Imagine investing $10,000 in a single stock, and seeing that grow to over $1 million. A return like that would require growth of 1,000% -- not unheard of, but not easy to accomplish either. If you'd put that cash behind Amazon, Priceline, or Tesla over the past decade, you'd be sitting on over a cool million right now.

But cherry picking in hindsight is very different from putting your skin in the game while looking forward. Below, we'll investigate whether Ubiquiti Networks (NASDAQ:UBNT) -- a company that makes wireless networking products with a unique business model -- has what it takes to be a millionaire-making stock.

Cash falling on a smiling man.

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There's a lot going in Ubiquiti's favor

There are three very strong signs that Ubiquiti has what it takes to garner returns of over 1,000% over the coming decade. While these three might seem unimportant or disconnected from one another, I have consistently found that the best stocks share all three qualities on their march to fantastic returns.

The first strength is that management and employees clearly have their own skin in the game. The company is still run by founder Robert Pera, who owned an astounding 72.3% of shares outstanding as of the most recent proxy filing. That slice of the company is worth over $3.5 billion. Additionally, his employees are highly motivated, giving the company 4.2 out of 5 stars, with Pera having an 82% approval rating. By investing in Ubiquiti, you're investing along with the owner-operator and his motivated employees.

The second major factor working in the company's favor is that it has a strong balance sheet. Financial crises -- whether macro or company-specific -- are bound to crop up sooner or later. Having lots of cash on hand -- and a steady cash flow -- helps mitigate any risks associated with such swoons. Ubiquiti has a net cash position of $349 million -- $632 million in cash and $283 million in debt -- and has spit out $167 million in free cash flow over the past twelve months.

And finally, Ubiquiti has taken a unique approach to building out its brand. The company famously spends very little on its sales force -- relying on evangelical users to win over customers and provide some aspects of support -- and relies on highly decentralized R&D teams to develop new technologies.

While such an unusual approach has led some -- like Citron Research -- to publish extremely bearish pieces on the company, it has also given Ubiquiti a pricing edge to win over its niche markets. As venture capitalist Paul Graham of Y Combinator once wrote:

"The only way I can imagine for larger groups to avoid [the bottlenecking of bureaucracy] would be to have no structure: to have each group actually be independent, and to work together the way components of a market economy do."

While it might be an oversimplification, that's what Pera is essentially trying to do with his R&D teams. Whether that remains viable as the company scales to offer ever more enterprise and consumer products is yet to be seen.

But an insidious force is working against the company

And yet, despite all this, there are a few big obstacles that I see getting in the company's way of reaching "millionaire-making" status.

The first and most obvious is that it is difficult to find a moat -- or sustainable competitive advantage -- that can hold the competition at bay. Ubiquiti started out by entering and dominating a niche, providing Internet connectivity to under-served areas both at home and abroad. After that, it moved into enterprise solutions. And while business is currently booming in that area, the sale of hardware like switches, gateways, and access points represents a business that could eventually become commoditized.

As fellow Fool Tim Brugger recently pointed out, the real moat in network connectivity comes from the leverage provided by an Infrastructure-as-a-Service (IaaS) model that some bigger rivals like Cisco (NASDAQ:CSCO) are starting to adopt. Additionally, if the company can't generate growing sales without a more robust sales force, one of the factors helping Ubiquiti keep prices down will evaporate.

Final verdict

In the end, these concerns are enough to keep me from confidently calling Ubiquiti a millionaire-maker. At the same time, I think it could still be a very good investment. Trading at under 30 times trailing free cash flow, today represents a fair entry point.

That being said, it's not enough to convince me to buy the stock or make an outperform CAPS call on my own profile. But there are a million ways to invest and win in the stock market. Mine tends to give the most weight to moats, but yours could be different, and Ubiquiti might be worth further exploration if you believe the company can continue to win over enterprise customers without sacrificing its lean operating model.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Brian Stoffel owns shares of Amazon, Priceline Group, and Tesla. The Motley Fool owns shares of and recommends Amazon, Priceline Group, Tesla, and Ubiquiti Networks. The Motley Fool recommends Cisco Systems. The Motley Fool has a disclosure policy.