Celebrating 20 Years of The Motley Fool Online

This was written by brothers and Fool co-founders David and Tom Gardner.

Twenty years ago today, on Aug. 4, 1994, The Motley Fool was born online. We'd started a year before as a print newsletter for friends and family. It was truly motley: lead essays about movies or sports backed up by several pages of stock picks at the end. Over the course of the year leading up to our debut on America Online, we spent increasing amounts of time online, participating in investor discussions on AOL and Prodigy (anyone remember Prodigy?). We found ourselves totally attracted to this new online medium where we could interact much more quickly and intelligently with a growing community of Fools. This growing community prompted the AOL Finance team of Rob Shenk and Katherine Borsecnik to invite us out to lunch, and plans for keyword FOOL were not just made, but in the months following enacted.

And so on Aug. 4, 1994, we opened up on AOL.

That first day, we started the "Fool Portfolio": $50,000 of our own real money to be invested in a totally transparent and educational way. Our aim was to demonstrate that we "mere" individual investors could and would beat the market over time. "You can too!" we said, both on our site and then increasingly through our Simon & Schuster books and the coast-to-coast Motley Fool Radio Show, where some of you first found us. The notion that you could beat the market with confidence was a radical proposal at the time. To many still getting (improper) teaching today, it may still seem radical. But from the earliest days of the portfolio, with stocks we picked based on great ideas and information coming in from a growing network of Fools nationwide, beat the market we did. 

Our first stock picks were AOL and some Dow dividend heavyweights, and from there we went on over the years to buy some great long-term winners like Amazon, Amgen, eBay, and Starbucks, some non-long-term winners like Iomega and Celera (amazing but not sustainable), and some downright bad stocks like Excite@Home and 3Dfx. As the stock market hit crazy highs in early 2000, that $50,000 touched a high of just about $1,000,000 for an overall return of 20 times our money. Then everything started falling.

The market came down, the Internet reversed from growth to decline, and our business model -- free ad-supported market advice -- came down with 'em. With the Nasdaq (and all our stocks, too) more than cut in half, it wasn't exactly an easy move to shift our business in 2002-03 from free to premium advice. But we had to, so we chose to close down our beloved "FoolPort," by then known as the "Rule Breaker Portfolio" (and including a talent-laden team headlined by Jeff Fischer), in order to restart again with the new services for which people would actually pay. (They're the services you know today, starting with Motley Fool Stock Advisor.)

And so that portfolio into which we poured our capital and our blood, sweat, and tears -- which started exactly 20 years ago today and was in a sense the first prominent effort on the Internet to provide accountable, winning stock market advice -- closed, in March 2003. Even though it was down two-thirds from its highs, the annualized return from 1994-2003 was 20.16% vs. 9.07% for the S&P 500 with dividends added.

The FoolPort had some cool innovations. In the most un-Wall-Street-like way, we announced every pick we made ahead of time, allowing our viewers to "front run" us if they wanted to; we didn't buy until at least 24 hours later. We were trying to disrupt the financial world and its tendency to take action first and let the public know later. We're still doing that, with services like Motley Fool One and Supernova always giving members a full day first to pick up any new recommendation we make and will later act on. We also supported every stock with its own discussion board; we know, no big deal today. But back then all kinds of skepticism were   heaped on "chatter" in "chat rooms" in "cyberspace" and The Motley Fool was made to sound like we were stretching the outer limits of the investment galaxy with this bleeding edge commitment to community intelligence.

In celebration of this special day 20 years ago, our investment team (thank you, Yervand Khoranian) went back and took the portfolio as it stood in March 2003 and carried the positions right through forward, to today. The question is: Had you just bought and held that portfolio beyond its close on Fool.com and stayed invested till today, how would you be doing?

The results are below, and speak for themselves to the power of Foolish investing:

*Data from S&P Capital IQ; calculations by Yervand Khoranian. Assumes short positions were closed and proceeds from acquisitions were rolled into S&P 500 Spider Index Fund.

Thank you to all our 1994-2003 early Fools who helped create from the outset the world's greatest investment community. To the next 20 years, Fool on! 

The Gardners

Put on some Pearl Jam and relive the '90s! Here's the Fool Port's past in full Foolish display:


Read/Post Comments (14) | Recommend This Article (111)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On August 04, 2014, at 7:02 PM, mazske wrote:

    Back in the late 90's, I was trying to read all of the personal finance books I could find in my local library. I always remember reading one by Suze Orman and in the back, she listed some links of interest.

    One link stood out to me as it was www.fool.com.

    I checked it out and was hooked from day one. That was in May of 1999.

    Thank you, Motley Fool, for all you have done for me.

    mazske

  • Report this Comment On August 05, 2014, at 3:14 AM, thisfoolinsd wrote:

    Maybe I'm just a little thick in the head, but i find this article difficult to read.

    Daryn

  • Report this Comment On August 05, 2014, at 8:33 AM, katyfcolorado wrote:

    Thanks Motley Fool for all your great advice and encouragement. You have and are leading me on the road to wealth. You are modern Benjamin Franklins (with a modern Poor Richard's Almanac). Fool on!

  • Report this Comment On August 05, 2014, at 9:19 AM, RockyTopBob wrote:

    Quite a change in investing methods from the current advertised long term buy and hold reflected in that transaction history. Shorting stocks for the short term, selling stocks owned less than a year. I guess you learned with the rest of us ;-)

    Regards,

    Bob

  • Report this Comment On August 05, 2014, at 9:40 AM, KBecks wrote:

    I still have some Amgen from 1999. We had Ebay for a long time too.

    My worst mistake was listening to the whiners who were bashing you when you guys went to paid services. I listened to them and did not sign up. I wish I had joined your paid services sooner, but better late than never. I was scared by the tech crash and let things sit a long time, then we had kids and little babies keep you really busy! But now since last summer it's been a great time with Stock Advisor, Rule Breakers, Options and PRO. I loved the Fool Fest videos and I love the podcasts!

    Thanks for getting us hooked on stock investing and we look forward to a great future with the Fool!

  • Report this Comment On August 05, 2014, at 11:04 AM, LibbyLoo0 wrote:

    I started with Fool in the late '90's and have been (or at least tried to be) Foolish ever since. AND, my grandsons (18 and 12) benefit from college funds that have been Foolishly managed, along with the Foolish principals shared along the way. (Go MCD and DIS)! Not to mention the friends who wanted me to share stock tips. I refused to discuss specifics with anyone until they read all 13 of the Fool investing steps. Only two friends passed that test (and my 18 year old grandson has started the steps). And we have fun conversations about investing, industries, global economic issues etc etc; all over good food and wine (no wine for my grandson yet). Thank you for the ongoing journey... LibbyLoo0

  • Report this Comment On August 05, 2014, at 3:13 PM, TMFBoiseKen wrote:

    This is an awesome look into the good old days. Congratulations on growing an amazing company and an even better online community!

  • Report this Comment On August 05, 2014, at 4:38 PM, luciuse wrote:

    The Fool is by far the best investing community I ever saw, and in fact one of the best community sites altogether, so congratulations to this tremendous achievement. If ever a site had credibility, yours does.

    I was a member early on, and alas had to learn a lesson or two when the market tanked, and the air came out of those lofty valuations. I'm trying hard to make sure I won't have to pay for the same lesson twice these days!

    One word of critisism though on the occasion: whilst I realise that the good old days of everything free are over (and maybe it raises the quality of contributions if they come from paying members), I find the fees charged for the various buckets pretty hefty, at least the ones officially quoted.

    Worse though, if I didn't know the Fool already, I would have NEVER chosen to re-join recently and pay for any of the advertised services - simply because of the terrible way they are being advertised.

    Guys, have some faith that quality will speak for itself, and stop selling it like some rip-off scheme! That sort of advertising (the next super super stock that is going to earn you a trillion blablabla) is the opposite of what I would expect from a respectable site. And touting something as normally costing thousands, but you'll get it for hundred if you sign up today - seriously guys, that is exactly the sort of behaviour your average member will [hopefully] not endorse. It smells of a scam and is unworthy of this really great website.

  • Report this Comment On August 06, 2014, at 5:38 AM, wax wrote:

    An outstanding achievement especially with the fickle nature of the investing community as a whole.

    I know I have enjoyed being here for the 18 or so years!!

    Congratulations and may the electron gods grant you 20 more.

    Wax

  • Report this Comment On August 06, 2014, at 10:08 AM, foollerene wrote:

    MF provides an awesome service indeed, but it would be even better if the Scorecard service pages were SSL encrypted. I does not seem like too much to ask in this day and age, especially considering how simple procedure it is.

  • Report this Comment On August 21, 2014, at 12:18 AM, KKoleto wrote:

    Congrats Guys. I do remember your newsletters on Prodigy. I thought they were hilarious and informative. The April Fool feature was always fun. The lemon meringue pie thing was a fave.

    Best wishes for the future.

    Ken, Fool

  • Report this Comment On August 22, 2014, at 10:17 AM, TMFJebbo wrote:

    The Motley Fool was recommended to me by a coworker some time back in the 90's. He words were: "I think these guys are on to something."

    He was so right.

    Thanks guys. Great beginning. Looking forward to the future.

    Jeb

  • Report this Comment On August 22, 2014, at 9:54 PM, colleran wrote:

    If it weren't for the Fool, I would never have started investing. It was the first time I saw someone working for me, not for a brokerage. For me it has been 15 years of education about what makes a good company. Thanks, gentlemen.

  • Report this Comment On September 17, 2014, at 6:06 AM, digitalsean wrote:

    Adding my sentiments also. +15 years of information/education has been very profitable and thought provoking. Here is to the next 20 years. Fool on.

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