The ability to expand without huge sums of money and their stash of consumer data are key draws
As jitters rocked Wall Street over the political turmoil engulfing United States President Donald Trump last week, there was barely a reaction in Asian markets.
Instead, what grabbed traders' attention was the stampede into Hong Kong-listed mainland Internet giant Tencent Holdings, which recorded a 58 per cent jump in its first-quarter profit to 14.48 billion yuan (S$2.9 billion).
The resulting run-up in its shares caused Tencent to hit an intra-day record high of HK$271 and a market capitalisation of HK$2.6 trillion (S$463 billion), catapulting it to among the top 10 most valuable firms in the world.
Even so, some investors may not have heard of Tencent, but many would have been familiar with its mobile chat service WeChat that now has nearly one billion active users a month.
Like US tech giants Alphabet (Google's parent) and Facebook, Tencent has been enjoying a sharp run-up this year. The stellar results confirm that its winning streak is likely to continue for now, despite persistent concerns from some quarters of a slowdown in China's growth.
One common trait shared by all these firms is their ability to deploy far fewer assets and human resources than the traditional bricks-and-mortar companies to expand their businesses once they have achieved a certain scale in their operations.
What is interesting to note is that at the recent shareholder meeting of Berkshire Hathaway, its boss - the legendary investment guru Warren Buffett - bemoaned the fact that he failed to spot these winners early on and invest in them.
Mr Buffett has remained true to his lifelong philosophy of investing only in what he can understand, but admitted that he should have understood Google.
Berkshire's auto insurance unit, Geico, had been an early customer of Google and had to pay the search engine US$10 (S$13.90) to US$11 per click on its ads, which explains Mr Buffett's anguish in failing to spot the trend. As he observed: "Any time you're paying somebody US$10 or US$11 when somebody just punches a little something which has no cost at all, that's a good business and you have never seen a business like it."
So one reason to want to buy these tech firms, based on Mr Buffett's investment philosophy, is the sustainable moat they have created for themselves to enable them to scale up their business without requiring huge amounts of capital.
But the more important reason to want to get our hands on them is the fabulous treasure trove of consumer information they have built up on shopping, eating, travelling and wealth.
The Economist magazine recently described data as the most valuable commodity in the economy we live in, giving enormous power to the companies with access to it.
As it observed, any time a person goes for a run, watches TV or even sits in a car, he leaves a digital trace. And as more devices from watches to cars are connected to the Internet, that generates even more data. By collecting more and more data, a firm has more scope to improve its products and attract more users which, in turn, generates even more data.
The access to data also acts as protective moats against encroachment by other firms eyeing their turf, enabling them to head off any potential rival early on, or an unexpected technological shift which may hurt their business.
The Economist notes that this gives them a "God-eye view" over their markets and beyond. "They can see when a new product or service gains traction, allowing them to copy it or simply buy the upstart before it becomes too great a threat," it said. This helps explain why Facebook was willing to fork out such a big sum - US$22 billion - to buy the messaging service WhatsApp in 2014 even though it had no revenue to speak of.
However, one worry is whether these tech firms are becoming too big for their own good, leaving our economy dominated by a few Internet giants with the means to control every aspect of our lives.
So far, their dominance hasn't worked out to the detriment of consumers. In fact, many services offered by the likes of Google, Facebook and Tencent are free.
I am confident that even with their access to data that provides them with barriers against potential rivals and early warning systems, the market is still sufficiently big and fragmented enough for a fresh company to capture a big slice.
So far, the successes of companies such as Tencent and Alibaba are mostly confined to China, even though they are making enormous efforts to make inroads outside their home turf.
The success of upstarts like Snapchat suggests new entrants can still make waves, despite the dominance of Facebook in social media networking.
And the ever-cleverer ways in which data is being mined means that we may find ourselves landed with a host of new products we may not even have thought of.
Just look at the app economy launched by the smartphone revolution. Even Apple's late boss, Mr Steve Jobs, might not have grasped the enormity of the changes which he had unleashed.
Stock exchanges get their bread and butter business from earning a fee in clearing the trades on the stocks listed on them - and one of their priorities is to attract as many of these potential winners as possible.
There is one other lesson from Tencent: Unlike Facebook and Google, which have more than one class of shares because such a choice is available in the US, Tencent has only one class because the Hong Kong stock market does not provide for a multiple share structure.
Yet, despite this purported handicap, founder Pony Ma has been able to grow his firm to become one of the most valuable on the planet, and doing so without the fear of being taken to task for making tough decisions by shareholders hell-bent on short-term gains.
It runs contrary to the argument that dual-class listings are a necessary evil in order to get big tech start-ups to list because their founders may be worried that they will end up pandering to the mood swings of short-term investors rather than focusing on long-term performance.
With a market value of over $460 billion, Tencent is now worth almost half as much as all the companies listed on the Singapore Exchange, even though it has been listed for only 13 years.
It underlines the big challenge faced by bourses everywhere to attract these winners early enough, if only to stay relevant to investors who trade in them.
For investors, the world is truly their oyster. Making wagers on companies shaping our future will require them to go far beyond the confines of their home market.
We have been experiencing some problems with subscriber log-ins and apologise for the inconvenience caused. Until we resolve the issues, subscribers need not log in to access ST Digital articles. But a log-in is still required for our PDFs.