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Are You Sleepwalking Into Trouble?

You wake up one morning and find that your best-laid plans have gone awry. It can happen all too frequently.

But what do you do about it? Have you got a Plan-B that you can implement straight away? Do you even have a Plan-B?

At the commercial level, many businesses, both here in Singapore and abroad, are being disrupted. They are sleepwalking into disaster. They don’t have a Plan-B, let alone a Plan-C, D or E.

They thought that nothing could possibly disrupt their protected revenue streams, their almost-guaranteed cash flows and safer-than-safe dividend payments to shareholders.

That is until it does. By then it could be too late to do anything about it.

Wake-up call

At last year’s FoolFest 2016 – the annual event for Stock Advisor Gold members – we heard venture capitalist, Peg T. Ong, speak passionately about disruption.

Peng was one of the founders of Match.com. He is now a venture capitalist who invests in start-up disruptive businesses.

There was something that Peng said during his Question & Answer session that sent a shiver down my spine. For me it was a timely wake-up call…

… It probably saved me from making some big investing mistakes…..

….He said that disruptive companies disturb over-bloated, inefficient industries by creating new, smaller businesses that make better use of available capital.

But as a consequence of the disruption, billions of dollars of value – probably unwarranted and undeserved value – could be destroyed.

Value destruction

That is the price we pay for disruption. That is also the price we might pay as investors, if we have put our money into those companies.

For instance, ComfortDelGro (SGX: C52) has lost almost a third of its value in the last two years. Who would have thought that was ever possible? Those blue taxis were a hallmark of Singapore’s transportation sector. But their numbers are dwindling. Value has been destroyed.

The market value of Singapore Press Holdings (SGX: T39) has almost halved. That seemed almost impossible, too. There was a time when a morning copy of The Straits Times or The Business Times was required reading before the start of any new day. But it’s not anymore. Value has been destroyed.

Peng’s shocking revelation provided the inspiration for this year’s annual gathering of Stock Advisor Gold members, namely FoolFest 2017.

Scan-and-scram

This year we will be looking in depth at disruption. We will be hearing how shopping malls are fighting back against online shopping. Is there anything that retailers can do about consumers who simply visit shopping malls only to scan-and-scram?

We hope to find out when a leading figure in the retail REITs sector will provide the low-down on the winners and losers in shopping malls.

What about remisers and brokers? What indeed?

Are their days of exorbitant charges numbered? Low-cost broker are now a feature of many markets around the world, apart from Singapore. But one man has high hopes of changing all that.

He has already put the frighteners up existing Singapore brokers. We hope to find out more, when I and the audience will put him under the spotlight. Can he really change the way that we buy and sell shares.

Painless payments

And finally, we will get a chance to hear from a budding entrepreneur who has succeeded in not only changing the way we pay for things but make money out of it too.

Her idea was so head-slappingly simple that I had to invite her to speak at FoolFest 2017. I am told she also has a treat in store people in the audience.

Imagine paying absolutely nothing for a business-class ticket, simply by doing what you have to do anyway – pay your annual income tax bill. For once I can’t wait to hear from IRAS.

I hope to bring you more about what we learn from this year’s FoolFest 2017. But for now, I am dreaming about my trip to Tokyo thanks to the taxman.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore Director David Kuo doesn’t own shares in any companies mentioned.