The rivalry got so intense that it earned its own name…
“The Cola Wars.”
Coke versus Pepsi.
You don’t hear about it as much as you used to, but it’s still there, even if not at the same level as in the 1970s and 1980s especially.
Coca-Cola (NYSE:KO) was formed in 1896, and PepsiCo (NASDAQ:PEP) began just six years later … though Pepsi-Cola goes back to 1898 and its original name of Brad’s Drink (after Caleb Bradham, the inventor).
In the 1980s, Pepsi gained ground through its famous Pepsi Challenge marketing campaign, which featured blind taste testers who preferred Pepsi over Coke. Coke responded with one of the biggest duds in history … the introduction of New Coke in 1985.
Through it all, both companies thrived and made investors money.
Rivalries can be great for business and for investors. We have a growing one right now that takes things to new heights, so to speak. And with it comes big potential…
If you look at Coke and Pepsi today, you see two massively successful businesses.
PepsiCo ranks 44th on the list of Fortune 500 companies, and Coke is 93rd.
Both have market capitalizations over $200 billion.
And both have made investors a ton of money. Here’s what they did from 1975 to 1990 when the rivalry was at or near its most intense…
I’d take that, and I’m sure you would, too.
Fast forward to today … literally right now … and we have an “out of this world” rivalry among some of the world’s richest, most innovative, and most successful entrepreneurs.
It may not be the next Cola Wars, but it is the next great Space Race, which will see us constructing new worlds in the sky … and creating trillions of dollars in wealth.
The first Space Race pitted the United States against the Soviet Union during the Cold War, culminating in the U.S. successfully landing multiple missions on the moon.
Here in July of 2021, we have not one but two billionaires blasting into space.
Sir Richard Branson, the colorful founder of Virgin Group — which includes Virgin Galactic Holdings (NYSE:SPCE) — blasted into space more than 50 miles above the Earth and returned safely on Virgin’s Spaceport America.
This wasn’t some quiet test launch either. The event was livestreamed with Stephen Colbert as the host. Musician Khalid performed afterward. It was a big party.
What’s more, Branson announced he would go into space on July 11 after Amazon (NASDAQ:AMZN) founder Jeff Bezos announced he would rocket into space on July 20 … one week from today.
Branson said he wasn’t trying to beat Bezos into space. (Suuure.) And Bezos hasn’t commented on Branson’s flight.
But that hasn’t stopped at least a little bit of trolling between Virgin and Blue Origin, which is Bezos’ space company. Blue Origin pointed out that Branson’s flight went about 55 miles into the air, which is below the Karman line at 62 miles up that is recognized by many as the divider between upper atmosphere and space. Bezos will go beyond that. On the other hand, Branson’s flight lasted longer than Bezos’ is expected to.
And let’s not forget Elon Musk, the equally colorful founder of Tesla (NASDAQ:TSLA) and SpaceX, which has already carried astronauts to the Space Station. If you know anything at all about Musk, you know he doesn’t dream small. His company aims for a three-day trip to space in September, and his ultimate goal is to colonize Mars. Yep … Mars.
In fact, Musk showed up at Branson’s house at 3 a.m. the morning of his flight. One was getting up and the other hadn’t been to bed. I’ll let you guess which was which.
Musk has also put down a $10,000 deposit for a ticket on one of Virgin’s future flights. The ultimate price will be a mere $250,000. He’s in good company here. Tom Hanks, Lady Gaga and Justin Bieber have done the same.
It’s fun to talk about eccentric billionaires, but the implications go way beyond that. We are now in a new space race that will result in a new space economy. And like space itself, it is going to be big.
By the end of the Roaring 2020s, Bank of America predicts the space industry will more than triple from today’s value to $1.4 trillion.
The key that opens up this opportunity is a recent game-changer in space exploration — reusable rockets.
Up until now, rockets were a one-and-done proposition. At billions of dollars per unit, you can see why missions were few and far between.
Reusable rockets have already lowered the cost to launch a satellite into orbit by 70% — from $200 million to about $60 million. Costs should continue to decline and could be as little as $500,000 in the future.
Lots of people, including some of the smartest and wealthiest people in the world, believe that space offers the best investment opportunity of the coming decades.
Count me in. I really do expect this next space boom will see us constructing new worlds in the sky … and create trillions of dollars along the way.
On the date of publication, Matthew McCall did not have (either directly or indirectly) any positions in the securities mentioned in this article.
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