History
Saylor started MicroStrategy in 1989 with a consulting contract from DuPont, which provided Saylor with $250,000 in start-up capital and office space in Wilmington, Delaware. Saylor was soon joined by company co-founder Sanju Bansal, whom he had met while the two were students at Massachusetts Institute of Technology (MIT).[12] The company produced software for data mining and business intelligence using nonlinear mathematics,[7] an idea inspired by a course on systems-dynamics theory that they took at MIT.[13]
In 1992, MicroStrategy gained its first major client when it signed a $10 million contract with McDonald's. It increased revenues by 100% each year between 1990 and 1996.[12] In 1994, the company's offices and its 50 employees moved from Delaware to Tysons Corner, Virginia.[14]
On June 11, 1998, MicroStrategy became a public company via an initial public offering. The company sold 36 million shares of its common stock, each share priced at $6, under the stock ticker "MSTR" on the NASDAQ stock exchange.[15]
In 2000, MicroStrategy founded Alarm.com as part of its research and development unit.[16]
On March 20, 2000, after a review of its accounting practices, MicroStrategy announced that it would restate its financial results for the preceding two years.[17] Its stock price, which had risen from $7 per share to as high as $333 per share in a year, fell to $120 per share, or 62%, in a day in what is regarded as the bursting of the dot-com bubble.[18]
Following MicroStrategy Inc.'s March 20, 2000 announcement that it had significantly overstated its 1998 and 1999 revenues, approximately two dozen class action securities fraud actions were filed in the United States District Court for the Eastern District of Virginia against MicroStrategy.[19] In December 2000, the U.S. Securities and Exchange Commission brought charges against the company and its executives.[20] A lawsuit was subsequently filed against MicroStrategy and certain of its officials over fraud.[21] In December 2000, Saylor, Bansal, and the company's former CFO settled with the SEC without admitting wrongdoing, each paying $350,000 in fines. The officers also paid a combined total of $10 million in disgorgement. The company settled with the SEC, hiring an independent director to ensure regulatory compliance.[22][23]
In February 2009, MicroStrategy sold Alarm.com to venture capital firm ABS Capital Partners for $27.7 million.[16] The company introduced OLAP Services with a shared data set cache to accelerate reports and ad hoc queries.[24] In 2010, the company began developing and deploying business intelligence software for mobile platforms, such as the iPhone and iPad.[25]
In 2011, MicroStrategy expanded its offerings to include a cloud-based service, MicroStrategy Cloud.[26]
In 2013, MicroStrategy sold Angel to Genesys Telecommunications Laboratories for $110 million.[27][28]
In August 2022, the attorney general for the District of Columbia sued Saylor for tax fraud, accusing him of illegally avoiding more than $25 million in D.C. taxes by pretending to be a resident of other jurisdictions. MicroStrategy was accused of collaborating with Saylor to facilitate his tax evasion by misreporting his residential address to local and federal tax authorities and failing to withhold D.C. taxes.[29] MicroStrategy said the case is "a personal tax matter involving Mr. Saylor" and called the claims against the company "false" and it would "defend aggressively against this overreach."[30] In June 2024, Saylor and MicroStrategy reached a $40 million settlement agreement with the District of Columbia.[31]
Saylor resigned as CEO effective August 8, 2022. Phong Le, who had been president, succeeded him. Saylor remains the executive chairman of MicroStrategy. In a press release announcing the transition, Saylor said that he would focus on the company's bitcoin acquisition strategy and that Phong would manage overall corporate operations.[9]
