It is a well known piece of trivia that of the companies which made the Fortune 500 list in 1955, only around 2% were still on that list in 2014, with 88% of the companies in question having gone under, merged, or just shrunk to the point where they don’t make the list anymore.

Sometimes entire industries can change shape or become irrelevant due to new inventions. On the other hand, entirely new industries can be created as a result. The rise of ever more powerful computer hardware and ever more ingenuous computer software, for example, means that some of the world’s largest publicly traded companies are tech-based.

For an equities investor, the dream is to get in on the ground floor of a company which subsequently then hits the big time. But for every company which makes it, there are thousands of others which don’t – and perhaps even worse, there are some which rise, only to fall back to earth again. Let’s have a look at some examples of both winners and losers in the technology sphere:

 

Winners

  1. Apple – If not for their amazing comeback from the early 200’s onwards, Apple may well have made the second part of this list rather than the first. The 90’s were a grim period for the company which had made its mark in the 80’s with products like the Mackintosh. But the return of ousted CEO Steve Jobs, followed by the staggering success of both its music business and its smartphone line, saw Apple stock soar, going from around $20 in mid 2007 to around $94 right now (with a high of 132.54 in May of last year).

     

  2. Microsoft – Everyone knows Microsoft, just as everyone knows the world’s richest man, who started it. Founded in 1975, the firm’s high point in terms of its share price was late 1999, when it touched 58.72 (making Bill Gates the world’s first – and to date only – Centibillionaire). The firm suffered a relatively lean period in the 2000’s, as they fell behind firms such as Apple and Google on multiple fronts. But so far this decade they’ve been enjoying something of a comeback, with the share price late last year almost reaching that all-time high hit pre-millenium.

     

     

  3. Facebook – Most people only heard of Facebook around a decade ago, when the social media company began to expand beyond University campuses. Since then, however, the social media company has grown to become one of the world’s best known and most widely-used websites. Though the stock price originally dropped in the period after the company went public in 2012, it’s been on a generally upward trajectory since mid-2013: at 119.49, Facebook stock is worth more than three times the 38.23 figure it traded at on its very first day.

     

  4. Amazon – In terms of share price, Amazon has been something of a late bloomer. Nearly static during the first 13 years after it went public (in 1997), the company stock has been rocketing upwards since 2010, despite the firm very rarely registering profit. That’s because CEO Jeff Bezos usually re-invests any profits right back into the company. The firm’s expansion into further markets (such as its consumer electronics and online video offering) has moved it well beyond its original focus on selling books. It has become an online marketplace perhaps unequalled in the Western world. From being worth just $1.73 when it launched, Amazon stock is now worth $673.95.

     

  5. Google – Now trading under the name of newly-created parent company Alphabet, Google is the ultimate dot com success story, the search engine which went on to eclipse all others, making the company one of the most powerful in the world in the process. Starting at just above the $50 mark when it floated in 2004, Google (Alphabet) Class A stock is now trading at around $725 – and most of the investors who got in at the ground floor are multi millionaires today – those who aren’t billionaires, of course.

 

Losers

  1. Palm – Time was when every businessman had a mobile phone – to make calls – and a Palm Pilot as a handheld computer/organiser.

    Then, of course, phones were developed which could do both at once. Suddenly, business people were walking around with Blackberries; and Palm’s sales figures fell off a cliff. Despite several attempts to reignite the company, it was eventually sold off to HP in 2010.

     

  2. Blackberry – The company that helped speed up Palm’s demise found itself on the receiving end not so long after. Though Blackberry was the main product, the company in question was called Research In Motion (RIM) right up until 2013.

    Time was when every serious business person carried a Blackberry, holstered at their hip in a leather sheath attached to their belt. But the rise of both the iPhone and Google’s Android operating system, combined with several high-profile outages of the Blackberry system, led to a collapse in the company’s US market share.

    In September 2010, 37% of US smartphone users were using a Blackberry. Just 5 years later, Blackberry’s market share was at 1.2%, with iPhone on 44% and phones using Android on 51.6%. Blackberry stock, however, had peaked far earlier, in July 2007, at 230.52. It’s now trading at just 6.58.

     

  3. Nokia – Nokia actually started life over 150 years ago, as a pulp mill. However, they are best known for their mobile phones, with a period of dominance in the mobile phone market spanning from around 1998 until around 2003/2004. Many of Nokia’s phones were prized for their simplicity and durability (such as the 3310 and 1100), but a look at their share price chart shows the devastating effect that the launch of the iPhone had on Nokia – it’s been on a downward trajectory for the last nine years. Microsoft finally purchased Nokia’s mobile unit in 2014, leaving the company free to focus on other parts of their business. However, it would appear as if the Nokia phone story isn’t over just yet – just this past week it was announced that newly formed Finnish company called HMD has signed a deal with both Nokia and Microsoft to start manufacturing Nokia smart phones and tablets.

     

  4. Yahoo – At one point the internet’s number one search engine, Yahoo’s decline has been well documented over the years. Its highest point, interestingly, was on the final day of the last millennium; it touched 108.17 on December 31st 1999. Just a year later, the stock price had collapsed to 15.03.

     

    The one bright spot in Yahoo’s history was their farsighted purchase of a significant portion of Chinese online retailer Alibaba. When the company floated on the New York Stock Exchange in 2014, it broke all records, becoming the world’s largest IPO. Yahoo netted billions of Dollars  from Alibaba going public, sparking hopes of a company renaissance which were reflected in the company’s resurgent share price (hitting 51.75 in November 2014) – the highest since 2000.

    Unfortunately, the company has since then been dogged by claims of mismanagement, with numerous staff abandoning a ship that may not be sinking but certainly appears leaky. Yahoo stock is currently at 37.27.

     

  5. Pets.com – One of the defining tales of the dot com bubble was Pets.com. The shortlived company (it operated from 1998 to 2000) went into liquidation just nine months after its IPO. Pets.com was a prime example of how a high-flying marketing campaign isn’t much use if you don’t have a clear and effective business model (due to the nature of the merchandise being sold, the company found it close to impossible to make a profit). The Pets.com share price had been $11 – on the day of its liquidation, it was just $0.19.

 

So there we have it, some of the biggest technological success stories and cautionary tales of the last few decades. Which of today’s fledgling firms will become superstars; and which will be consigned to the scrapheap? We’ll have to wait and see.