What can making highway toll payments teach us about technology investing? Dave Meier offers an answer in the latest edition of "Wandering Fools."

My daughter plays soccer for Swarthmore College, located about 30 minutes west of Philadelphia. We traveled up and down I-95 from northern Virginia this autumn to watch her and the team play. The team had a memorable season, winning the regular-season conference title and making it to the Elite 8 of the NCAA tournament. That’s nice, but it’s what I learned on those trips to the games that are the focus of this month’s Wandering Fools column.

At Fool Funds, I focus on technology and consumer stocks. I am an engineer by trade, having made the switch to investing just over 10 years ago. And I am a late adopter of various products (in addition to a soccer nut through and through). Along I-95, as well as many freeways across the country, riders have to pay tolls. From my house in Ashburn, Va., to Swarthmore, Pa., I can pay almost $30 in tolls (round trip) and drive to the college in two hours and 15 minutes. But the only way that works is if I use E-ZPass. As a trade-off, I take a different route, cut my tolls to $12, and arrive at the game in about three hours. If I don’t want to pay any tolls, the trip would take about three hours and 45 minutes.

E-ZPass is technology that allows drivers to pay tolls without stopping. It removing the friction associated with waiting in lines to throw money into bins or pay an attendant directly. Given the usefulness of the technology, drivers continue to flock to E-ZPass. According to its data (http://www.e-zpassiag.com/about-us/statistics), more people have been opening accounts with their credit cards, putting transponders on their cars (we have three in our family), and using passes to breeze through tollbooths.

As long-term investors, we’re looking for companies that use technology to remove barriers and make something easier. It helps if there's a big market opportunity, not unlike traffic on highways. And it’s important for the company to create value from its technology and find a way to capture some of that value over time.

A perfect example is TripAdvisor (Nasdaq: TRIP), an investment in both the Independence Fund and the Great America Fund. TripAdvisor is the largest travel research site in the world, with more than 350 million monthly unique visitors and 290 million reviews of about 5.3 million businesses globally. With numbers like those, TripAdvisor has become the de facto standard for travel research, having made the process of planning that perfect trip substantially easier.

For many years, TripAdvisor generated revenue by selling advertising space to online travel agents looking to get in front of all those would-be travelers who were migrating to TripAdvisor’s platform. Management has done an incredible job of growing revenue along the way and helping travel agents generate sales. Never one to rest on its successes, TripAdvisor has been innovating to make the advertising process even easier, introducing its Metasearch product a few years ago and its Instant Booking product most recently. In addition, TripAdvisor has brought its capabilities to mobile devices, giving users another channel to book a hotel room, make a restaurant reservation, or schedule a visit to a nearby attraction.

Instant Booking is the company’s latest example of removing friction to make the process of booking a hotel room even simpler. TripAdvisor has partnered with seven of the 10 largest hotel companies in the world, as well as Booking.com from Priceline, to enable TripAdvisor users to reserve hotel rooms directly without leaving the TripAdvisor website. That’s good for everyone, as it reduces the number of steps it takes for the customer to book the room and should lead to higher conversion rates going forward. And TripAdvisor will capture a portion of the value it creates by charging a commission for each hotel reservation made through Instant Booking. The increased revenue and cash flow can then be reinvested in the business to find a new way to make the TripAdvisor experience faster and easier for both users and customers.

You see how that works? Each time TripAdvisor makes an upgrade to its platform, it generates revenue and cash-flow growth, which it uses to fund the next upgrade. It’s a wonderful business model and one that’s very difficult to replicate, making it an attractive long-term investment.

My daughter’s soccer season is over, but investing research never takes a break. So I’ll keep a look out for more investing lessons and stock ideas while I’m on the road.

Until next time … Fool on! 

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