Disruptive technology in practice: From satellites to your road and home
In this webinar, Audun W. Iversen and Emilie Engen, managers at DNB Disruptive Opportunities, along with Jorgen Mork, provides an updated overview of how artificial intelligence, autonomous systems, and energy needs affect both the economy and investment opportunities. The topic is particularly relevant now, as several technologies appear to be moving from the development phase to broader commercial use.
A fund for major structural shifts
DNB Disruptive Opportunities was established in 2019, with a clear investment idea: to identify companies that can benefit from technologies that change how work, production, and value creation are organized. According to Audun and Emilie, this largely concerns machines – both digital and physical – that take over tasks previously performed by humans, either with their hands or their heads.
Since its inception, the fund has experienced significant fluctuations in value, which is also part of the strategy. The portfolio managers emphasizes that the fund is not intended to constitute the entire portfolio for most investors. At the same time, the history shows that the strategy has provided high returns over time.
Since its inception, the fund has delivered nearly 19 percent annual return on average, despite periods of significant market turbulence.
When new technology takes off
A central part of the management team's work involves assessing where in the development cycle various technologies are located. Audun describes this through a simple model of technology maturation: New solutions often take a long time to get started, before they are suddenly adopted at a rapid pace when they become good, stable, and affordable enough. Historical examples illustrate the point.
Four technologies in focus
Audun and Emilie highlights four technology platforms that are particularly important moving forward. The most mature is artificial intelligence in the form of digital agents – software that can perform tasks independently, write code, and collaborate with other systems. This area has been a significant contributor to the fund's development over the past year and has also led to substantial investments in AI infrastructure.
Self-driving technology is considered the next step. In parts of the USA, driverless cars are already in operation, and in Europe, regulatory processes are underway that could open the door to broader use. According to Audun, the technology is largely ready, and what remains are approvals. Once these come through, adoption could happen quickly.
Humanoid robots are still in an early phase. The fund has therefore chosen to take small positions in suppliers that provide components, rather than heavily investing in end products. A potential turning point could come as early as later this year when new generations of such robots are demonstrated in practice.
The fourth platform is voice control and natural language, which makes it possible to communicate directly with machines. This lowers the threshold for use and can change how both consumers and businesses interact with technology.
Energy as a limiting factor
A recurring concern in the webinar is access to energy. Data centers and AI solutions require increasingly more electricity, and several projects in the USA are already delayed because the power grid lacks capacity. This has led to increased interest in alternative energy solutions, including local power systems and off-grid solutions.
Audun points out that energy could become the most significant bottleneck for further technological development, while also opening up new investment opportunities in infrastructure and energy production.
A market in motion
Despite geopolitical unrest, interest rate uncertainty, and short-term fluctuations, Audun believes that the long-term technological trends remain intact. Valuations in many leading technology companies are currently significantly lower than during the dot-com era, while earnings growth is strong.
