Michael Saylor

Taking stock of people and ideas in the news.
March 23 2000 3:00 AM

Michael Saylor

MicroStrategy's cult leader.

77000_77797_000322_michaelsaylor

On Monday, Michael Saylor lost $6 billion, more money than any human being except has ever lost in a single day. Shares in Saylor's company, MicroStrategy, plunged 62 percent after the firm admitted that its 1999 revenues were 25 percent less than claimed, and its 1999 profit was actually a loss. Wednesday's Washington Post reported that MicroStrategy erroneously booked revenue from two long-term contracts, perhaps jigging the numbers to meet analysts' forecasts. Shareholders have already filed suit. The 35-year-old Saylor, who owns 56 percent of the company, has seen $10 billion—two-thirds of his paper fortune—disappear since the stock peaked two weeks ago.

Advertisement

You would be fazed at losing $6 billion in a single morning. You would fret if your company were pilloried for dubious accounting practices. But tyro billionaire Saylor seems utterly unaffected and largely uninterested. He insisted that his company did nothing wrong, and he moved on. "I signed up to change the world," Saylor likes to say. He compares himself to Thomas Edison, Henry Ford, Andrew Carnegie, and John D. Rockefeller. When you are changing the world, who cares about a few billion dollars here or there?

If Bill Gates and Steve Jobs mated—admittedly an appalling thought—they would have spawned Saylor. Like Gates, Saylor is a ruthless, intimidating nerd. Like Jobs, he is a cult leader, a mesmerizing speaker. An MIT grad who studied aeronautics and computers, Saylor founded MicroStrategy in 1989 when he was 24. He realized that companies were wasting the information they gathered about customers and sales. MicroStrategy quickly became a premier "data-mining" firm, extracting "intelligence" (a favorite Saylorism) from swamps of undifferentiated data. MicroStrategy famously helped Victoria's Secret discover that women in New York buy more black bras and that Midwestern women buy larger bras, causing Victoria's Secret to change how it stocked stores. From busts, MicroStrategy boomed.

By the standards of a mere businessman, Saylor is a star. But money holds little interest for him. He still lives in a dreary Northern Virginia townhouse. He wants to be the philosopher-king. "I have never met someone so obsessive about changing the world," says MicroStrategy spokesman Mark Bisnow. (Saylor is curiously reminiscent of Newt Gingrich: Both spew grand theories, and both have the unshakable sense that they are world historical figures.)

In the past six months, Saylor has taken to the airwaves and to print as a technological avatar. He says he is pioneering a revolutionary business that he calls "telepathic intelligence." Soon, Saylor preaches, everyone will be equipped with a wrist chip and a tiny earplug. Saylor's computers will process massive amounts of data, then tailor it for you. A voice in your ear will caution you not to take that medicine, urge you to sell that stock because it is tumbling, advise you which road to take to avoid traffic. He will turn intelligence into a utility, and he will be its Ford and its Edison.

David Plotz David Plotz

David Plotz is Slate's editor at large. He's the author of The Genius Factory and Good Book.

He will also be education's Carnegie. Last week, Saylor pledged $100 million to launch a free online university. It will collect lectures from the great "geniuses" of the age—John Williams on composing (?), Henry Kissinger on Vietnam (?)—and make them available over the Internet. This will revolutionize learning by allowing "a cab driver in Bombay," Saylor says, to receive "95 percent" of an Ivy League education.

(Saylor does not always dwell on such profound subjects. He has become a quote machine for the Washington Post, opining to the gossip column about private jets and the Gregorian calendar. He makes sure his parties are written up in the Post or Washington Times, and he lets himself be advertised as D.C.'s most eligible bachelor.)

Saylor is taken seriously not simply because he is a rich guy, though that helps. (Principle of Boomtime America: If you have a million dollars, you're a businessman. If you have a billion dollars, you're a visionary.) He is taken seriously because he, like Jobs, can create a "reality distortion field." His intensity and zeal are dazzling. He mesmerizes people. Saylor's grand ideas are perfectly credible, but they're nothing you haven't read in Wired a dozen times. No matter: Saylor's reality distortion field has alchemized MicroStrategy from a respectable data-mining company into some kind of Übercorporation. "Michael has this quality that he can make any product sound like it will revolutionize the world," says David Folger, an analyst who studies MicroStrategy for the Meta Group. MicroStrategy makes "good data-mining software," Folger continues, but not software that is notably better than the competition's. Before its crash, MicroStrategy's price-to-earnings ratio was about 900, 20 times that of competitors. "What Michael has is this magic dust, his aura and personality. That jacks the stock price up," says Folger.

The vaunted "telepathic intelligence" is still a dream: All MicroStrategy offers now is a service that warns you if a stock moves dramatically. There is no reason to believe MicroStrategy holds a competitive advantage in this field. Countless companies are battling to control and deliver all the data needed to make telepathic intelligence real. MicroStrategy may be one of the winners—Saylor is as tough and smart as any of his competitors—but there's no guarantee.

Saylor has long been fascinated with the Roman Empire—he has said he moved MicroStrategy to D.C. because he liked Washington's Roman architecture—and it is a telling obsession. Like the Romans, Saylor is fundamentally authoritarian. He runs MicroStrategy like a paramilitary organization. New hires attend a six-week boot camp. Saylor indoctrinates each batch of new employees with an inspirational sermon that has been known to run eight hours. Each year, employees must attend a weeklong "university," with a mandatory two-hours-a-night study hall. Employees are required to take a weeklong cruise every year—without their spouses. Saylor's fervor wins absolute loyalty from his 2,000 employees.