap capital, and relationships with 40M of the planet’s wealthiest consumers each month, Uber should expand its offering (dramatically). Same interface, but instead of entering “ACK airport,” where I’m headed Sunday morning, I type in “London,” and using AI — connecting the dots of my preferences, economic weight class, deals at the time, APIs — Uber presents the best options for not just the ride to the airport, but the flights to JFK, then London, the car that picks me up, and the hotel I stay at. Uber has the license to do this. The ride-hailing firm can’t get there on its own and will acquire other firms…”

It’s a pretty compelling argument and it made me wonder what other “OS’s” are out there in other industries? Then I thought about my pillars, food, clothing, shelter, transportation? Has anyone staked their claim as owning the OS for these pillars? Where would Google, Amazon, Facebook, Apple play in this? I thought it would an interesting exercise to carry out and may it can uncover some interesting investment opportunities. My search for the next great stock had begun.
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