How Smart Investors Beat the Dot-Com Bust

At the turn of the millennium, investors were convinced the internet was an unstoppable gold rush. Companies with little more than a catchy name and a domain were going public, and valuations soared to levels that had no relationship to reality.

Few captured that mania more than Pets.com.

The company raised hundreds of millions of dollars, bought a Super Bowl ad, and plastered its sock-puppet mascot across television screens.

In February 2000 it hit the public markets at $11 a share, promising to reshape how America shopped for pet supplies. But its model was fatally flawed. Shipping 40-pound bags of dog food to customers’ doors cost more than the revenue they brought in.

By November of the same year, just 268 days after its IPO, Pets.com had collapsed into bankruptcy, its shares worth pennies, its mascot reduced to a cautionary tale of a bubble gone bust.

While investors chasing mascots and dot-com dreams were wiped out, another group of companies quietly endured. Utility stocks. Duke Energy, Southern Company, Consolidated Edison — the boring providers of power and gas that nobody bragged about at cocktail parties. Their shares barely moved during the collapse, and dividends kept rolling in.

As the Nasdaq shed nearly 80% of its value, utilities lost a fraction of that and in some cases gained. Essential infrastructure did not need hype. It simply worked.

Fast forward to today.

The talk is all about the “AI bubble.”

Investors are piling into front-end names with soaring valuations, convinced this is the only trade that matters. We have several AI plays in our portfolio that are performing handsomely.

But history is rhyming. Just as the internet frenzy created enormous hidden demand for bandwidth and electricity, AI is creating a strain on the grid that consumers are just beginning to talk about.

Data centers already consume power at the scale of small cities, and demand is set to triple in the years ahead.

Artificial intelligence does not run on optimism. It runs on electricity…and an aging grid.

Once again, companies are stepping up to supply essential infrastructure and the stocks may not be on your radar….but they should be.

Our Top 3 AI Power Plays are poised to benefit from soaring power demand

• Rapid on-site power: A provider building modular fuel-cell systems that can be deployed in 90 days, giving data centers a way to keep running when the grid cannot keep up.

• Always-on renewable supply: A geothermal leader delivering clean baseload energy, tapping into the Earth’s heat to provide uninterrupted power for AI workloads.

• Next-generation nuclear fuel: The only domestic source of advanced uranium enrichment, critical to fueling small reactors designed to meet future AI-driven demand.

These are the kinds of companies that history rewards.

The hidden backbone plays. The ones investors overlook while chasing the mascots of the moment.

AI isn’t the only driver; the reality is that society is on a one-way path to using more power.

We walked through all three of these “AI Power Plays” — how they work, what is driving their growth, and why they could be the biggest beneficiaries of the AI megatrend — in our Founders Call today.

Watch below: