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A strategy where investments are made in companies that are providers of necessary equipment for an industry, rather than in the industry's end product. A pick-and-shovel play, in practice, could be within the oil industry; an investor would purchase stock in a company that manufactures seismic data equipment that exploration and production (E&P) companies need to find new oil and gas deposits, rather than on the E&P company itself.
“During the Gold Rush, most would-be miners lost money, but people who sold them picks, shovels, tents and blue-jeans (Levi Strauss) made a nice profit.”-Peter Lynch
This is a great investing principle that most people tend to overlook. When you identify a booming industry or stock, don’t forget to look at the companies supplementing that industry. For example, when Apple Inc. (AAPL) became successful with the iPhone, a lot of other companies supplying them with technology and raw materials also made huge money. With EnWave we can make money from all weed producers instead of competing against them.
Cost-Saving, Weed-Drying Machines
a "Pick & Shovels" Marijuana Play
Written by: Trent Blair
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