As the price of Bitcoin has once again hit a new all-time high, the stock price of MicroStrategy has also soared significantly, rising more than 2,500% since mid-2020, far outpacing Bitcoin's roughly 660% gain over the same period, and even outperforming the AI leader Nvidia.
Last night, MicroStrategy's intraday stock price surged 15%, reaching a high of $498.89, setting a new record, and its market capitalization also exceeded $100 billion for the first time. Currently, MicroStrategy has risen to the top 100 U.S. listed companies by market value, ranking 33rd on Nasdaq, 89th on the S&P 500 index, and 85th overall in the U.S. stock market.
As of now, MicroStrategy and its subsidiaries hold approximately 331,200 BTC, with a total cost of about $16.5 billion and an average purchase price of $49,874. According to data from Bitcoin Treasuries, MicroStrategy is the publicly traded company with the largest BTC holdings, far exceeding crypto mining companies like Marathon and Riot, as well as the leading crypto exchange platform Coinbase, which are more "crypto-native" in their business. Analysts point out that MicroStrategy still has $15.3 billion in funds that can be used to further purchase BTC, and its aggressive accumulation strategy may continue until the end of the year.
In addition, the company's founder and CEO, Michael Saylor, personally holds more than 17,000 BTC and owns 14% of the company's shares. If the BTC price reaches $100,000, Saylor's personal assets will reach $11.1 billion, enough to raise his global billionaire ranking by nearly 200 positions, surpassing Peter Thiel.
This year, the 60-year-old Michael Saylor, in his zodiac year, not only "all in" on the company's massive BTC purchases, but also leveraged, making a bold gamble that has completely changed his and MicroStrategy's destiny.
Michael Saylor began to use BTC as a strategic reserve on behalf of the company in 2020. This company, which was originally focused on business intelligence, data analysis, and cloud computing, has transformed into the publicly traded company with the largest BTC holdings in the world due to its bold BTC investment strategy.
But this crazy "buy, buy, buy" BTC die-hard fan had once said "BTC won't last long, it's just a matter of time, its fate will be the same as online gambling." At the time, he thought that BTC would either be declared illegal and completely banned, or it would be outperformed by other cryptocurrencies and withdraw from the historical stage.
So what happened in these ten years that turned Michael Saylor from a BTC skeptic into today's most steadfast believer and advocate?
Playing Games with God, the Business Genius Michael Saylor's First Half of Life
"My belief is that if you're going to play a game, you might as well go all in, without any exceptions. I don't believe those who hold back can laugh last."
Like other internet company founders, Saylor also has a near-legendary life story. His father was a U.S. Air Force master sergeant, and his mother was the daughter of a country singer.
"My father was the typical, strictly disciplined sergeant," Saylor recalled. "If you decide to do something, you have to do your best, you understand? He was an absolutely upright person. I've never seen him lie, no matter to whom or about what, he would never be evasive. It wasn't until I grew up that I realized how unique this quality is. Many people like to take shortcuts and bargain, but my father never did that, he never took shortcuts."
In a color photo, his mother Phyllis is smiling brightly. "My father taught me what character is, and my mother taught me what charm is."
His father told him that there are some things that must be done; his mother told him that he can do anything he wants to do because he is smart. In seventh grade, he was named the newspaper boy of the year, and his mother once pulled him aside and whispered in his ear: "You will surely make a great contribution to society when you grow up, because you have talent and you are smart - so be sure to make good use of these talents."
Saylor was a thorough good student, learning to fly gliders in high school and graduating at the top of his class. Later, Saylor received a U.S. Army ROTC scholarship and entered the Massachusetts Institute of Technology to study the history of science and aerospace engineering. But due to a heart murmur discovered during a physical exam, Saylor had to give up his dream of becoming a pilot or astronaut.
The Ups and Downs of the Entrepreneurial Journey
After working as a computer simulation planner at DuPont for a while, in 1989, the 24-year-old Saylor co-founded MicroStrategy with his MIT roommate and fraternity brother Sanju Bansal.
At the time, Saylor realized that the Internet had powerful data analysis capabilities that could help companies analyze massive amounts of data about their products and markets. Soon, clients began paying MicroStrategy tens of millions of dollars a year to create intuitive charts that displayed clear consumer trends, such as which consumers liked certain beverages or insurance products.
The turning point of the startup really happened when MicroStrategy signed a $10 million contract with McDonald's, which was used to develop applications to evaluate the effectiveness of promotional measures, playing an important role in MicroStrategy's early development.
By 1998, when Saylor was doing an 11-day roadshow for the IPO, his performance was already outstanding. He even invited a Washington Post reporter to document the entire process. Saylor's sales style relied on passion, stage skills, and grand narratives, rather than numbers, and his dazzling introductions were much more captivating than PowerPoint slides.
Wall Street generally believed that Saylor, though arrogant, was indeed very charismatic. From the news reports at the time, Saylor was extremely passionate about data analysis technology and painted a convincing roadmap for its future, and investors almost all signed on based on their confidence in him.
There was a software investor on Wall Street who loved to disparage the CEOs of software companies as "all garbage" every time they had a meeting, but Saylor managed to get him to sign on with his silver tongue. At Bear Stearns, Saylor got the boss to subscribe to 10% of the shares in just 20 minutes. The world's largest fund company, Fidelity, was known as the toughest nut to crack in the industry, but as Saylor put it, he cracked it "like a dunk."
MicroStrategy was also a pioneer in enterprise data analysis technology, which could use data analysis software to help retail companies, pharmaceutical giants, banks, insurance companies, and government agencies discover important trends from massive amounts of data. With this unique skill, MicroStrategy landed more than 300 long-term clients, including giants like KFC, Pfizer, Disney, Allianz, Dun & Bradstreet, and ABC.
After going public in June 1998, MicroStrategy quickly became the darling of Wall Street. By March 2000, its stock price had reached 16 times its IPO price, with a market value of nearly $18 billion.
However, at this time, MicroStrategy became embroiled in an accounting scandal, and its stock price plummeted 62% in a single day, causing Saylor to lose $6 billion of his personal fortune overnight, and even becoming the answer to a question in the trivia game show "Who Wants to Be a Millionaire?": "Who lost the most money in a single day?"
In March 2000, MicroStrategy's auditor PricewaterhouseCoopers asked it to restate its revenue and profits for the previous two years. After the re-audit, MicroStrategy's performance in 1998 and 1999 changed from a $28 million profit to a $37 million loss. Saylor and another co-founder and the company's chief financial officer chose to pay a $11 million fine to the SEC to settle the related charges, with Saylor himself paying $8.3 million, but Saylor and the others involved in the scandal did not admit any wrongdoing.
By mid-2002, MicroStrategy's market value had plummeted to around $40 million, a 98% drop from its peak.
However, Saylor then had another idea, and it was this idea that led to MicroStrategy's resurgence. He foresaw the explosive growth of mobile devices, and therefore believed that he could develop some programs to help clients analyze the massive data collected from users' iPhones and laptops.
Around 2009, Saylor provided his software for free to Sheryl Sandberg, the new chief operating officer of Facebook, and MicroStrategy's technology was crucial for Facebook, as it allowed salespeople to know how much revenue each product could bring. Facebook eventually became a stable customer of MicroStrategy, bringing it several million dollars in revenue each year, and Saylor also achieved sustained profitability by riding the wave of mobilization.
Becoming an Admired Thought Leader
Although his business is not particularly large, Saylor's personal life is quite luxurious. He has a villa in Miami Beach with 13 bedrooms and 12 bathrooms. He also has a $47 million Bombardier jet and two yachts. One of the yachts is called the "Harle", named after the ship that brought his ancestors from Rotterdam, the Netherlands to Philadelphia in 1736.
Saylor is also a party enthusiast. In 2010, he threw a wildlife-themed party for his birthday at the W Hotel in Washington, even draping a Burmese white python around his neck for photos. Every Thanksgiving, he hosts a rock festival in Manhattan's SoHo, where guests dress up as rock stars.
In an interview with Fortune, Saylor's former colleagues said that in addition to his lavish social life, Saylor also craves widespread influence in the tech industry, and he very much wants to become a renowned thought leader. In the words of a former employee, he wants to "become an admired thought leader".
However, according to former colleagues, Saylor is a mercurial and micromanaging person, and some say he "manages too strictly". Saylor is extremely self-confident, and therefore he feels he can do everything himself, and is unwilling to empower his subordinates too much.
But it turns out that Saylor is very good at observing major trends. In 2012, he published a bestselling book "The Mobile Wave: How Mobile Intelligence Will Change Everything", which foresaw how mobile devices would revolutionize everything from retail to banking.
Saylor has created at least two notable new businesses within MicroStrategy. A former Saylor colleague once said of him, "He has the ability to foresee the future."
In the late 2000s, Saylor developed a monitoring platform that allowed homes and businesses to monitor their security systems through the Alarm.com website. In 2008, he sold this business for $28 million. In the early 2010s, Saylor developed the first cloud-based automated voice response systems for call centers, naming it Angel. In 2013, Genesys acquired Angel for $110 million.
His former colleague said: "Saylor doesn't allow people to do things their own way, but without that freedom, people can't grow. Of course, I think the benefits outweigh the drawbacks. Just think, if you had invested with him every step of the way, first in the internet, then in mobile technology and cloud computing!"
However, Saylor's emotional and volatile style has also put a lot of pressure on the management team and to some extent hindered the company's development. Since 2018, he has already changed 3 marketing directors, and a chief financial officer left after just a year. Saylor is unable to retain top talent, which also explains why he did not grow and strengthen businesses like Angel and Alarm.com, but instead sold them to other companies.
Michael Saylor's favorite game is Dungeons & Dragons, and he has always insisted on becoming the dungeon master, because he "likes to create and control the situation", just as his business decisions have been repeatedly proven correct, all of which are inseparable from Saylor's judgment of the situation.
The entrepreneurial experience of his earlier life has already given Saylor enough adventure experience. Saylor is a Christian and has been baptized, but in his view, real-world life is like playing a game with God. "Look at my ring - there's a big dam, and a beaver. That beaver is playing a game with God in the waves. Edison was playing a game with God. Rockefeller, Carnegie... these people are all like me, just playing a game in this life."
Michael Saylor's game in the second half of his life has begun.
Calling Musk to Join the Ride, Why Does Saylor Want to Buy Bitcoin?
In 2015, MicroStrategy's revenue was $134 million, but the company's operating revenue has been declining year after year since then. By 2018, revenue had plummeted to $3.98 million, and in 2019 it lost $1 million, and in the first three quarters of 2020, MicroStrategy lost about $14.02 million.
At that time, the world was in the midst of the COVID-19 black swan event, and Saylor had an epiphany. MicroStrategy had a large amount of cash on hand, and Saylor was concerned that the Federal Reserve's loose monetary policy would exacerbate inflation and severely devalue the cash he held.
At the quarterly meeting in July 2020, Saylor announced that MicroStrategy plans to purchase Bitcoin, gold and other assets to replace the cash still held on its balance sheet.
A month later, MicroStrategy used $250 million in cash on hand to purchase 21,454 Bitcoin. In September and December 2020, MicroStrategy invested another $175 million and $50 million respectively to purchase Bitcoin.
In December 2020, to further expand its Bitcoin holdings, MicroStrategy issued $650 million in convertible bonds, most of which mature between 2027-2028, and some are even zero-coupon bonds. This allows the company to maintain a lower financing cost over the next few years, and after obtaining the bond financing, quickly use it to purchase Bitcoin and add it directly to the company's balance sheet.
By continuously financing through debt to increase its Bitcoin holdings, MSTR has not only increased the amount of Bitcoin on its balance sheet, but also clearly boosted the market price of Bitcoin. As the proportion of Bitcoin in MSTR's asset portfolio has continued to increase, the correlation between the company's stock market value and the price of Bitcoin has further strengthened. According to MSTR Tracker, the correlation coefficient between MSTR's stock price and Bitcoin price has recently surged to 0.55, reaching a new high.
Since the mid-to-late last year, MicroStrategy has adopted a new way of buying coins, which is to purchase more Bit by issuing and selling its own MSTR shares. This "sell shares to buy Bit" strategy may seem very foolish at first, as it could not only hurt the stock price, but also threaten MSTR's market positioning as a "leveraged Bit" company. However, after carefully analyzing the logic chain, it will be found that the issuance will not only not have a negative impact on the MSTR price, but will actually make MSTR more valuable.
Related reading: "Issuing debt to buy Bit" strategy hasn't changed, why did MSTR's premium suddenly soar?
When MicroStrategy issues shares to purchase Bit, the newly issued shares are usually traded at a price higher than their net asset value. Leveraging this premium, MicroStrategy will be able to buy more Bit than the Bit actually represented by each MSTR share when it sells MSTR.
For example, based on the correlation coefficient between MSTR and Bit, 36% of the value of each MSTR share represents the Bit backed by the company. Without a premium, when MicroStrategy sells MSTR, it can only exchange for 36% of the Bit from the market. However, currently, the premium of MSTR over Bit is around 2.74, which means that every time MicroStrategy sells one MSTR share, it will be able to exchange for about 98% of the Bit.
This means that the company can use funds higher than the net asset value of Bit to increase its Bit holdings, thereby expanding the Bit holdings on its balance sheet. The core of this strategy is that MSTR raises funds at a high premium, thereby increasing the speed and scale of its Bit holdings, which is far faster than the previous "issuing debt to buy Bit" strategy.
According to the latest 8-K filing, MicroStrategy achieved a 41.8% return on its Bit holdings in 2024, which is equivalent to a net gain of 79,130 Bit for shareholders, averaging about 246 Bit per day - and all this without having to bear the high costs associated with mining. If all the world's miners were to achieve the same result, it would take about 176 days.
Thus, Saylor has created two firsts: one is to make MicroStrategy the first publicly traded company in history to purchase Bit and incorporate it into its capital allocation strategy, and the other is to be the first company to dare to buy Bit with other people's money.
"Repairing the Balance Sheets of the World"
Not only does he buy himself, Saylor also advises his business tycoon friends to buy as well.
Now a close friend of Trump, "Comrade Ma Baoguo" Musk had not yet delved so deeply into cryptocurrencies four years ago. In December 2020, Musk posted a slightly mocking picture of a monk with his hands clasped and his gaze devoutly upward, unable to resist the temptation of Bit. Saylor replied to Musk suggesting that he do a "trillion-dollar deal" for Tesla shareholders by converting Tesla's balance sheet from dollars to Bit.
Musk asked, "Can such a big deal be realized?" Saylor replied, "Of course, I have purchased over $1.3 billion in BTC in the past few months and would be happy to share my operating strategy with you privately."
In February 2021, Tesla disclosed that it had used cash from its balance sheet to purchase $1.5 billion in Bit, and announced that it would begin accepting Bit as a payment method for its products.
In October this year, Saylor again called out to Microsoft CEO Satya Nadella, saying "If you want to make another trillion dollars for Microsoft shareholders, please contact me." According to an SEC filing, Microsoft is preparing to discuss potential Bit investments at its December shareholder meeting.
TIME magazine interviewed Saylor, and the reporter asked him right off the bat if Bit is an irrational boom, "even if they don't believe something has value, people will blindly join the gamble out of envy for others' success."
Facing this sharp question, Saylor answered with great certainty, "No, on the contrary, Bit is a textbook case of a rational response to inflation. So-called 'rational behavior' is to find a means of value preservation and appreciation. Speculation, on the other hand, is to suppress opponents through short-selling and other means, and that's speculation. Investing in Bit is not speculation at all! Bit is a completely new technology, comparable to Facebook and Google in the financial world, with huge potential for appreciation in the future."
The reporter then posed an even more challenging question: "If that's the case, why does Bit have such a bad reputation?"
"A new paradigm means a complete change in the way we view the world, and vested interests are often unwilling to accept such new things. Our only hope lies in the next generation. Because unless there is a war or a very serious event, these vested interests will not change their minds, but the young are different."
The reporter asked, "Do you have any ambitions then?"
Saylor simply said, "I want to repair the balance sheets of the world."
Michael Saylor's passion for Bit is not just a business adventure, but a belief. From a data analysis pioneer to a staunch proponent of Bit, he has driven MicroStrategy's transformation with his strong personal will and business insight, while also demonstrating to the market how to reshape a company through extreme risk-taking.
However, this high-stakes strategy has also raised doubts in the market. Some analysts are concerned that MicroStrategy's high leverage exposure to Bit may amplify the impact of market volatility on the company, especially in the face of violent Bit price fluctuations. Furthermore, although Saylor claims to want to repair the balance sheets of the world, it remains to be seen whether this vision can withstand the test of time.
Saylor once said, "Life is a game," and this game about Bit is clearly one he has no intention of stopping.
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