Numerous large companies and institutions have entered the bitcoin space over the past year or so with significant purchases worth billions of dollars in total. Keeping in mind that some of these names were giants like Tesla, MicroStrategy, Ruffer Investment and MassMutual, it is normal that they all made the news more than once.
But what about the so-called guy? Because it is considered a very volatile and risky asset with a little over a decade long history, BTC does not sound like the preferred asset for smaller businesses to compile their balance sheets, does it?
However, this does not appear to be the case for a small pizza business owned by men and women, with two joint ventures in Alabama, USA, called Sam & Greg’s Pizzeria / Gelateria.
Greg Hathorn, the co-owner (also known as the man), recently commented on a Michael Saylor endorsement of Square’s $ 170 million BTC purchase that they have moved $ 200,000 of their business’ balance sheet to the primary cryptocurrency.
CryptoPotato reached out to the Hathorns to find out more about their decision, thoughts on bitcoin, exit strategy and everything in between.
Why Bitcoin, Greg?
The deepest question for any (new) investor is probably why he or she decided to allocate funds in a certain asset – or as a popular American and British author once wrote – “it all starts with the why.”
Greg shared with us that his background was in IT, despite his ongoing restaurants, and said that cryptocurrency and blockchain technology had been in his sights for some time.
While acknowledging that he was too late with the ‘ah-ha moment’, he believes that ‘these technologies are the smartest use of the internet to date, creating a positive disruption that will leave traditional finances at its core stumble.’
‘Then why bitcoin for my business? The simple answer is that I have worked hard to save money, and that I do not like to despise and weaken it. I also do not appreciate that politicians and central banks reduce the value of the American worker to the speed of a printer. Bitcoin solves these problems.
The simple forces of a fixed supply and unlimited demand are at play, making bitcoin the obvious choice as a valuable store for those who simply need a place to store capital, regardless of the size of the business. ‘
350% ROI in less than a year
Greg reveals that the catalyst for this decision came in April 2020 – a crucial moment for the cryptocurrency industry as well as the entire financial field. The COVID-19 eruption has just been recognized as a global pandemic, and the effects have spread across all financial markets, causing massive noses.
Bitcoin was not excluded, as it fell by 50% to below $ 4,000 in mid-March 2020. However, the Hathorns seem to have followed the Paul Tudor Jones III approach and moved to bitcoin when the asset began to recover has.
Nevertheless, BTC did not just stop with a mere recovery and went to new heights in the next eleven months. It’s no surprise that Hathorns’ bitcoin investment is “about 350% higher since we started investing last year.”
Greg noted that he preferred to go with Grayscale instead of the “crypto exchange route, because I just did not want to deal with the maintenance of a digital wallet, cold storage / hot storage, keys, etc.” He believes that the GBTC trust is one of the easiest tools for people who currently want to receive BTC exposure, but believes that the potential approval of a Bitcoin ETF could be a game changer.
Asked about their overall strategy for bitcoin, Greg told us that he does not actively manage the cryptocurrency position. Instead, he prefers HODLing for now.
However, he plans to handle his “prudent” BTC investment slightly differently in the future – “I will take profits on track, and then invest again on future declines.”
Other small businesses should also consider buying BTC
While it is still not a common practice among larger or smaller businesses, Greg believes that every owner or manager should ‘at least’ teach themselves about bitcoin ‘before consciously deciding whether to buy BTC as well.
“Bitcoin, and cryptocurrency in general, is not disappearing, so it should not be ignored as a fad that will fade.” he claimed.
While acknowledging the improved volatility of the asset, he does not feel it is risky – “or at least not riskier than investing in stocks, market ETFs or just cash.” He and his wife have invested in BTC funds that ‘are in addition to the working capital that remains in the business to meet the ongoing cash flow needs.’
As such, it is prepared to face short-term volatility, despite the ‘stomach ailments that occur when bitcoin declines and consolidates’, to ‘take up massive long-term gains’. He also feels privileged to be an early adopter of this ‘new digital monetary network – an opportunity I can not let go of.’
Greg also noted that the company’s BTC investment could ultimately benefit their staff as well, as it offers job security and potential bonuses. He said ‘they were excited’ the first time he and his wife announced the bitcoin purchase.
‘They thought that if we got it right, things should go well with the business, which means job insurance. But, more importantly, I plan to include a portion of any Bitcoin profit in our annual bonus pool, which is shared by all employees. So you can say that our staff is invested in Bitcoin. ‘- he concluded.
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