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Donald Trump endorsed the Bible this week. You may have thought God's presence was enough for the faithful on Easter, but the former US president has licensed his name, likeness and image for the God Bless the USA Bible book, which retails for $59.99. “All Americans need a Bible in their homes and I have a lot of it. It's my favorite book,” he says charmingly in a video on his Truth Social website.
The Bible pales in comparison to Truth Social itself as a wealth-generating venture associated with the Trump brand. He became $4.6 billion richer on Tuesday, at least on paper, when his shares in parent company Trump Media & Technology Group rose sharply as it went public under the stock ticker DJT. “It's hot as a gun and does a great job,” he said earlier. For once, he wasn't exaggerating.
The initial public offering and its surprising impact on Trump's net worth is as unlikely as the hero's narrow escape from danger in an action movie, given the financial straits he finds himself in. He faces a costly presidential campaign, numerous legal issues, and must raise $175 million to delay the execution of a $464 million fraud conviction in New York courts.
So it's a good thing that Trump has devoted his adult life to honing the financial value of his personal brand. In terms of investment, his social media company's valuation is ludicrous: A platform that lost $49 million on revenue of $3.4 million in the first nine months of last year isn't worth billions. His bottom line is that a lot of Trump fans don't think that way.
“Most people will look at what happened today and think to themselves I should have tripled my numbers [holding] “From #DJT stock when its price was so low,” one supporter wrote on Truth Social, adding a money bag emoji. Wall Street professionals' doubts about their intrinsic value made little difference: buying stocks was an expression of faith in their political hero.
It sounds like the meme stock craze of 2021, when small investors banded together to drive up shares in GameStop and others. Meeting on the WallStreetBets subreddit, they were happy to put pressure on short sellers and brag about their resilience. A similar two-way struggle has broken out at TMTG, with short sellers losing money so far.
This is not the end of the story. Many meme stocks similarly rose in a wave of fan-backed investment and then fell again, as did special purpose acquisition companies (Spacs). TMTG became a publicly traded company after merging with a cash-rich special purpose acquisition company called Digital World Acquisition Corp, several of whose founders took legal action.
There's also a rich history of IPOs of companies whose digital sheen has lost its early luster, from TheGlobe.com to Vonage. TMTG shows few signs of having firmer foundations than these. Truth Social was launched as a free speech platform after Trump was banned from Twitter, but its user base has shrunk since Twitter (now X) veered into similar territory under Elon Musk, who called it back.
But all this may be beside the point. Many die-hard Trump fans treat it as a form of financial donation that they wouldn't be too sad to lose. Since the former president owns 58 percent of the shares, he can significantly increase his net worth at a relatively low personal cost: and this is not the first time he has discovered a nifty money-making tool.
Their loyalty will be tested in six months, when the hold on Trump's shares expires and he can cash out his billions (if they still exist) and become the biggest seller ever. He has form: DJT Bar was once associated with his Atlantic City casino and hotel business, which entered bankruptcy protection. “The money I took from there was unbelievable,” he once said.
However, I imagine many of those who hold their stock high until then will still be happy to have the service. And given the level of conspiracy theory on Truth Social about every event, from the war in Ukraine to this week's Baltimore bridge disaster, Trump can blame forces beyond his control.
This will be the ultimate payoff for being a global celebrity with a fan base. In fact, the gap between TMTG's revenue and its valuation is a measure of its intangible brand value. Kim Kardashian's clothing company, Skims, was valued at about $4 billion in July, but was on track to do $750 million in sales in 2023. Trump's stake in TMTG would be worth less than $200 million on that basis.
No matter how improbable Trump's new gains may be, one cannot say they were an accident. Since he first went to the Studio 54 nightclub in the 1970s to hang out with New York celebrities, he has been a devoted student of personal branding. He has attached his name to many products over the years, from casinos and magazines to vodka and now social media.
His newfound billions may evaporate, but they are there for now. Once upon a time, Bernie Kornfeld, founder of the failed pyramid selling empire in the 1960s, promoted mutual funds with the slogan: “Do you sincerely want to get rich?” Trump is certainly sincere about that.
john.gapper@ft.com
