The speculative end of the market can be notoriously dangerous for investors. A share has just as much chance of going bust as growing by 100% or more.
However, there are certain businesses which I think have less risky business models but could still create fantastic returns for investors:
Fastbrick Robotics Ltd (ASX: FBR)
Fastbrick is developing a robotic truck that aims to build brick walls. A robotic truck alone sounds like an interesting idea, but it's the speed of the truck that could turn it into a product used across the world.
The 'Hadrian X' robot apparently will have the ability to build a wall in a few hours that would take a team of labourers all day.
Global construction companies are taking notice, with Caterpillar taking a $2 million stake earlier in the year.
Bubs Australia Ltd (ASX: BUB)
Bubs is an infant formula business with a difference compared to a2 Milk Company Ltd (Australia) (ASX: A2M). It uses goat milk, which gives it quite a good unique selling point compared to other suppliers at this stage.
Goat-supplied formula has a small market share of 5% of the overall formula market in China, but it's growing rapidly. According to the CEO the goat formula sector is achieving a 50% compound annual growth rate at the moment.
Oliver's Real Food Ltd (ASX: OLI)
The headquarters of major quick-food brands like McDonald's, KFC, Subway and Burger King are all in the USA. However, perhaps Australia is seeing the start of its own power food brand.
Oliver's aims to produce real and healthy food for customers. It is believed to be the world's first certified organic fast food chain. It describes its food as fresh and natural, free from additives and preservatives.
In its quarterly update for the three months to 30 September 2017 management revealed that same store sales had grown by 6.3%, which was better than the prospectus forecast of 5.1%. If this can continue for many years ahead then Oliver's could be quite cheap today, with management confirming guidance of Net Profit After Tax (NPAT) of $2.4 million for FY18.
Foolish takeaway
All three companies could potentially do very well. I think Oliver's is the lowest risk and most likely to succeed, however Fastbrick could truly shoot the lights out if it can create and sell many trucks.
