successful investing in any nascent industry can be summed up as

1. where along in the S-curve are you (is it inflecting positively? is each incremental datapoint de-risking the overall %'s of success?)

2.can you ward off competitors, preventing a mean reversion in ROIC and possibly increase margins/ROIC's (in 100% digital-companies it's the 'escape from base rates')

3. valuation. Valuations matter (... eventually). Maybe not today, this week, this year, or the next. But ultimately, as S-curves and industries mature, fundamentals will be main drivers of stock performance. the valuation in growth stocks are driven by its terminal value

(likely 80%-100% or even >100% if co. is FCF neg) hence acceleration/deceleration in growth rates + change in (perceieved) terminal margin %'s result in huge changes in stock px

when it comes to growth investing, half the job is figuring out "which industries will grow," and thats the easy part (see airlines, hardware, weed stks, etc). The other half is figuring out which companies have competitive advantages that will endure (won't elaborate here)

on shorting stocks

assessement of AWS in 2018

more on inflection points..

Alex Sacerdote from Whale Rock

source: https://medium.com/graham-and-doddsville/alex-sacerdote-of-whale-rock-capital-ee46fcbfd8eb