more and more Bitcoin, less and less BI?

The founder of MicroStrategy, a specialist in Business Intelligence (BI), has decided to leave his position as Chairman and Chief Executive Officer (CEO), which he has held since the company was founded in 1989, to focus on the role of “Executive Chairman”, within the Board of Directors. Michael Saylor will now devote all of his time to MicroStrategy’s new investment strategy.

Under the impetus of Michael Saylor, MicroStrategy has indeed “pivoted” BI towards a second activity: cryptocurrencies. The publisher has placed almost all of its cash in bitcoins and has even taken out loans to acquire them. In its 2022 results, MicroStrategy said it owned 129,218 bitcoins, and spent $3.97 billion on this digital asset.

At the same time, its results in BI – its historical core business – rebounded in 2021, but after several disappointing years which saw its revenues erode, despite an ambitious recovery plan in 2016.

MicroStrategy generated 510 million in revenue in 2021, for an operating income of 46 million – which is down from the previous year (57 million in 2020). On the positive side, the publisher is increasing its R&D efforts (which rose from $100 million to $120 million). On the negative side, these results do not alone fuel the amount of the company’s massive purchases of bitcoins.

MicroStrategy, an “official tracker”

By separating the positions of Executive Chairman and CEO, Michael Saylor formalizes in any case a little more the dual activity of his company, even the preponderance of its financial activity over that of an analytics editor.

Sign of this “pivot”, the stock price of MicroStrategy oscillates according to the evolutions of the bitcoin. Logical if we listen to Michael Saylor who declared to the American economic media CNBC, in April, that he now saw his company (whose “M” and “S” in the name take up his own initials) as a ” unofficial ETF”.

Michel Saylor, founder

and former CEO

by MicroStrategy

As a reminder, an ETF – or a tracker – is a financial tool that has reproduced the performance of an index or several indices (CAC 40, all French indices, Nasdaq, etc.). For Michael Saylor, MicroStrategy has become the equivalent of a fund which has reproduced the evolution of bitcoin, and which offers its shareholders to facilitate their investments in cryptocurrency (without a portfolio, etc.), via the stock market and not through a specialized marketplace (Coinbase, etc.).

If the strategy seemed miraculous in 2021 – MicroStrategy’s stock rose from $100 in April 2020 to over $1,000 in February 2021 – it suffered a severe correction, falling back to $150 in June 2022.

Since then, and as of the date of this article, the stock has rebounded around $280. A strong nominee which also testifies to the preponderance of the new activity of MicroStrategy.

MicroStrategy stays in BI

Former CFO and Chairman Phong Le succeeds Michael Saylor as CEO. The mission assigned to him is to develop and relaunch MicroStrategy’s BI activity.

The new CEO is called upon to lead the publisher’s cloud strategy. This involves convincing customers to migrate their workloads to the SaaS platform while making sure to welcome newcomers, and to increase the average basket of those who have already taken the plunge into the cloud.

In terms of analytics and BI, the publisher is innovating, but slowly, and instead puts on the “openness” of its platform. Clearly, MicroStrategy isn’t targeting exactly the same audience as Tableau or PowerBI. It offers embedded analytics and BI features that developers can use to make them available to businesses or end customers. By way of comparison, the French publisher Toucan Toco adopts more or less the same strategy.

This year, MicroStrategy has strengthened its libraries and tools needed by application designers. This includes, among other things, better support for Python and the progressive support for transactional operations via the Transaction Grid function.

Finally, the publisher has also focused on optimizing and managing workloads for performance purposes. Administrators also have access to more governance features to control access to data, content (reports, folders, etc.) and applications by users. An evolution that goes hand in hand with a subscription system that customers can set up to monetize their applications.

In addition, MicroStrategy intends to strengthen the security of its platform. For example, the May update introduced a data row protection mechanism within its data warehouse. At the same time, the publisher is assisting in obtaining FedRAMP certification to launch its MicroStrategy Cloud for Government. A certification that he should obtain during the month of August.

Crypto-investments that weigh down the bottom line

These additions dovetail with the company’s focus on its BI business: providing an analytics platform for business, a strong focus on embedded analytics, and the cloud.

Still, with its investments in bitcoin, MicroStrategy posted record net income of $1.3 billion over 12 rolling months. $1.3 billion loss…

A situation that some BI customers could end up finding “at risk” for the sustainability of their supplier.

Leave a Comment