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Fred Thiel, CEO of MARA, Tells Us Why They Increased Authorized Shares

August 1, 2023

Fred Thiel, CEO of MARA, discusses the recent decision to raise authorized shares from 200 million to 500 million in a YouTube video. Thiel explains that the company faced difficulties in obtaining shareholder votes for previous share increases due to the predominance of retail investors who often don't participate in voting. These votes required significant expenses in hiring proxy solicitors and printing proxies, diverting resources from potential growth opportunities. The increase in authorized shares aims to address this challenge by providing the company with the flexibility to respond to market opportunities swiftly. Thiel emphasizes the importance of optionality, allowing the company to seize advantageous situations in a timely manner. He cites a past example of successfully raising a convertible bond at the market peak, showcasing the significance of being prepared to act when market conditions are favorable. Ultimately, the increase in authorized shares aligns with MARA's strategy to ensure liquidity and maintain the capacity to make timely strategic moves.

00:00 Intro

0:20 Why MARA increased authorized shares

1:45 What is optionality

Transcripts are autogenerated. May contain typos.


from retail investors so we have thousands and thousands of investors many of whom don't vote on matters and so uh we have tried a couple of years in a row to pass increases in our uh authorized shares uh and because you need over 50 percent of your shareholders actually or shared shareholders representing over 50 of your shares um outstanding and issue to vote it can be very hard and very expensive you know we have to hire proxy solicitors we have to print proxies so a lot of expense that's destroying value for our shareholders as


opposed to creating value because we're spending money on something um that uh really uh could be better spent on investing in growth instead and so we said okay let's find a way to get the authorization to increase shares and let's get an authorization that's big enough so we have plenty of shares for the future so we don't have to go back to the mill every year so think of it as optionality we wanted to have enough shares available so we have optionality doesn't mean we're going to use them in the short term the


medium term and maybe not in the long term who knows don't know yet but it gives us optionality and if there's one thing you'll always hear me talk about is you know the one thing you never want to lose is optionality because that gives you the ability to take advantage of luck and luck is really manufactured it's opportunity meets preparation and preparation part of preparation is optionality so we think that having the shares authorized gives us the options now midterm or in the long term to be able


to do things and take advantage of situations in the marketplace to move quickly you know just if you go back to this convertible bond that we raised in late 2021 you know we were able to raise it at the peak of the market um you know again with a one percent coupon on it in a time when you know uh soon thereafter nobody could raise any capital for Bitcoin miners so being able to time markets and do things requires that you're prepared and able to do it and that's why we want to be in a position where we have maximum


optionality love that well said Fred um you know I actually said similar yesterday when I saw it it's important to remain liquid to seize opportunities and as a company increasing your authorized share so you have the capability should you need to seize any opportunities when the time is right like you did with that Bond very smart there and you have that capability so optionality is key very well said I love that perfect that was great