"You are fishing in a stocked pond if you focus your investing on these companies."

David identifies this trait as the most important.

Let's break it down:

Top Dog = Leader

If you're not the lead husky, the view never changes. - David Gardner

Top Dogs focus on innovation. They determine the direction they are heading and shape the industry they are leading.

Example: Intuitive Surgical introduced robotics into surgery and became synonymous with higher-tech surgery

First Mover

These are the companies doing things that others think can't be done.

Example: Amazon thrived in E-commerce when most doubted customers would put their credit card information online.

Important & Emerging Industry

Identify industries that are shaping the future.

Example: Salesforce shifted the way companies manage their customers to the cloud.

Apply the Snap Test: Would anyone care if you snapped your fingers and the company/industry disappeared overnight?

Examples: Intuitive Surgical $ISRG, Amazon $AMZN, Salesforce $CRM

These companies often look overvalued, so they are overlooked. This means many investors will never own the best companies of their time.

References:

Finding the Lead Husky

Six Traits of a Rule Breaker Stock