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Forget Bitcoin. I’ve put my money into these high-growth FTSE AIM 100 tech stocks

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Bitcoin has caught the attention of many investors in recent years. It’s not hard to see why. In 2017, the cryptocurrency jumped from under $1,000 to $20,000, making a lot of people wealthy. Looking ahead though, the prospects for Bitcoin look more uncertain. Not only do the chances of Bitcoin being adopted as a proper currency look slim, but regulators are now cracking down on cryptoassets in a big way.

If you’re looking to make money from the financial markets and you’re not afraid to take on some risk, I’d suggest taking a look at small-cap stocks. This area of the stock market can be highly profitable if you pick the right stocks. For example, had you put £2,000 into Boohoo shares five years ago, that money would now be worth over £30,000. With that in mind, here’s a look at two small-cap stocks in the FTSE AIM 100 that I believe have big potential.

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Online shopping boom

DotDigital Group (LSE: DOTD) is a fast-growing technology company that specialises in artificial intelligence-based digital marketing solutions. Its key offering is an advanced digital marketing platform called Engagement Cloud, which helps organisations connect with their customers. This platform is currently used by over 4,000 companies across more than 150 countries, including the likes of British Airways, Barbour, and Tottenham Hotspur.

The reason I’m bullish on this FTSE AIM 100 company is that I expect it to benefit from one of the most powerful trends on the planet today – the growth of online shopping. Increasingly, we’re doing a lot more of our shopping online (particularly in the wake of the coronavirus) and this is a trend that looks set to continue in the years ahead. This means that retailers are going to need to get serious about online marketing. DotDigital, which offers solutions that enable companies to effortlessly produce online marketing campaigns, looks well placed to capitalise on this trend.

Source: dotDigital 

DotDigital shares have been stubbornly stuck around the 100p mark for about two-and-a-half years now. In that time, however, revenue and profits have continued to expand (three-year revenue growth of 58%). I think it’s only a matter of time before the shares move higher. Trading on a forward-looking P/E ratio of about 25, I think the shares look attractive right now.

A FTSE video gaming stock

Another FTSE small-cap stock I like right now is Keywords Studios (LSE: KWS). It provides support services to the global video game industry and works with some of the biggest names in the industry, including Activision Blizzard (Call of Duty) and Epic Games (Fortnite).

The reason I’m bullish on Keywords is that video gaming is absolutely booming right now. In the UK, video gaming now accounts for more than half of the entertainment market. Meanwhile, globally, the video game industry now generates more revenue than the movie and music industries combined.

Looking ahead, the video game industry is only going to get bigger. With games set to advance to the next level thanks to faster internet speeds and emerging technologies such as virtual reality, and e-sports set to continue increasing in popularity, the video game market looks set for powerful growth. Keywords should benefit.

Keywords Studios is relatively expensive. Currently, the forward-looking P/E ratio is about 44 (dropping to 33 using FY21 earnings). This valuation adds some risk. However, I believe the risk/reward proposition here is favourable.

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A Top Share with Enormous Growth Potential

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Not only does this company enjoy a dominant market-leading position…

But its capital-light, highly scalable business model has previously helped it deliver consistently high sales, astounding near-70% margins, and rising shareholder returns … in fact, in 2019 it returned a whopping £150m+ to shareholders in dividends and buybacks!

And here’s the really exciting part…

While COVID-19 may have thrown the company a curveball, management have acted swiftly to ensure this business is as well placed as it can be to ride out the current period of uncertainty… in fact, our analyst believes it should come roaring back to life, just as soon as normal economic activity resumes.

That’s why we think now could be the perfect time for you to start building your own stake in this exceptional business – especially given the shares look to be trading on a fairly undemanding valuation for the year to March 2021.

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Edward Sheldon owns shares in Boohoo, dotDigital Group and Keywords Studios. The Motley Fool UK has recommended boohoo group, dotDigital Group, and Keywords Studios. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.