Beginning in 2020, MicroStrategy started exploring alternative assets to cash in response to market turbulence in the pandemic year. The firm used money from its treasury assets to purchase over 21,000 bitcoin, a bold move that was closely watched by industry experts and the media. The firm has systematically made big investments in Bitcoin since, including taking on debt to increase its bitcoin holdings.
Saylor was instrumental in the company’s accumulation of bitcoin and helped pioneer the path for institutional investors in cryptocurrency. Some experts cite corporate investing as a contributing factor to Bitcoin’s bull run of 2020-2021.
Saylor is a fervent and outspoken supporter of the cryptocurrency, tweeting about it prolifically on his account, speaking at conferences, and giving interviews touting Bitcoin.
In 2022, Bitcoin’s market downturn caused MicroStrategy stock to lose about two-thirds of its value. In August of that year, Saylor resigned as CEO but remained as executive chairman. He continues to be a steadfast supporter of the cryptocurrency and has doubled down by buying more bitcoin.
Michael Saylor was born in 1965 in Lincoln, Nebraska. His father was in the military, and he spent his childhood living on various U.S. Airforce bases around the world.
Saylor attended the Massachusetts Institute of Technology (MIT) and received dual degrees in Aerospace Engineering and History of Science. While at MIT, he met Sanju Bansal, the future co-founder of MicroStrategy. After college, he became a consultant to companies such as DuPont, Dow, and Exxon, developing computer simulations to predict changes in key markets.
Saylor and Bansal co-founded MicroStrategy in 1989, developing software for data mining before expanding into business intelligence, mobile software, and cloud-based services. He served as the company’s CEO from 1989 to 2022. MicroStrategy was highly successful in its first decade; Saylor was one of the most well-known tech executives in the 90’s Internet bubble and became a multi-billionaire.
In 2000, the U.S. Securities and Exchange Commission (SEC) charged Saylor and two other MicroStrategy executives for inaccurate financial reporting. The company’s stock fell 62% in one day after the company announced its accounting mistakes and Saylor’s personal net worth fell by $6 billion. He kept a low public profile through the early 2000s, continuing to serve as MicroStrategy’s CEO and help build back the company’s wealth.
Role in the cryptocurrency community
Corporate investing in Bitcoin was once a foreign concept in traditional financial circles due to concerns about volatility. However, due to the economic and political uncertainty of the pandemic year, Saylor turned his focus to Bitcoin in 2020 and became one of the first institutional investors to add cryptocurrency to an established company’s balance sheet.
MicroStrategy’s heavy investment in Bitcoin
In a July 2020 quarterly earnings call, Saylor announced his intention to explore purchasing Bitcoin, gold, and assets other than cash to add to MicroStrategy’s balance sheet. He cited declining returns from cash, a weakening US dollar, and global economic circumstances due to many factors, including the COVID-19 pandemic.
Michael Saylor tweeted: "Bitcoin is a bank in cyberspace, run by incorruptible software, offering a global, affordable, simple, and secure savings account to billions of people that don’t have the option or desire to run their own hedge fund."
That summer, the firm used $250 million from its treasury assets to buy 21,454 bitcoin. The company bought an additional $175 million of bitcoin one month later and another $50 million in early December 2020, swapping cash for bitcoin as its reserve asset.
By December 2020, MicroStrategy's bitcoin ownership was valued at $1 billion. Other companies took note of MicroStrategy’s investment, with Square purchasing $50 million in bitcoin in October 2020 and Tesla acquiring $1.5 billion in bitcoin in February 2021. Other institutions also bought bitcoin at historic levels, and many attributed this as one of the main factors driving the bull run that year.
Concerns over Bitcoin strategy
Observers expressed concern that MicroStrategy was acting as a bitcoin investment firm or an exchange-traded fund (ETF). Saylor, who controlled 70% of MicroStrategy’s shares, dismissed these remarks, tweeting: “Per the SEC, #BTC isn’t a security. Ergo, holding BTC doesn’t cause MicroStrategy to become an IC (investment company).” He became even more vocal about the long-term value of cryptocurrency.
In 2021, Saylor started selling company debts to raise money to buy bitcoin, another controversial move. As of 2022, the company’s stock now moves almost in parallel with bitcoin’s price.
Resignation as CEO
In 2022, Bitcoin entered a bear market and prices crashed due to a variety of factors including inflation, interest rates, and investors reassessing their portfolios. MicroStrategy experienced a $917 million loss in the value of their bitcoin investment, causing Saylor to resign as CEO in August 2022. He remained as executive chairman focusing on bitcoin while president Phong Le became CEO, tasked with growing their enterprise software business.
The company has continued to buy bitcoin, with a purchase of an additional 301 bitcoin in September 2022.
Commitment to Bitcoin
Saylor is unwavering in his commitment to Bitcoin, predicting that bitcoin’s value will overtake gold in 10 years, with a potential market capitalization of $10 trillion. He is a self-proclaimed Bitcoin maximalist.
“Bitcoin is digital energy. With this technology we can deliver any amount of power, at any frequency, anywhere in time and space, with nearly zero friction. It is smarter, faster, and stronger than mechanical energy, chemical energy, or electrical energy. It is the future,” he tweeted.
Saylor is named as an inventor on over 40 patents, mostly focusing on record systems and related information.
In 2008, he developed the Saylor Academy, a provider of free online college-level courses. He continues as sole trustee.
In June 2012, Saylor published a book, “The Mobile Wave: How Mobile Intelligence Will Change Everything.” It discusses trends in mobile technology and its impact in healthcare, education, and developing nations.
Michael Saylor essentials
- Michael Saylor is the executive chairman and a co-founder of MicroStrategy, a data analytics firm and the largest corporate investor in Bitcoin
- Saylor was instrumental in helping MicroStrategy accumulate Bitcoin, eventually replacing cash for bitcoin as its reserve asset
- Saylor helped pioneer the path for institutional investing in Bitcoin, likely contributing to the currency’s bull market in 2020-2021