Hundreds of billions of dollars in 17 years to get here. And what we know is Bitcoin is the dominant global digital capital network. So what is that worth? Even if only 10% of the capital wants to be digital, then that's a hundred trillion. By the way, how much Bitcoin has BlackRock sold in the past 3 months? Do you know for every Bitcoin we sold, other actors in the market have sold a thousand times, actually 2,000 times. So in the middle of a bear market, Bitcoin crashed from 120,000 to 60,000 and we sold 32 Bitcoin. We have bought net 250,000 Bitcoin or something. In what way are we at systemic risk? So Bitcoin was 120,000 8 months ago. It's 60,000 now. It's sitting around the 200-week moving average now. So there's a massive base of support which means that by the way, you know who was buying the ETFs? A lot of them were the hedge funds shorting our stock. So there were people shorting 25 billion of MSTR and buying 25 billion of IBIT as the pair trade. What do you think would happen if we basically sold 250,000 Bitcoin right now?
What happens if Bitcoin from here where it already lost 50%, goes down another 50% from 60K to 30K? But on the other hand as well, what if Bitcoin doubles again and goes from 60K back to 120K? These two scenarios, what happens to MicroStrategy, the stock MSTR, and what happens to Strive?
Yeah. Before I answer that, I'll just say one funny thing, which is in six years, our company went from an enterprise value of 600 million to an enterprise value of, you know, up to 120 billion and now it's like 80 billion or something. Not a single positive story in any mainstream media in the entire six years. Not one. And then when I became chairman and Phong was CEO, they're like, 'Saylor got fired.' And then they ran a bunch of negative stories. Saylor got pushed out of the company, fired because the Bitcoin thing failed. And that was like when we had two billion of Bitcoin. And then when we got to the point where we had 50 billion of Bitcoin, you know, I guess two weeks, three weeks ago, right, Bitcoin traded from 82,000 to 62,000. So we have a $16 billion mark-to-market loss. And so the story is, you know, Saylor's company lost $16 billion. They basically revived me, put me back in charge of the company, and then made me responsible for the failed strategy, which I thought was amusing. But nobody... And so, yeah. So if you have 800,000 Bitcoin and it trades down 20,000, you'll have a $16 billion mark-to-market loss. But nobody ever once asked the question, where'd they get the $16 billion to lose? Because we started the journey with $250 million of cash. And of course, the story is a company with $250 million managed to find a way to actually get the $80 billion to lose the $16 billion. But they will never write that story. And the only moral or lesson of that is no one is ever going to write the story of your success. You shouldn't expect it until it becomes conventional wisdom. They will write the negative story, the cynical story. There's like endless negative stories forever. For whatever reason, our Bitcoin strategy failed when we were two billion, when we were five billion, when we were 15 billion, when we were 30 billion, when we were 60 billion, it keeps failing. There's never been a positive story ever. It will always be negative. And so you kind of have to craft your own narrative and you have to have your own distribution channel for messages because otherwise, you know, the Peter Schiffs of the world that will tell you Bitcoin is a failure at a dollar will basically have it fail at a dollar, $10, $100, $1,000, $10,000, $100,000. It's like if after you got 300 times or a thousand times as big, you're still failing, you know, you'll never succeed, right? And I really think I attribute that to the fact that conventional wisdom is everybody will determine that they will declare you a success without thinking about it when it's conventional and they will declare you a failure without considering it when it's unconventional. And the conventional wisdom that works against you on the way up will then work to support you once you push through that barrier. And probably the danger is believing any conventional wisdom because it probably is what causes you to become corrupted in time. But back to your other issue. So Bitcoin was 120,000 eight months ago. It's 60,000 now. It's more compelling now. It's sitting around the 200-week moving average now. So there's a massive base of support right now, which means that it makes a lot more sense for a risk-averse investor or any kind of diversified investor that has a portion of their portfolio in gold, equity, real estate, credit, and Bitcoin. It makes more sense for them to be moving their allocation back into Bitcoin now. And so you'll see a reversal in the market. If it were to fall to 30,000, Bitcoin, the digital capital would be trading at a discount to its book value, to its 200-week moving average. That would mean that it would be oversold. You would definitely want to buy it then. It's even more compelling. The equities that are levered on it like the Bitcoin equities, the strategy, the strives are even more compelling, and the credit instruments would be more compelling. And if you look at Austrian economics and you consider it's like the free market is always going to adjust supply and demand. So when the things are underpriced, you're going to see a flow of capital into them. When they get overpriced, you see a flow of capital out of them. I don't endorse trading strategies just because I think you can get burned by them. But you know, there are a lot of people that don't agree with me in the market. You might be shocked. There are a number of people that won't agree with me in the market. And so there are a lot of derivative traders, you know, people that will trade Bitcoin and they would trade it when it's 2x the 200-week moving average and they would buy it when it's at the moving average or below the moving average. And so you'll see a lot of capital will flow into it. It's going to be self-stabilizing at the end of the day. The thing to keep your focus... I don't worry too much. I generally think if you look at the history of Bitcoin, it tends to trade to a premium, a big premium to the 200-week moving average during periods of leverage and then it trades back toward the 200-week moving average, you know. And so if you're a four-year investor, look at the four years, plot that, look at the current spot price, and you can see where it is. And I tend to look at the 200-week moving average as like the book value of the network. It's the book value of Bitcoin. It's the amount of capital that's been invested on a basis in the asset. So it serves as a pretty good floor. I think that's important. And then, you know, otherwise, if you look back to 2022, you know, after the FTX crash and the crypto crash, there was a point when our stock, I guess it fell, it went from $120 up to $1,200. It went up by a factor of 10 and then in a crash it fell all the way back to like $120 or $130. So we had a 90% drawdown. We had a massive amount of debt and we had a lot of Bitcoin. And so at that point, we were like, you know, right now we had net leverage of 10%, then we had net leverage of like 200% or something, a very large leverage number. Yeah, is that maybe... I don't know if the number is 200%, but it was much higher than it is right now. We had like $2 billion of debt and $2 billion of Bitcoin, you know, something like that. So it was very heavily leveraged, and that was the best time to buy the stock. People that bought that stock, the stock rallied 800% in the next cycle. So I think that, you know, like it or not, for better or for worse, 99.9% of the capital in the world is not invested in Bitcoin and is not invested in the Bitcoin derivatives, the equity and the credit. So if Bitcoin trades down, it just makes the equity, the credit, and the commodity that much more compelling. You'll have capital drawn in that will support it back up. And then, you know, you'll have an extraordinary amount of wealth created in the next bull run. The last point I'll make is it's very important to stay focused on the fundamentals, and the fundamentalists have this right. You know, Bitcoin is economic empowerment and it is sovereign property rights for the world and it is the dominant digital monetary network. Right? This is a maximalist idea. It's a fundamentalist idea. And if you look at Bitcoin dominance or crypto dominance over the past five years, Bitcoin was, you know, in the years from like 2015 to 2020, it was like 70% of crypto. And then when you had peak leverage with peak FTX and all the offshore derivatives, it, you know, Ethereum rallied, Solana rallied, FTX rallied. There was Dogecoin rallied. There was Terra Luna and all this crypto stuff. Dominance fell to 40%. It was like 41% of all capital in the crypto capital market on a capital basis, not on a liquidity basis. And if you look at the last five years, if you look at the percentage of Bitcoin versus the other crypto tokens, not including stablecoin, Bitcoin dominance has gone from 40% all the way up to about 68 to 70%. So nature is healing. Bitcoin has emerged as the dominant crypto capital, really the only crypto capital network, the crypto monetary network, right? No one seriously thinks that Ethereum is going to flip. The flipping did not come, right. There is no Ethereum flipping. No one thinks Solana, Ethereum, Sui, BNB, Ripple, any of the other tokens. No one thinks any of them are going to supplant Bitcoin as digital money, as digital capital. And it took us 17 years to get here. You know, our company had to invest $64 billion, right? And the institutional investors invested hundreds of billions, hundreds of billions of dollars in 17 years to get here. And what we know is Bitcoin is the dominant global digital capital network. So what is that worth? It's got to be worth 10% of all the capital in the world. Even if only 10% of the capital wants to be digital, then that's a hundred trillion dollars. And so what does it matter if it trades 30,000 or 60,000 or 90,000? It doesn't matter whether it's currently valued at a trillion or half a trillion or two trillion. The market need is a hundred trillion or more. There is no second best. There's no competitor. You can't create anything. And so it's just like when Google won, they won. When Facebook won, they won. When Apple won, they won. When Coca-Cola won, they won. When you end up with the monopoly in the space, the franchise, you're going to have periods of hysteria, you know, where there's a panic and then during the panic, Coca-Cola stock or Apple stock or Amazon stock or Google stock or New York City real estate will be cheap and then the panic will subside and people are like, what the heck was I thinking? I mean, why didn't I buy that when of course the world's not ending? And if the world doesn't end, then I guess having a monopoly on something is a good idea. And so Bitcoin's got the monopoly on digital money, the world is not ending. And no one's coming up with a better digital money. And we know that. So this is just a trading opportunity. Bitcoin trades down, you should buy it, you know. And by the way, if you have no money, it doesn't matter because other people have more money than you and they like money and they will buy it and it will trade back up again.
It's like Amazon went from a hundred bucks to two bucks at one point, right? And then it became a $2-3 trillion dollar company.
It was clear in 2010 that there was no retailer in the world that could compete with Amazon. Yeah, it was clear. But it was only clear in 2020 that everybody needed Amazon. So a decade before the conventional wisdom or the consensus was the world needs a company like Amazon, it was obvious to an independent thinker.
And the same is true with Bitcoin. It's obvious the world needs digital money and digital capital, you know, and is it 10 years before everybody agrees with you? Likely. But as I say, you don't want people to agree with you. You want them not to agree with you. You just want to be right.
What I really admire about you is what you achieved even before you got to Bitcoin because you're a self-made billionaire and at this point you've built a hundred billion dollar business. I know there are less than 1% of businesses that are valued at more than 10 million and you built a hundred billion dollar business. I'm at a roughly hundred million valuation now. So what would be your advice to a young entrepreneur like me? How did you do this? How did you scale the business to such an amazing size?
So I guess if I look back at my career, the first thing is you want to create a product. The world doesn't want 10,000 pages of a book. It doesn't really want you to talk at it for thousands of hours. It doesn't want to be educated. It just wants the answer. So everybody wants you to solve their problem. It's either give me the pill like this makes me not fat. Give it to me. Right? If it's like Ozempic or something, I want to be rich. I want to be not fat. I want the car to drive itself. If you could give me a teleporter beam, I would take it. You know, give me something that's very easy that I understand. So the best businesses normally are just this really compelling product and service. The second observation I have is everything we ever did, it's always look at the new technology that everyone that came before you didn't have. So if you want to create a business, it's not likely that you will create a business by using technology that's 30 years old or doing any business model or any technique that your parents used to make money is probably off limits to you. So don't copy anything. Let me say it in a snarky way. Don't do anything that was successful for someone older than you. Right? If someone 10 years ahead of you or 20 years ahead of you did it, it probably won't work for you because the market is just so competitive that once an idea clicks, it's like with classic rock and roll, all the really good classic rock and roll came from like 1969 to 197 something. Sorry if you like 80s stuff, but it's like why? Because we had the amplifier and we had the electric guitar and within 10 years of having all the technology, human genius figures out the stuff. So I think that all these good businesses when we were starting, what did I do? I used a Macintosh computer when nobody in business used Macintoshes. So that was like the new thing. Everybody with a suit and more money than me used an IBM computer or a mainframe or a mini computer. So we used the new thing and then we created graphical interface software when everybody in the world used ASCII, no one used GUIs, and that was the new thing. And then we used the internet when nobody used the internet, and then we used mobile phones when nobody used mobile phones. So as long as you're doing something that no one else ever succeeded at before, then maybe you have a chance to succeed. And whenever you're creating a business and you're saying, 'Well, look, 10 years ago or 15 years ago, they did it,' you're probably going to fail. So if I was doing a business right now, I would say, 'Well, what is new now? Digital assets, digital intelligence, digital communication.' Right? Like, who is Mr. Beast? By the way, if you ask someone that's 20 years older than you, who is Mr. Beast, they probably don't know, right? Because Mr. Beast created a new form of content on a new network that was inconceivable 15 years ago. So things that were inconceivable are generally good ideas. What you want is a business idea that's going to go viral, that's so cool that everyone will tell their friends that they want that thing, right? And there's a litany of them, whether it's Skype or WhatsApp or YouTube or the like. And there will always be more. That's my second piece of advice. My third piece of advice is if you come up with a really good idea, laser-like focus on the good idea and then as soon as it's successful, assume that you have to work 10 times harder to keep it successful because this is the curse of the 30-something alpha male. This happens, I don't know how old you are, but...
But here's the life cycle. It's not always this way, but I'm not saying it isn't the curse of the 30-year-old alpha female because it's the curse of the 30-year-old alpha female, too. It's just women are smarter than men most of the time, and so they don't do what I'm about to describe to you. In your 20s, you actually want to start a business or you do something and then it takes a decade of struggle. And then if you're successful, by the way, a lot of people aren't successful, but if you're successful, you get there after about a decade and then you declare victory and you tell yourself you're a genius and you were born to be successful and then you think about what's the next hill to climb and you're like, well, now that I've succeeded at this, I have to go do the next thing. Like now that I've succeeded at this, I have to launch a second. So in my case, I was successful creating a business intelligence software company that was worth a billion dollars by my mid-30s. So then I came up with 10 more business ideas. And then I was like, I'm going to launch strategy.com, alarm.com, angel.com, emma.com, wisdom.com, usher.com, alert... I'm not joking. These are all real businesses. I created like about 10 of them. None of them worked as well as the first one. But it's the mistake you make when you think, well, the business was successful because I'm a genius and I was put on Earth to create these beautiful things and I'm going to create 10 more. And of course, you're going to say, well, Elon did it. Well, you're like, one guy in a hundred years did it and there's four billion other dudes and eight billion people on the planet. So one person out of eight billion people did it. You're not... That's a fooled by randomness issue. You're not supposed to actually divine your wisdom by looking at the exception to the rule. What I have seen more often than not is it's hard to be successful and people aren't successful because they try to do something that's been done before. They don't embrace all of the new technology. If you embrace new technology and you think originally and you come up with something which has never been done and do it in a way that could have never been done, you have a chance. If you focus, then maybe you succeed. After you succeed, nine out of 10 times the person that succeeded tells himself it was all them and they go off to do 10 more things and they utterly fail. And in my case, I went off to do the other 10 things and I lost years when in fact I should have been invested in the core business because at the point that you create the billion-dollar success or the hundred million, $100 million is very successful, a billion is very successful. At the point that you create that success, you're at the most risky point in the business because your maintenance obligation is increasing exponentially. So what I would say is it's like the stoic idea: can you buy the boat? Yes, you can buy the boat. Can you afford to maintain the boat? Most people can't maintain it. And then do you have a lifestyle to enjoy the boat? So 100 people buy the boat, 10 people, you know, 90 people run out of money and they can't maintain it, like give the boat back. And so 10 people can afford to keep the boat and one person actually finds that they actually use the boat. And you go to any marina and there's like 87,000 little boats that are sitting there. The equivalent in business is: can you create or buy the business or start the business? Yeah. Can you actually run the business profitably and maintain it? Much harder. Can you grow the business while maintaining profitability faster than everybody else in the world? If you want to actually succeed, you have to run the business successfully and grow it faster than your competitor because if you cash cow or harvest the business, they will outgrow you and bury you. And so most people think the joy is in the getting. Have you ever heard people say, 'I just like to get these things started and then go to the next thing'? Okay, that's not a good recipe for business success because you have to say, 'I'm going to do this, devote my life to this. I'm going to make it continuously better in every way than anyone else that chooses to compete with me in this niche forever.' And that's another way of saying people underestimate the maintenance obligation. It's 10 times harder to maintain the business than it is to get into it. And it's a hundred times harder to prosper, to enjoy the business while growing it. And people just underinvest in the relationship. And so that's my last piece of advice. Laser focus, commit, marry it, and every iota of your thinking and energy ought to be how do I make this thing better? That would be virtuous. And the scourge of all businesses is dilutive distractions. It's like my joke is I don't regret my bad ideas because no one's stupid enough to focus on commercializing bad ideas. I regret my good ideas because after you've had one success, you have 10 more good ideas. And you have to ask yourself the question: is this dilutive and distracting to my great idea? And I think most of the time in business, if I live to see one, there were 100 companies in the business intelligence space. 99 out of a hundred went out of business or failed or got amalgamated. Every one of them failed because they got distracted and diluted. They did dilutive acquisitions. They strayed. They lost focus, they lost intensity, they didn't have the endurance. And so business oftentimes is just this commitment to endurance. And yeah, you know, like how many people put laser eyes on, right, like five years ago?
I did. A lot of other people did. I think that 95% of them took the laser eyes off.
Like I still have laser eyes. Like I make a joke. I'll make a joke. It's time to put the laser eyes back on. A lot of people don't realize that I never took them off. They're like, 'Oh, you're gonna Saylor put the laser eyes back on.'
No, I mean, the whole point is I said and focused on the same thing every day for the last six years straight.
And people think somehow you got lucky. It's like the irony is everybody that was in this business before me, like everybody that was in the Bitcoin business before me, it's like they never put the laser eyes on. They took the laser eyes off and they got distracted and went off to work on like one of 18 other things. And success in business is not that complicated. It's whoever wants it the most gets up every single day and thinks, morning, noon, and night about how they're going to serve the customer or how they're going to further the business, they're most likely to win. And I'll make one last point, which is okay, there's eight billion people on the planet. That means if you're the smartest person out of a thousand people in your school, right? There's eight million people as smart as you, right? When you divide a thousand into 8 billion, there's 8 million people that are hyper geniuses. If you were one in a thousand, there's 8 million people you're competing against. If you were 1 in 10,000, there's 800,000 people you're competing with. If you were the smartest person in a hundred thousand, there's 80,000 people you're competing with. There's not 80,000 good businesses. So you think you're smart and you work hard. It's not enough because there's someone that's a hyper genius that has nothing that you have that wants it, right? And so if you are lucky enough to be in a business, you just have to say to yourself, there is a person that is the smartest person in their entire city that has nothing, that's younger than me, that's got nothing to lose, that's got everything to gain, that they're going to go 80 hours a week. You know, when I left MIT, I worked 70 hours a week, 50 weeks a year. So 3,500 hours a year for 10 years straight in order to get to the point where the business was successful. And people asked me about this, said that was really easy compared to MIT.
We're lucky.
