*By Carlo Versano*
Once every decade, there's a seismic shift in technology ー usually in the form of a new innovation ー that reshapes how we live, said venture capitalist Gene Munster.
"There's always little waves going on in tech, but every 10 years or so there's a big wave that hits," Munster, a managing partner at Loup Ventures, said Wednesday in an interview on Cheddar.
There was the smartphone in the mid-aughts, following the widespread adoption of the world wide web. Before that, the PC. Munster said we're now in the early stages of the latest changes in tech: the emergence of A.I., robotics, autonomous vehicles, and augmented and virtual reality. Our lives, he said, will be manifestly different. And Munster's firm recently launched a new ETF to expose investors to that theory.
The Loup Frontier Tech ETF will contain a basket of relatively small, highly innovative tech companies with market caps in the $500 million to $2 billion range, Munster said. [The fund](http://www.innovatoretfs.com/pdf/LOUP_Factsheet.pdf), which launched in late July, was built to reward companies with revenue growth and positive cash flow.
For now, Munster wants to prioritize smaller stocks, but there's one major exception: the ETF does hold shares of Tesla.
Why does the $50 billion-plus company fit the strategy? Munster said Tesla, despite its public dramas, has "the greatest product road map of any tech company." He added that CEO Elon Musk has built a business that is uniquely positioned to leverage renewable energy, the storage of that energy, and the combined trends of zero-emissions and autonomy in automobiles.
Munster's belief that virtual and augmented reality are technologies that will "fundamentally change how humans interact with each other" is not widespread ー VR, after all, has struggled to gain broad adoption, and Snap, which built its first app on the basis of AR, has seen its share price cut in half since its IPO last year. But the Loup Frontier Tech ETF includes stocks like Micron Technology, which makes chips for VR headsets. That kind of diversification ー plays on gaming and autonomy side by side ー is what distinguishes his ETF holdings from typical sector-based funds, Munster said.
One tech giant which may be marking its own seismic shift is Apple. Munster, who was previously a top analyst of the stock at research firm Piper Jaffray, believes the company is on the verge of transitioning from a hardware operation into a service-based company with its App Store, Apple Music, and iCloud. That change will propel the stock higher as investors shift from a "boom-bust" mentality based on the product cycle to a more solid conception of "Apple as a Service."
And what about Apple, flush with all that cash, making a play for Tesla?
Munster said it isn't out of the question. Both companies have a shared ideology based on a love of design; and Apple has long been trying to enter the EV market with its Project Titan electric car.
"It's always been a fairy tale that Apple and Tesla are going to find a way to get together," he said.
For full interview [click here] (https://cheddar.com/videos/gene-munster-captures-tech-growth-with-new-etf-launch).
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