Ground-floor opportunities in transformative technologies don't come along often. We're in a unique moment in which two revolutionary sectors -- quantum computing and electric aviation -- are transitioning from research labs to commercial reality. I've identified two companies at the forefront of this transition: IonQ (IONQ -5.72%) and Joby Aviation (JOBY -2.51%).
These investments carry significant risk -- studies show about 90% of early stage technology companies disappear within their first decade through bankruptcy, forced mergers, or buyouts. However, those who succeed in reshaping industries can generate life-changing returns. Let's examine why these two pioneers warrant consideration despite their speculative nature.
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Quantum computing pioneer
IonQ sits at the forefront of quantum computing, an emerging technology that could revolutionize everything from drug discovery to financial modeling. In its third-quarter 2024 results released Nov. 6, the company reported revenue of $12.4 million, representing 102% growth over the same period last year.
More telling than the revenue growth is IonQ's strategic positioning. The company secured a $54.5 million contract with the U.S. Air Force Research Lab in the third quarter and announced partnerships with industry giants like AstraZeneca and Ansys. These relationships validate IonQ's technology while creating multiple paths to commercialization.
The market has taken notice -- IonQ's stock has surged 147% from Jan. 1 through Nov. 26, 2024. This momentum isn't just retail speculation. Security and Exchange Commission filings show Citadel Advisors, led by billionaire Kenneth Griffin, has steadily built a 2.56% stake since early 2021, suggesting sophisticated investors see long-term potential in IonQ's technology leadership.
This institutional confidence aligns with broader industry projections. Fortune Business Insights forecasts the quantum computing market to expand from $885.4 million in 2023 to $12.6 billion by 2032, as quantum systems begin solving real-world problems that overwhelm traditional computers.
Electric aviation innovator
Joby Aviation is working to revolutionize urban transportation through electric vertical takeoff and landing (eVTOL) aircraft. While still pre-revenue, Joby's execution against major technical and regulatory milestones suggests a company methodically building the foundation for a new transportation category.
The company's third production prototype completed successful exhibition flights at Toyota's Higashi-Fuji Technical Center in Japan, according to Joby's Nov. 6 earnings release. That relationship deepened in the third quarter when Toyota committed an additional $500 million investment. This vote of confidence from the world's largest automaker provides both capital and crucial manufacturing expertise.
The broader eVTOL market opportunity is substantial. Analysis from Exactitude Consultancy released Nov. 14, 2024, projects growth from $1.76 billion in 2024 to $24.1 billion by 2031. While Joby's stock has gained a modest 18.8% from Jan. 1 through Nov. 26, 2024, SEC filings reveal Citadel Advisors has been accumulating shares since late 2022 -- a sign that sophisticated investors recognize the company's first-mover advantages in this emerging space.
Taking the long view
My investment approach with both companies focuses on their potential to become foundational players in transformative industries. Both are pre-revenue or early revenue, operating in nascent markets with significant regulatory and technological hurdles ahead. However, their intellectual property moats, strategic partnerships, and expanding commercial opportunities create compelling risk-reward profiles for patient investors.
I plan to continue building positions in both companies over the next five years while maintaining at least a 10-year holding period. This approach provides time for their technologies to mature while managing position-level risk through gradual accumulation.
For investors willing to embrace volatility in pursuit of asymmetric returns, IonQ and Joby Aviation offer rare exposure to potentially revolutionary technologies. While not suitable for core portfolio positions, these early stage growth stocks represent the kind of speculative opportunities that can generate outsized returns when approached with appropriate position sizing and time horizons.
