Investing for retirement means setting aside some cash now, in the hopes that it will be worth much more in 20 or 30 years' time. Some of the larger companies in Australia might not grow very much in that time, but smaller businesses remain a fruitful hunting ground for the growth-seeking investor.
Here are two companies that I think could become much larger over the next decade:
Greencross Limited (ASX: GXL)
I took my first good look at Greencross two years ago after reading their presentation to the Macquarie Securities conference. The subsequent conference presentations from the company (one per year) have also been valuable and the most recent one was no different – all prospective investors should read it.
Anyway, Greencross controls around 9% of the Australian pet retail market and hopes to grow this to 20% over the medium term. It will do this via acquisition of vets and retail stores, establishment of in-store vets, and expansion of its own private label products including pet food. The company has a well-articulated strategy that is delivering results, and I would consider buying shares below $7.
Nearmap Ltd (ASX: NEA)
Nearmap Ltd is a provider of aerial imagery to businesses like insurers and construction companies, with its highly-detailed images saving the costs of site visits. Adding new features to its software has been an important driver of additional sales, and the addition of new types of customers outside the insurance and construction industries suggest that there is untapped demand for these images, which can be used in surprising ways (e.g. planning new routes for a food truck business).
Either way, Nearmap is well funded and has been growing successfully despite competition. Currently the company controls an estimated 15% of the Australian market and less than 1% in the US market, where it has been winning new business. It could become much larger over time and I have previously purchased shares at today's prices.
