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August 15, 2000

In this week's report. . .

  • BarterNet's continued roll-up
  • Priceline uses barter to entice investors
  • In-kind donations are a form of barter
  • Here and there. . .

BarterNet Continues Rapid Roll-up

BarterNet Corporation has added another four exchanges, and 5,800 businesses, to its rapidly growing roster of established barter organizations expanding the network to over 20,000 businesses. The four exchanges have options to merge with BarterNet at a later date.

"BarterNet is run by leaders in the barter industry who are taking the profession to the next level. The key here is experience...and BarterNet knows how to run trade exchanges," claimed David Wallach, president of ValueCard.

Wallach applauds BarterNet for its leadership. "This dynamic organization is being run by barter veterans," Wallach continued, "and that's why it makes sense for us to join with them. They know that success is considerably more than putting up a web site. BarterNet understands that successful barter is all about relationships and service."

Cagan's Global Play Will Continue

"Our network now integrates 13 of the largest exchanges in America, and our recruitment drive continues to enlist those whose leadership over the past decades has built the barter business to its present robust level," said Laird Cagan, BarterNet co-founder, chairman and CEO.

"With our expansion into California, we now have just over 20,000 members who soon will be trading with each other...and other exchange members around the world. Without the Internet to tie our network members together the task of introducing distant businesses to one another would be an expensive and cumbersome process," Cagan declared.

Four New California Affiliates

ValueCard (www.valuecard-usa.com) was founded as The American Trade Association in 1979 and has grown to 3,500 clients...becoming the largest trade exchange in Northern California. They serve the Bay Area's nine counties with offices in San Francisco, San Jose, and Santa Rosa.

American Commerce Exchange (ACX), based in Glendale, is the largest independent trade exchange in Los Angeles. ACX (www.acxbarter.com) was established in 1982 and serves a membership of 600 businesses. ACX is a member of the National Association of Trade Exchanges (NATE) and the Glendale Chamber of Commerce.

BarterNet (www.barternet.net) was established in 1982. The Brentwood based exchange manages trade for more than 950 business members in the Bay Area and Central Valley of Northern California, with offices in Livermore, Modesto, Dublin, Concord, and Placerville. BarterNet is a member of the International Reciprocal Trade Association (IRTA) and. NATE.

TradeAmericanCard (TAC) is one of the largest independent trade exchanges in California and the largest in Southern California, serving 750 businesses in and around Orange County since 1970. For more information about TAC visit www.tradeamericancard.com.

Priceline.com Uses Barter "Sweetener" To Secure Investors

Two prominent investors, Microsoft Corp. co-founder Paul G. Allen and John Malone of Liberty Media Corp, took advantage of Priceline.com founder Jay Walker's barter sweetener when they agreed not to take ownership of the 8 million shares (of Priceline stock) they purchased...for at least a year.

Walker said the deferral is intended to avoid the possibility of depressing the stock price. Allen and Malone, in exchange for agreeing to wait a year were provided with a nice sweetener...options in Walker's closely held Walker Digital Corp. (Walker Digital owns patent rights to many of Walker's inventions and a 4% stake in Priceline.com.)

Another Form of Barter Seldom Considered

In-kind donations are a form of barter, as something of value is provided in exchange for charitable deduction and good publicity.

Microsoft is now involved in such an effort. It's an international philanthropic initiative to train teachers to better use technology in the classroom. They're providing $344 million in software and support. (No cash is involved.)

The Redmond (WA) company's software donation represents the value of those products if purchased at retail. The cost to Microsoft is substantially lower, as is the amount the corporation can take as a charitable deduction.

Here And There. . .

  • For the first time the two political parties used the web to hype their conventions. Stirring up the party faithful and positioning their candidates for the homestretch to the November election. Internet companies are bartering, by making in-kind donations of their services, to garner more exposure which will ultimately boost their business.

  • When NBC sealed its historic deal for the broadcast rights to the Olympic Games from 2000 through 2008, barter played a role. Executive Dick Ebersol, whose mandate was to make NBC a major player in sports, offered a barter enticement to both the Sydney and the Salt Lake City organizing committees...$10 million a piece in promotional air-time for their acceptance of the NBC Olympic Offer.

    (Qantas Chairman Gary Pemberton, who headed the Sydney organizing committee, asked for and got $705 million for the Sydney TV rights, more than any other organizing committee for any previous Olympics had gotten.)

 

We welcome your comments, questions, and observations.
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