Not surprisingly, many fast-growing companies are from the tech industry – here, scaling up business models can be a lot quicker than in many other areas. If a software company has developed a new helpful tool, it doesn’t really matter cost-wise whether they sell it to 10 or 10,000 customers. Scaling up a company that manufactures things in large and capital-intense manufacturing plants is a lot harder to scale up profitably.

Also, finding something entirely new in the tech area is easier than in more established, “old-school” areas, such as refining or farming, as things are moving a lot faster in tech and technological progress allows for the introduction of new products that were technologically impossible just a couple of years before.

When it comes to relative growth rates, size also plays a role. If a company generates $10 million in revenue per year, doubling that revenue requires adding “only” $10 million in sales in the following year. A company that generates hundreds of billions of dollars in sales, however, would have to add a gigantic number of new customers to double its revenue. That’s why today’s Apple (NASDAQ: AAPL) doesn’t have the high growth rate that early AAPL did.  

One of the most interesting, fast-growing companies today is Oura. This Finnish company manufactures smart rings that provide all kinds of data, similar to what an Apple Watch does:

The company, founded just a decade ago, has sold more than a million rings already and continues to see explosive growth in interest by consumers. It just finished a Series D round of funding, so it isn’t public yet, but it’s worth watching.

Anthropic is another very fast growing company. This California-based AI business has developed a Large Language Model (LLM) with a  focus on it being safer and more accurate than competing LLMs, which has resulted in massive interest and hefty funding, including a ~$10 billion Series D.

Scale AI is another tech company from the AI universe. Scale AI provides training data for AI applications, and with many AI companies seeking to grow their business and their investments, Scale AI’s data is in high demand, resulting in strong growth and a recent $1 billion Series F funding.

Many other very fast growers include Preply, a language tutoring business, Gumroad, where content creators can sell their content, Codeium, an AI coding assistant, and so on.  

Benefit from the Newbies Growth

Many of the companies with extremely high relative growth rates aren’t traded publicly, as they’re either still owned by their founders, or they’re owned by venture capital funds, private equity, and so on. Also, if they’re not profitable yet, they make for riskier investments.

Still, you can benefit from the growth of many of these fast-growers in a different way. They need technology, services, and so on in order to grow their business. This is where publicly traded companies come in.

NVIDIA (NASDAQ: NVDA) is a great example of a direct beneficiary of the growth of ultra-fast growing, private, smaller companies. NVIDIA does a lot of business with all kinds of tech companies, as they all require computing power in one way or another. A very fast-growing artificial intelligence (AI) company, such as Perplexity AI, for example, needs access to powerful chips, and that’s where NVIDIA comes into play.

Many other fast-growing AI companies also either need chips from NVDA or need high-end chips to expand the AI universe, which fuels the growth rate for AI chips and other related products. NVDA and other AI data center beneficiaries will benefit from that.

Broadcom (NASDAQ: AVGO), QUALCOMM (NASDAQ: QCOM), and Arista Networks (NASDAQ: ANET) are some of the other beneficiaries of the extreme growth small tech companies are generating. Investors can choose among our Artificial Intelligence picks to benefit from broad, long-term, AI-driven trends, which is how some of these small up-and-comers will end up MegaTrend juggernauts someday.