While Global Positioning System, or GPS, has been around since the mid-1970s, the technology was held for private use by the government. However, in 1989, President Reagan issued a directive that with the launch of the first modern satellite, GPS would be made free and available to the public. This was all the opportunity engineers Min Kao and Gary Burrell needed to form their company, Garmin

Flash-forward to today, and Garmin has become a global leader in creating high-quality GPS for automotive, aviation, marine, outdoor, and sports. The company's founders, Kao and Burrell, are reportedly worth $2.8 billion and $1.8 billion, respectively. 

Making Garmin's success all the more incredible, a study conducted by Shikhar Ghosh, a senior lecturer at Harvard Business School, found that 75% of start-ups fail. To address this issue, Min Kao accepted an interview in 2012 and discussed three essential ingredients to launch a successful start-up. It's a recipe not only beneficial for budding businesses, but also a simple road map for locating quality investments. 

1. "You definitely need a vision."
In Garmin's 2001 letter to shareholders, just a year after going public, their vision was clear: "Garmin is committed to developing innovative products that help people navigate and communicate anywhere in the world." 

This statement tells you everything you need to know about the company. Garmin believes in innovation, it's unique because of the products they develop, and they make products for people all over the world who want to be on the cutting edge of navigation and communication. 

As an investor, this should be where your journey begins. Earnings and investing metrics have their place, but nothing is more important than understanding who a company is, what they're trying to accomplish, and why anyone should care.

2. "You need a team, partners who are able to translate the ideals into tangible products."
You understand what the company does, and you've bought into to what they're trying to accomplish. The next question is: Are they following through on that vision?

While Garmin's vision has grown and expanded into new markets, the company's core mission of innovating superior products is still intact.

Over the last year and a half, Garmin developed the VIRB (TM) and VIRB Elite -- a series of high-resolution cameras made to withstand the most extreme of conditions. Also new at the company are Vivosmart, a wrist band that tracks your activity levels, two new GPS tracking dog collars, and myriad other improvements to existing products -- all of which are rated extremely well based on customer reviews. 

3. "We're in it for a long time, not to get rich off an idea."
Finding companies that focus on long-term success rather than short-term profits is much easier said than done, but here are a few key questions to start the search:

  1. Does management have skin in the game?
  2. Is the company investing in itself?
  3. Is the company in a market that can last? 

First, as of Garmin's most recent DEF-14A -- a company filing that discusses executive compensation -- Min Kao owns roughly 34 million Garmin shares. This means roughly 60% of Kao's net worth is tied up in Garmin stock. Therefore, Kao has every incentive to improve shareholder value over the long term. 

Second, a company focused on the long term will, as Kao noted, "Make a commitment to invest and reinvest for the future." In other words, it will make a large financial commitment to research and development. Garmin has increased R&D spending every year for the last five, with spending up more than 50% from 2009 to 2013. 

Lastly, not every business or product can stand the test of time. While Garmin focuses on a customer base that demands more robust solutions, automotive GPS is still Garmin's largest business segment, and it's possible -- like maps were replaced by GPS -- dashboard GPS will be replaced by smartphones. Whether or not this comes to fruition, investors should consider the longevity of a company's bread and butter product. 

Bonus: the fourth key to success 
Before building Garmin, Min Kao was an engineer working on algorithms for GPS equipment, and Gary Burrell was "vice president of engineering at marine and aviation electronics companies." It was Kao and Burrell's industry expertise combined that clued them into the incredible opportunity available in navigation technology, and allowed them to be successful. 

Ultimately, Kao and Burrell focused on an industry they understood, committed to a vision they believed in, and they invested for the long term, and it's proven to be a simple but effective approach for the Garmin billionaires.

Dave Koppenheffer has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.