Michael Saylor: A Bitcoin Investor’s Success Story by Glory Adebajo

This is the story of the first CEO of a publicly traded company to invest a substantial portion—$250 million—of its treasury reserves into Bitcoin. Michael Saylor, the co-founder of MicroStrategy, is that man. 

Saylor’s decision was meant to be a downfall in the lens of most corporate analysts. But it became one of the biggest Bitcoin investment success stories with a remarkable 12-month return of over 400%. In fact, it was named “The Trade of the Century.” Literally, it turned a traditional software company into one of the world’s biggest corporate holders of Bitcoin.

Source: X

Renowned for his contributions to business intelligence software, Saylor made waves when he fearlessly steered his company into the uncharted territory of cryptocurrency investment, a move that would redefine his career and the future of MicroStrategy.

In this article, we narrate the story of how Saylor’s bold Bitcoin investment strategy transformed MicroStrategy and yielded substantial returns.

The Saylor’s Story

Michael J. Saylor is an American entrepreneur and business executive who co-founded MicroStrategy, a company that provides business intelligence, mobile software, and cloud-based services. 

Source: flickr.com

He was born on February 4, 1965, in Lincoln, Nebraska, and spent his early years living on various U.S. Air Force bases worldwide. He later settled in Fairborn, Ohio, near the Wright-Patterson Air Force Base.

Saylor attended the Massachusetts Institute of Technology (MIT) on an Air Force ROTC scholarship and graduated in 1987 with a double major in aeronautics and astronautics and science, technology, and society. 

After a brief stint in consulting, Saylor founded MicroStrategy in 1989 with Sanju Bansal, whom he met at MIT. Initially, the company focused on data mining software and shifted to business intelligence.

As CEO, Saylor led MicroStrategy through its initial public offering in June 1998. However, the company faced significant challenges in the early 2000s. 

In 2000, the U.S. Securities and Exchange Commission (SEC) charged Saylor and other executives with fraudulently reporting MicroStrategy’s financial results for the preceding two years. 

The SEC alleged that the company had materially overstated its revenues and earnings, contrary to Generally Accepted Accounting Principles (GAAP).

Saylor and the other defendants reached a settlement with the SEC without admitting or denying the allegations. They agreed to pay $350,000 in penalties and $8.3 million in personal disgorgement. This settlement was part of a larger $11 million total disgorgement involving the company and its executives.

Despite these challenges, Saylor continued to lead MicroStrategy as CEO until 2022, when he transitioned to the role of Executive Chairman. Under his leadership, the company became a significant player in enterprise analytics and mobility software. 

From Business Intelligence to Bitcoin Believer

Michael Saylor’s friend Eric Weiss, the CEO of Blockchain Investment Group and a Bitcoin advocate, played a key role in influencing Saylor’s belief in Bitcoin.

Source: Linkedln | iConnections

Initially, Saylor was focused on running MicroStrategy and was not interested in Bitcoin. However, during the COVID-19 pandemic, Saylor’s discussions with Weiss at home made him open to the idea of Bitcoin. But then, he wasn’t yet convinced to invest a dime.

The economic climate during the pandemic’s lockdown peak period set the stage for Saylor’s conversion into a Bitcoin believer. At the time, governments worldwide were engaging in quantitative easing measures, and the specter of inflation was looming large. 

As a seasoned businessman, Saylor began to seek alternative investment opportunities that could serve as a hedge against currency debasement. 

During this search, he learned more about Bitcoin’s intricacies, technology, and philosophy. His curiosity quickly turned into an obsession. Saylor’s findings convinced him of Bitcoin’s potential to revolutionize how we perceive and transact with money. 

In his own words, “Bitcoin is a quintessential store of value and the hardest money ever invented.” He called it a “digital version of gold,” i.e., a scarce asset that could serve as a hedge against inflation and currency debasement. 

Additionally, he recognized the potential of Bitcoin’s decentralized nature and its ability to operate outside the confines of traditional financial systems. Apparently, crypto provided a level of freedom and autonomy that appealed to his entrepreneurial spirit.

Not one to shy away from the spotlight, Saylor made a bold return in 2020 during the height of the COVID-19 lockdowns. He announced his plan to buy large amounts of Bitcoin on television, which sent shockwaves through the financial world.

MicroStrategy Goes All In

In August 2020, under Saylor’s leadership, MicroStrategy made a bold and unprecedented move of buying an initial investment of $250 million worth of over 21,000 Bitcoin. 

This initial investment began Saylor’s bold foray into cryptocurrency. Saylor described this move as MicroStrategy’s “treasury reserve asset”.

Source: Wikipedia

The crypto investor doubled down on his conviction just a month later. On September 15, MicroStrategy added another $175 million worth of bitcoins to its balance sheet, bringing the total to 38,250 BTC.  By March 1, 2021, the company had bought approximately $2.2 billion and had 90,859 BTC in total.

As Bitcoin’s price soared, Saylor reiterated his conviction, acquiring more of the digital currency. By the end of 2021, MicroStrategy had amassed $3.5 billion worth of Bitcoin, making it one of the largest corporate holders of cryptocurrency.

Fast-forward to March 2024, when MicroStrategy purchased 12,000 additional bitcoins for $821.7 million. This transaction marked the company’s second-largest purchase since it started purchasing crypto about four years ago. With this fresh acquisition, MicroStrategy’s total Bitcoin holdings are now around 205,000 tokens, valued at over $14 billion.

According to analysts, Saylor adopted a dollar-cost averaging strategy. This approach allowed MicroStrategy to capitalize on price dips and gradually increase its Bitcoin holdings.

However, Saylor’s decision to invest heavily in Bitcoin was met with various reactions. Supporters praised his innovative thinking and willingness to embrace emerging technologies, while critics questioned the risk of investing a significant portion of a company’s assets in a highly volatile asset class.

Furthermore, MicroStrategy’s Bitcoin investment posed accounting challenges, as the company had to grapple with the complexities of holding a digital asset on its balance sheet. Saylor’s team had to navigate uncharted waters to ensure compliance with accounting standards.

The Bitcoin Rollercoaster and Saylor’s Faith 

The Bitcoin market is known for its volatility, with lots of price fluctuations occurring within short periods. Consequently, MicroStrategy’s journey with Bitcoin has been a rollercoaster ride.

When MicroStrategy made its initial $250 million investment in August 2020, the price of Bitcoin hovered around $11,000. Little did they know that within a year, the cryptocurrency would go on a remarkable bull run, reaching a peak of $64,000 in November 2021—a 482% increase from its entry point. As Bitcoin’s price soared, the value of MicroStrategy’s holdings skyrocketed, translating into substantial unrealized gains.

However, the euphoria was short-lived as the market took a sharp downturn. This plunged Bitcoin’s price to as low as $16,000 by the end of 2022—a devastating 75% drop from its peak.

Source: Google.com

Throughout 2023, Bitcoin’s price remained volatile, fluctuating between $16,000 and $25,000, a far cry from its previous heights. MicroStrategy faced substantial unrealized losses on its Bitcoin investments during this prolonged bear market. This tested the company’s resolve and Saylor’s conviction.

However, Saylor was strong in his belief, refusing to capitulate to market pressures or succumbing to fear. He consistently reiterated his long-term vision for Bitcoin. 

Saylor once famously stated, “The magic of Bitcoin isn’t the transfer of money to someone 10,000 miles away—it is the transfer of money to someone 10,000 days away.”

While some critics questioned Saylor’s approach during market downturns, his resolute belief in Bitcoin’s potential as a store of value and a hedge against inflation remained unshaken. He viewed the price dips as opportunities to accumulate more Bitcoin, doubling his investment strategy.

Currently, with Bitcoin trading at around $69,000, MicroStrategy’s Bitcoin holdings have once again experienced a significant increase in value. This represents a remarkable 527% gain from their initial investment price of $11,000 or thereabouts. Perhaps we might conclude that Saylor’s unwavering faith in the face of the Bitcoin dip is a result of his conviction and long-term vision.

The Payoff and the Doubling Down 

Michael Saylor’s bet on Bitcoin paid off handsomely, at least for now. In the past few years, crypto has experienced a remarkable surge in value, reaching new all-time highs and defying skeptics who had written it off as a speculative bubble.

As of April 26, 2024, Microstrategy has 214,400 Bitcoin holdings at a total cost of $7.54 billion, or $35,180 per Bitcoin. With the current price of one Bitcoin above the $65,00 threshold, that’s like double the total investment.

As Bitcoin’s price skyrocketed, MicroStrategy’s substantial holdings increased the company’s bottom line significantly. The once controversial investment decision has now become a major contributor to MicroStrategy’s financial success, vindicating Saylor’s bold vision and faith in cryptocurrency.

The impact of Bitcoin’s price appreciation has also profoundly affected Saylor’s personal wealth. In addition to owning about 17,000 Bitcoin he bought at $9,822 each, his stake in MicroStrategy (about 12%) has skyrocketed in value. This means he has indirectly benefited from the company’s successful Bitcoin strategy.

Source: X

But Saylor hasn’t rested on his laurels. In fact, he has doubled down on MicroStrategy’s Bitcoin accumulation, using the company’s profits to continuously acquire more of the cryptocurrency. 

As of the end of Q1 of this year, the company acquired 25,250 bitcoins more bitcoins for $1.65 billion. This relentless buying has made MicroStrategy’s position as one of the largest corporate holders of Bitcoin. Little wonder he once said, “A designer knows he has achieved perfection when there is nothing left to take away.”

Industry experts have weighed in on Bitcoin’s potential future and its impact on MicroStrategy. Overall, MicroStrategy’s Bitcoin holdings have been a game-changer for the company, and their continued accumulation demonstrates their belief in Bitcoin’s long-term value proposition.

Conclusion

Michael Saylor’s journey with Bitcoin has been nothing short of remarkable, from a traditional businessman to a Bitcoin investor and advocate. Indeed, his bold investment strategy and unwavering belief in cryptocurrency’s potential have yielded substantial rewards for MicroStrategy and its shareholders.

While there are other successful stories of bitcoin investors, you can still join the investment train. 

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