The 3 companies that will conquer the world

Editor’s note: This article was first published in June 2017 as a forecast; Amazon selling only non-perishable groceries in Spain, its drone delivery tests and talk of Apple or Google buying Tesla reflect that time. Apple passed a $1 trillion market value in August 2018, Amazon briefly in September 2018 and Alphabet in January 2020.

In the coming years we will witness a historic stock market event, when one or several companies pass the milestone of a $1 trillion market capitalisation, a valuation never before reached by a listed company.

We are not talking about oil companies or banks today, but about several very well-known companies that are probably not even at 30% of their full potential. If we think strategically, we will realise that, after certain moves, these companies will capture a large percentage of the money that circulates in the world. These companies are:

1. Google (Alphabet Inc.)

When Google was trading at $1,195 a share, I took the risk of saying that this company could double its value in 5 years, and that in 10 years it would triple it. After the stock split, we can see that the scenario is playing out perfectly.

At present, Google gets most of its revenue from advertising on its search engine and on media (blogs, websites and YouTube), but over time its revenue may start to multiply in other areas and other kinds of services.

As we have said on other occasions, Google is a company strategically placed to enter practically any sector and do it successfully.

It has the talent, the knowledge and the money needed to take over other strategic companies. It could easily enter banking (Google Bank), as PayPal is already doing with loans to entrepreneurs in the United States.

(See: If Google went into the restaurant business, how would it do it?)

It could even happen that its revenue grows dramatically through sales of physical products, until that income matches the income from its current and main business, advertising.

It also owns the largest video platform (YouTube), which, if the right moves are made, could be the television of the future: the data today say that many people already spend more time on YouTube than in front of the TV.

See also: 8 original ideas and products that are already a reality in 2017

Without a doubt, Google is the ideal candidate to pass the milestone of a trillion euros in market capitalisation.

2. Amazon

Now I am sure of it. Amazon will be the biggest “shopping centre” in the world, and it could become a threat even to the main supermarket chains.

At first, Amazon did not behave as a competitor to many small businesses; quite the opposite. Amazon gave small shops the chance to sell their products through its platform, gaining visibility and an opportunity to increase their sales.

But Amazon is using a strategy that many people are not noticing: it has the data on what really interests customers and what sells best, so Amazon keeps making its catalogue of own-brand products bigger.

There will come a time when Amazon has practically the same sales in its own products as in third-party products.

Amazon has changed the shopping experience and made people trust the security of buying online, even though for a long time this came at the cost of making hardly any profit, something that is gradually changing.

In sales and profits, Amazon has not yet reached even 30% of its potential (in my opinion).

It is also entering different sectors and services, and it is testing the sale of food products. For now, at least in Spain, these are only non-perishable products, but as it expands its infrastructure, Amazon will become your supermarket.

Later on, it could even create its own delivery company so it does not depend on third-party carriers and can cut delivery costs, although subcontracting this task may be more profitable for it. In fact, Amazon is testing product deliveries by drone.

It is a company that never stops innovating and making shopping easier, and so it is another candidate to pass a trillion dollars in market capitalisation.

(See: Jeff Bezos’s letter to Amazon shareholders that should inspire companies)

3. Apple

What was once a desktop computer company ended up striking a vein of profitability in other kinds of products (iPad, iPhone, iPod…).

(See: How Apple arrived at the “i” in its products)

We know that the legendary Steve Jobs was constantly dissatisfied and paranoid about secrecy in his future projects, but I am sure that Apple’s store of ideas and projects holds several surprises for the future.

Even so, with its current products alone, its high profit margins, and bearing in mind that Apple is a company that has fans rather than customers, it is guaranteed a place among the 3 most valuable companies on the planet.

Will it be the car of the future? Will it be another product as innovative as the iPod was in its day?

Apple is another company with enough capital to buy practically any company it fancies, so one day we might get firm news that Apple or Google is acquiring Tesla (the closest thing so far to the car of the future), although it would make more sense for Google to make that purchase.

What about Facebook?

For me, Facebook is a big unknown. It is clear that, even with all the capital in the world, no social network could emerge today to unseat Facebook, nor a messaging service to unseat WhatsApp. At least in the next 5 years that is not going to happen.

Facebook’s strategic acquisitions suggest that this company is here to stay and has ways to keep increasing its revenue.

The problem I see with Facebook is that it wants to be a very closed platform. In other words, Facebook does not really want you to post YouTube videos. It prefers you to upload your video directly to its platform. It does not want you to post a link that sends your followers to blogs; it wants you to publish the content directly on Facebook so that users never have to leave Facebook.

The problem with this? Facebook does not want to “reward” content creators. Unlike Google, which gives everyone the chance to make money from their creations, Facebook wants those creations but does not give creators the chance to earn money from them. What’s more, if you want your posts to reach all the fans of your Facebook page, you have to pay.

Even so, there is no denying that Facebook has changed the way we communicate, both personally and in business, although it also runs the risk of becoming nothing more than a database of potential customers where companies bombard you constantly with their offers.

All this is just my humble opinion.

See also: 5 business lessons you should never forget

Featured image: Dietmar Rabich, CC BY-SA 4.0, via Wikimedia Commons.