Growth investing in 2026: the treasure hunt begins

At a recent industry lunch, I was fortunate to be sitting across from Ten Cap’s Jun Bei Liu, whose enthusiasm for stock picking is boundless. During our chat, she likened finding great stocks to treasure hunting: the treasure is out there, provided you are willing to traverse the plains and wade through the jungle to find it. 

It is a fitting metaphor for growth investing in 2026, because the treasure is still there, but the old map no longer works.

For most of the past 20 years, growth investors have had the luxury of riding some very large and very obvious waves: China’s industrialisation and Australia’s resource boom; the smartphone and platform economy; cloud and SaaS; the post-GFC zero-rate regime; the pandemic e-commerce step-change, which lifted U.S. online sales by 43% in 2020; and now AI and compute. In hindsight, these themes feel obvious. At the time, they were simply where earnings, capital and attention were flowing. 

The era of easy growth

The interest-rate backdrop helps explain why. In December 2008, the US Federal Reserve cut the fed funds rate to 0-0.25%. It returned to that same floor in March 2020. As of March 18, 2026, the target range was 3.5%- 3.75%. 

We are simply not in a zero-rate world anymore, and that means future cash flows are worth scrutinising a lot more carefully.

A narrower market

In the US, by mid-2025, the ten largest companies in the S&P 500 made up almost 40% of the index, a level of concentration not seen since the mid-1960s. 

On the ASX, the opposite problem exists: Australian tech is exciting, but small. According to ASX-published analysis, the constituents of the S&P/ASX All Technology Index represented just 4% of the S&P/ASX 300 as at mid-March 2026, and the sector had suffered six drawdowns of 20% or more since 2014. [2]

So growth is no longer a one-click trade. It is concentrated at the top globally, and thinner on the ground locally than many investors assume. That is why stock picking matters again. 

The easy beta has largely been harvested. What is left is the harder, but potentially more rewarding, task of finding where durable earnings growth turns up next.

Why AI looks different

My suspicion is that the next dominant theme will still be connected to AI, but probably not in the simplistic way the market first assumed. 

AI is an infrastructure story, an energy story, a productivity story and, eventually, a sector-by-sector adoption story. It will impact all asset classes - not just equities - in different ways. 

The numbers already hint at that breadth. Gartner forecasts worldwide AI spending at US$2.52 trillion in 2026, up 44% year-on-year. IDC expects AI infrastructure spending to reach US$223 billion by 2028, with 82% of that tied to cloud deployments. 

Meanwhile, the International Energy Agency (IEA) estimates that data centres consumed about 415 terawatt-hours of electricity in 2024 and could reach roughly 945 terawatt-hours by 2030. That is why the opportunity set now extends beyond software and semiconductors to networking, power, cooling, industrials, utilities, and beyond. [3]

Growth investing in 2026 is less about buying a label and more about tracing where the next durable earnings stream will actually emerge.

Whilst we all want to find the next 100-bagger, the reality is that growth investors who do it well over sustained periods are looking for quality compounders across multiple sectors, rather than swinging for the fences on a single make-or-break theme or idea. 

It is also in precisely these moments, which lack a clear dominant theme, that the best growth investors typically deliver the bulk of their performance. It's when it's uncomfortable that these investors either avoid being shaken out of themes they know have legs, or are smart enough to pivot to those that do. 

The search starts here

That, ultimately, is what this Growth Series will be about. Not growth at any price. Not buying every business with “AI” in the pitch deck, and not assuming the winners of the last cycle will automatically own the next one.

It is about identifying the companies and opportunities with real runway, genuine reinvestment capacity, pricing power and exposure to structural change that can survive a higher-cost-of-capital world. Some of those names will be in technology. Some will sit adjacent to it. Some will be purely equity stories, and some will sit in private markets, or property, or infrastructure. Some may not look like growth stocks at all until the numbers force the market to pay attention.

The key thing to remember is that the treasure is still out there, but the search has become more selective and, frankly, more interesting. 

Over the coming weeks, we will speak to the investors doing the hard yards, the ones willing to leave the beaten path, test the prevailing narratives and hunt for the next great growth opportunities before the rest of the market catches up.