Importance of 129,699 Bitcoins

Michael, great to have you with us.

So talk to us about what drove this decision to move on from that CEO's spot.

Is it the end of the Bitcoin era for micro strategy?

No, no, it's the beginning of the Bitcoin era.

We got into Bitcoin about two years ago, and it's been a story of great success.

The stock is up 123%.

We outperformed Bitcoin.

We did three X as well as any other enterprise software company,

about three X as well as any other big tech company.

So the shareholder returns have been better than any competitive stock or any competitive asset class.

And most importantly, our balance sheet as well.

We've increased our enterprise value by more than 730%.

In essence, from 600 million to five and a half billion dollars over that 24 month timeframe.

So now we've got to the to the next point in our development where we've decided we wanted to have a full time world class CFO.

And we also wanted to bring one more person to management team.

So Andrew Kang joined us in May as CFO,

fondly had been the president and CFO of the company.

And when Andrew joined, that opened up the door for us to make Fong, the president and CEO,

and for me to move to the role of executive chairman of the company.

Now, some people have written in the news that somehow this is related to our quarterly result or this large impairment charge we're talking in Q2.

It's totally unrelated.

The fact is I've been working with Fong on CEO succession for about four years now.

And it's always been part of the plan.

We finally got to the point where we had Andrew, our new CFO on board.

And we could actually make the change in Fong to be CEO.

So I think that the market's responding to the fact that now instead of two executives,

sailor and Fong Lee, we have three executives.

And it allows me to do what I like to do, which is Bitcoin advocacy,

Bitcoin acquisition.

I'll continue to provide oversight for Bitcoin acquisition as the chair of the investments committee of the board.

I'll stay as the chair of the board.

And I mean, Fong, who has been the president and the chief operating executive,

he'll just be running the day-to-day business.

And Andrew, whose war class CFO will be here to help us pursue all of our financial strategies.

Okay.

So just for the record then, to those who are speculating that you were pushed out of this role, is there any truth to that?

No.

I'm, first of all, it's my idea, Emily.

And second of all, yeah, some people said they're idea.

I'm the controlling shareholder of the company.

I have the majority of the voting stock.

And so I've been planning to place Fong as the CEO since we've made him chief operating officer.

That was like 2018.

And we made him president in 2020.

And at that point, he was running sales marketing technology services pretty much everything.

And he was the CFO.

And so that was his two years to get comfortable in that role.

And we couldn't elevate him to CEO until we had another CFO.

It's totally inappropriate to have a CEO and CFO as one person in a publicly traded company.

So the catalyst for this is when could I find a CFO and when would it,

when would Fong have had the time to season in the role?

And both of those things,

they, the plan predates my infatuation with Bitcoin.

Emily, it goes back that far many years.

All right.

Still, micro strategy lost a billion dollars due to your Bitcoin holdings.

It's underperforming, you know, the biggest tech companies that are also underperforming.

How do you square that?

You know, how much is too much for you?

Or when will it ever be too much?

OK, well, first of all, it's a non-clash and definite intangible loss.

The number that matters to our shareholders is 129,699.

That's the number of Bitcoin we hold on our balance sheet.

And as I've just laid out, over a two-year period,

our strategy outperforming the NASDAQ by a factor of 10.

So we are volatile in the near term, more volatile than a lot of things,

but volatility is the price you pay for performance.

We could have chosen a more conventional path in August of 2020.

And just given $500 million back to the shareholders and operated an enterprise software company

that would have been worth about $60 a share.

But there's no way we could have achieved superior shareholder returns

if we weren't willing to take a risk and embrace that volatility.

So the result, as you can see it, is the stock is above $300 a share.

It gyrates.

We have more volatility in one hour, Emily, than we had in 12 weeks before.

But I embrace the volatility because the alternative would be we're dead money

and no one cares about us.

Now, even Tesla sold 75% of its crypto holdings.

And on that day, that Tesla announced it, you tweeted,

if you sell 75% of your Bitcoin, you only have 25% of your Bitcoin left.

Is Elon Musk wrong?

Such a sad day for Tesla.

It's, you know, we all regret having chosen great assets.

All of my investment mistakes in my entire career,

where I bought a good thing and then I sold it too soon.

And there's never going to be more than 21 million Bitcoin.

And 100 years from now, there'll be no more than 21 million Bitcoin.

So I think that it's a buy and hold strategy.

I think that, you know, Tesla has as many other issues that I am not privy to.

So it's not my place to criticize them.

But I do think that acquiring and holding high quality property forever

is a good investment strategy.

And Bitcoin, in my opinion, is the highest quality property in the world.

Now, a housekeeping question.

You filed with the SEC to issue 450,000 shares as part of an employee benefit plan.

Is that going to the new CEO to you to other employees?

No, there will be a stock option grant to the new CEO.

It's 60,000 shares.

But the rest goes to the employees, not to me.

I haven't had any stock option grant since 2013.

And I work for a dollar a year.

So we have made a concerted effort to make sure that nearly all of our employees

have either stock options or restricted stock units.

And that way they share in our Bitcoin strategy success

as well as our enterprise business intelligence strategy success.

And that's been a highly successful motivational program.

It's cut our attrition in half and been great from around.

So look, I know Bitcoin supporters have been arguing for a decade that, you know,

decentralized cryptocurrency would dethrone the US dollar.

It hasn't happened yet.

Will that happen?

No, I don't think it'll happen.

But what I do think is there's incredible consensus

that the entire world wants a digital dollar, like a stable coin, like circle or a tether.

And they want it because their currencies are collapsing.

And 8 billion people would like to have dollars on their Android phone.

And I also think there's a consensus that a digital commodity like Bitcoin

is a really important asset to stand alongside things like gold or oil or land.

And there's incredible demand for that sort of digital property in the world.

And so I think Bitcoin will, Bitcoin is going to grow as an asset class

as it's legitimized and embraced as an asset class.

I think it'll coexist alongside other assets.

And I think that there will always be fiat currencies from strong, well-run nation states.

But Emily, it is true that in places like Sri Lanka and Venezuela and Nigeria,

their currencies are collapsing.

And those citizens are going to use the dollars of medium of exchange for the near term.

And if you want a long term store of value, and I'm saying looking out four years or longer,

you want property and Bitcoin is of course that long term digital property you want to hold

as a store of value.

All right, Michael Saylor.

Always good to have you, Michael.

Thank you for stopping me.

Thanks.