The Oracle of Omaha, Warren Buffett, turned an initial bankroll of $10,000 into a multibillion-dollar conglomerate. Shelby Davis began with $50,000, and he amassed a $900 million fortune. These inspiring stories give us all hope that we'll be able to achieve our own financial dreams. But what if you don't have $50,000, or $10,000, or even $5,000 to get started?

Fear not, Fool -- you aren't doomed to penury and misery. You don't need a trust fund as big as Trouble's to start securing your financial future. Just follow these four steps:

  • Start today!
  • Invest regularly. Every month, put away $250, $100, even $50.
  • Look to the stock market for your best hope of realizing your dreams.
  • Seek undervalued small-cap stocks for your greatest returns.

Why small caps?
Small caps offer the greatest potential for market-beating returns. Institutions tend to ignore these tiny stocks, and analysts don't cover them. By the time anyone realizes they're there, they've already grown and appreciated in price. To find these future giants, we'll screen for stocks with:

  • Market values less than $2.5 billion, to qualify as a small cap
  • Share prices above $5, to weed out penny stocks
  • An earnings surprise of 20% or more last quarter
  • The prospect of growing earnings at least 20% annually for the next five years, according to analysts.

We'll filter our findings through the collective investing wisdom of the more than 83,000 professional and novice investors in our Motley Fool CAPS community. If the best and brightest CAPS players think these stocks hold potential, then we ought to take notice, too.

Here are some stocks this simple screen found:

Company

Market Cap

Share Price

Earnings Surprise

5-Year Growth Est.

CAPS Rating
(5 max)

Blue Coat Systems (Nasdaq: BCSI)

$896.6 million

$23.59

25%

26.3%

****

Hoku Scientific (Nasdaq: HOKU)

$157.2 million

$9.31

70%

37.5%

*

JetBlue Airways (Nasdaq: JBLU)

$1.2 billion

$6.57

60%

29.2%

**

ShengdaTech (Nasdaq: SDTH)

$668.1 million

$12.35

27%

32.0%

*****

Sigma Designs (Nasdaq: SIGM)

$1.2 billion

$40.62

44%

23.2%

****

Solarfun (Nasdaq: SOLF)

$882.3 million

$15.69

276%

85.0%

**

US BioEnergy (Nasdaq: USBE)

$575.7 million

$7.23

88%

21.7%

*

Screen results courtesy of MSN MoneyCentral, data courtesy of Yahoo!, CAPS ratings courtesy Motley Fool CAPS.

Of course, this is a starting point for more research. This is not a list of stocks to buy. We need to look more closely at these companies to see if analysts' faith in them is well founded, but we've got the CAPS community helping us here. Starting with their favorites is a good place to begin.

Foolish final thoughts
Academics will tell you that individual investors have little chance of beating the stock market. They say the Warren Buffetts, Shelby Davises, and Peter Lynches are the exceptions to the rule. We at The Motley Fool don't agree. Stock investing is not brain surgery. Finding good, undervalued companies is not as difficult as the professionals want you to think.

It is possible to make a more comfortable retirement for yourself, even if you have little money to start with or are starting late in life. It is possible to turn $100 into $1 million. You just have to commit: Do it now, and do it regularly. No amount is too small. Let's get started. There's no time to lose!

Sigma Designs is a recommendation of Motley Fool Rule Breakers. You can break the rules too by getting 30 days of free stock picks simply by clicking here.

Fool contributor Rich Duprey does not have a financial position in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.