When Jim Cramer sees investors only paying attention to the activity of publicly traded companies, he considers that to be just plain clueless.
"If you just look at the companies with stocks that currently trade, you might not see the oncoming train of a private company coming right at you," the "Mad Money" host said.
That is why Cramer always has his radar on looking for privately held companies, to discover their recent innovations and figure out how they could disrupt industries that many think are stable.
After all, you don't want your portfolio to be taken by surprise when someone comes along with a better mousetrap.
"I think it is my job to bring you these ideas before they IPO, like HotelTonight, because if I wait too long and you don't find out about them until they're about to go public, you will end up having to compete against huge funds that have gotten their orders in early so they will get top priority over you," Cramer said.
Cramer also reminded investors that when he highlights a private company, he often lacks the kind of financials he would normally require before it appears on "Mad Money." He is also not sure if or when the company will make itself public. Thus he remains highly skeptical of the huge valuations from many of the companies, or so-called unicorns, given how difficult the public market has become.
Nevertheless, Cramer has seen a dramatic increase in enthusiasm for some of these private companies. His skepticism was sorely tested when he heard about the growth that these companies have and the prospects that await them.