If you follow the calls that Kris Sayce and I make in Australian Small-Cap Investigator, you’ll know that we like to see a government keep its nose out of a company’s business.
Governments and the public servants who steer them tend to act in their own best interests. Those interests rarely align with those of the taxpayers who foot the bill.
Some industries are certainly worthy of public support. High technology is one of them.
Some high tech companies’ ideas are so far-fetched that private investors refuse to touch them with a barge pole. But if these firms can access early-stage public funding, they get a shot at growing into the small-cap stars of tomorrow.
Kris and I love to pick these stocks before everyone else. In fact, at least two of the small-cap stocks on our buy list grew out of government labs.
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Even when government backs a good idea, you can generally rely on it to find a way to stuff things up.
But here’s the good news…a public servant’s losses can be a private investor’s gains.
Take, for example, Campbell Newman’s treatment of Brisbane-based tech start-up Imagus Technology.
My mate Shae Smith told you about Imagus last week. I love it.
If you missed Shae’s eletter, Imagus has developed a facial recognition app. Imagus can wire this app into Google Glass-style spectacles. It lets you match faces you see through the specs in real time with faces in a database.
This Aussie tech is the cutting edge of augmented reality (AR). The app is smarter and the output more useful than what you get with Google Glass. Imagus can link this tech into glasses — pictured below — that don’t get in the way of your ability to actually see.
Source: SMH
By the way, that’s not Sam in the photo…just a close lookalike!
The American army’s top brass are keen to get their hands on Imagus’ product.
It would be a perfect fit for the US Defence Intelligence Agency (DIA). The DIA wants to equip its agents with smarter spy glasses.
Last year the worldwide group developing ‘X6’, the last word in high-tech spy glasses, handpicked Imagus to plug in their tech.
X6 won’t release these spy specs to the public…but the DIA has just bought 500 sets.
X6 looks like a massive coup for spooks and secret agents in the field.
You could even see soldiers armed with these gadgets down the track. It will help them make smarter decisions in high-pressure combat settings.
This is a massive win for a tiny Aussie company that has only existed since last year.
But Queenslanders might feel a few sour grapes.
You see, the Queensland government tipped several million dollars into hidden surveillance and counter-terrorism tech after the London 2005 tube bombings.
One of those technologies was the facial detection software that re-emerged through Imagus.
The Newman government pulled that funding in 2012. But Dr Brian Lovell, the driving force behind the tech, was determined to push on through the private sector.
Dr Lovell couldn’t keep the rights to his idea. But he backed himself and re-wrote the source code from scratch. Now his private vehicle, Imagus, is hitting the big time.
I suspect Dr Lovell will earn a much bigger share of the profits this way than if his idea had taken off while it was still under the government’s wing.
And so he should. Dr Lovell’s attitude should serve as a beacon to Aussie company founders and speculators. It goes to show that if an idea is worth funding, it’s generally worth funding with private money.
The DIA contract is a great win, but Imagus is still very early-stage. I’d love to see the company grow and list on the Australian Securities Exchange (ASX). You could back both Imagus and yourself…and get a piece of the action.
That day won’t come for a while. But heavyweight tech companies have already shown a clear path to market for AR gadgets.
Apple Inc [NASDAQ:AAPL] and Google Inc [NASDAQ:GOOGL] will both watch Imagus closely as it develops.
Each tech titan folds cutting-edge ideas into its hardware and software to attract customers to its ‘ecosystem’.
Apple and Google spend millions, if not billions of dollars, finding ways to mesh their products ever more closely with the user.
Google Glass is the clearest example of what can come out of these programs.
You might scoff at the idea that the average Aussie could one day comfortably wear a computer on his or her face. But you can bet that Apple and Google are testing ways to expand our reality through less obvious means.
Think about the scope for apps that give tourists real time advice about their surrounds. These apps could overlay comments from other visitors and translate foreign signs and menus.
Surgeons could even use this tech to see inside patients’ bodies like never before. AR could combine medical imagery with videos and ultrasounds to let doctors save more lives. The company that gets that idea off the ground will make a mint.
These kinds of ideas, much like Imagus’ facial detection tech, are worth supporting.
The private sector knows that. Sometimes government gets it too…but it just seems to drop the ball at crucial points of the game.
That’s a waste for taxpayers, but an opportunity for private investors.
Cheers,
Tim Dohrmann+
Small-Cap Analyst, Australian Small-Cap Investigator
Ed note: The above article was originally published in Tech Insider.
The post Why This Augmented Reality Tech Is Worth Supporting appeared first on Stock Market News, Finance and Investments | Money Morning Australia.
