Discover how Metaplanet became the top global stock by adopting Bitcoin as treasury asset. CEO Simon Gerovich shares strategies, valuation insights, and future plans for non-financial audiences.
Timestamped Overview
[00:00:00 - 00:03:15] Optimism for Bitcoin Treasury Companies
- Bitcoin treasury companies are like businesses that save and grow money by holding Bitcoin, a type of digital currency that’s becoming popular worldwide.
- More companies are starting to use Bitcoin as a safe way to store value, making it easier for regular people and big investors to get involved without buying Bitcoin directly.
- Big investors, like banks or funds, couldn’t easily invest in Bitcoin before, but now these companies provide a simple way for them to join in.
- In places like Japan, where savings earn very little interest, people are excited about new ways to grow money through Bitcoin.
- The host introduces a podcast series on these companies, highlighting how Metaplanet turned a small struggling business into a huge success in just over a year by focusing on Bitcoin.
[00:03:16 - 00:05:17] The 555 Capital Raise Plan
- Metaplanet announced a big plan called “555” to raise money, which means “go, go, go” in Japanese and is fun with numbers that people like.
- This plan aims to almost double the company’s shares to buy more Bitcoin, making Metaplanet one of the biggest holders of Bitcoin globally.
- They raised money by letting thousands of everyday people buy shares directly, turning them into supporters who help the company grow.
- The number 555 was chosen because it was successful in a past fundraiser and fits with Japanese love for lucky or meaningful numbers.
- The goal is to have enough money by the end of the year to keep buying Bitcoin and expand the business.
[00:05:45 - 00:11:45] Moving Strike Warrants for Fundraising
- In Japan, companies can’t easily sell new shares like in the US, so Metaplanet uses a tool called moving strike warrants to raise money fairly without hurting share owners.
- This method lets them sell shares at good prices, sometimes even higher than normal, to bring in cash for buying Bitcoin.
- They’ve done this three times successfully, raising hundreds of millions of dollars quickly because there’s a lot of interest in their stock.
- Unlike past uses where this tool hurt companies, Metaplanet makes it friendly for everyone involved, avoiding big losses.
- Their partner, Evo, helps by buying shares in a trustworthy way, building on a long relationship that started years ago with smaller deals.
[00:12:31 - 00:14:23] Bonds and Consistent Bitcoin Buying
- Metaplanet issues special loans called zero-coupon bonds to their partner Evo, which are like advance payments with no extra cost, to buy Bitcoin even when share prices are low.
- This helps them keep buying Bitcoin steadily, no matter if the stock market is up or down, without waiting for good times.
- The bonds act like temporary money that can be paid back with new shares later, making it a smart way to grow their Bitcoin savings.
- It’s a win-win partnership because Evo trusts Metaplanet and both benefit from the company’s growth.
- This setup lets Metaplanet speed up buying Bitcoin, using it as a main way to raise money over time.
[00:14:23 - 00:23:39] Put Options Strategy for Extra Income
- Metaplanet uses a strategy called selling put options, which is like promising to buy Bitcoin at a set price later, earning extra money as a reward if the price stays high.
- It’s not about protecting against losses but a positive bet on Bitcoin growing, helping them make steady income to cover costs.
- They set aside a small part of their money (up to 5%) for this, expecting to earn $20-25 million this year, which is more than enough for their low expenses.
- A put option is like insurance for others who worry about Bitcoin prices dropping; Metaplanet sells this “insurance” and gets paid, using the money wisely.
- They’ve been doing this for about eight months, testing different timings and prices to get the best results, always buying Bitcoin quickly when they can.
[00:23:39 - 00:28:43] Preferred Shares and Yield Opportunities
- Preferred shares are like special investments that pay a steady return, and Metaplanet is exploring issuing them in Japan where people want better earnings than low bank interest.
- In Japan, there’s not much of this market yet, but with trillions in savings earning nothing, a Bitcoin-backed option could be very appealing at 3-5% return.
- Compared to the US where similar investments pay higher (8-10%), Japan’s low rates make even a small return exciting for investors.
- Metaplanet believes their simple setup with just Bitcoin as the main asset makes them a safer choice than complicated companies like SoftBank.
- They’re inspired by other companies proving demand for these investments, planning to grow their Bitcoin holdings first to make bigger deals.
[00:28:43 - 00:34:20] US Expansion and Investor Interest
- Metaplanet started a new office in Miami, Florida, because it’s friendly to digital money like Bitcoin and helps attract US workers and better buying options.
- The US has the biggest money markets, so being there lets them connect with more investors and buy Bitcoin more easily than in Japan.
- In Switzerland, big investors are surprisingly interested in Bitcoin companies, knowing they can’t buy Bitcoin directly but can invest in stocks like Metaplanet’s.
- These investors look for companies with good trading volume and size, and Metaplanet now fits, leading to positive talks.
- More Bitcoin treasury companies worldwide are helping everyday people and big funds get into Bitcoin safely.
[00:34:40 - 00:39:12] Views on MNAV and Future Growth
- MNAV is like a score showing how much a company’s shares are worth compared to its Bitcoin holdings; higher scores mean easier growth with less share dilution.
- Investors have different opinions: some buy when it’s high to bet on fast growth, others see value when it’s low.
- Metaplanet aims for a balanced range (3-6 times) to guide their money-raising, being more active when it’s high.
- They focus on growing Bitcoin per share, not just holding it, to show real progress.
- Overall, there’s excitement for more money flowing into these companies, offering ways for all kinds of investors to join the Bitcoin trend.
Notable Quotes
Bitcoin Treasury Definition
A Bitcoin treasury company has a single purpose and that is to acquire as much Bitcoin as possible, to accrete more Bitcoin onto the balance sheet on behalf of all shareholders.
Simon Gerovich @gerovich
Pivoting to Bitcoin
We were inspired by MicroStrategy in the US and we decided to adopt the same plan a little over a year ago after really looking at limited options that were available to us as a struggling hotel company.
Simon Gerovich @gerovich
Decision Process
I went through a very similar process that Michael Saylor went through and many people who have listened to his early podcasts would know that he went through this process of figuring out what to do with the cash on his balance sheet, worrying that those dollars would lose value with every minute that passes.
Simon Gerovich @gerovich
Bitcoin as Store of Value
After looking at literally every possible investment opportunity out there concluded that Bitcoin was the best asset to purchase and be something that stores value over the long term.
Simon Gerovich @gerovich
Company Background
We originally acquired the company when I was running a hotel business: we realized when we entered Japan that in order to get financing from Japanese banks, to be taken seriously by potential investors, to be a public company would be very useful.
Simon Gerovich @gerovich
Impact of COVID
Coming into COVID we were at the top of the world: prior to COVID we had grown our hotel platform to 30 hotels in Thailand, Philippines, Indonesia, and then Japan, and then literally with a single global health scare, health issue, we went from top of the world to struggling.
Simon Gerovich @gerovich
Future of Capital
You were the fastest growing company I think in the world last year in stock market returns — you did in 2024 2,400% if my data is correct — that puts you in the #1 position.
Richard Byworth @richardbyworth