How A Start-up Microbrewery Used Barter
"Norm!" The famous greeting from the gang at Cheers has a new twist around Boston these days. Now it's "Al"--because Bartermax President Al Kafka has helped put together an innovative new start-up deal with the folks from the Great Providence Brewing Co.
It happened when the principals of a new microbrewery pitched their idea to Kafka. He quickly was "on tap," and eager to help make the deal happen. Here's a "draught" of how barter was creatively put to work to get a new business brewing...
The Great Providence Brewing Company (originally the Connecticut-based Great Atlantic Brewing Company) was referred to Bartermax through one of their enthusiastic members. The fledgling company, eager to start up a local microbrewery in New England, found itself in the same position as most new ventures: short on cash, with limited capital, and no means of getting the word out to potential investors.
And, instead of following the usual practice of retaining an investment banker to offer new stock to the public, Great Providence was looking to market its shares directly to local beer drinkers.
Essentially that means they're looking for guys like Norm, and his buddy Cliff, (and Carla of course--never count her out of anything), to buy a round, and become investors.
When Kafka was first approached, the company's immediate goal was to find an advertising agency that would help get the word out about a stock offering. They needed to identify and target the right markets. They needed to develop a creative strategy.
And produce ads. And prepare broadcast spots. And provide on-air talent. And to coordinate the services of a fulfillment house, (a company that provides and services an 800 number to respond to investor inquiries).
With little money, these ambitious goals seemed impossible. Enter Bartermax...as a member the microbrewery traded stock in the company for trade credits. These were used to purchase the goods and services needed to successfully launch the business.
The arrangement provided the new company with $50,000 in radio advertising, $20,000 in advertising and public relations agency services, and thousands of dollars in related products and services. All without one dime in cash!
In April of this year, Bartermax-Providence members, Target Group (an advertising and public relations firm), as well as several radio stations and voice-over talent Ron Hayden, all poured themselves into this unique barter plan.
They collectively helped Great Providence Brewing to reach its goal of 20,000 telephone inquiries. (The prospectus initiated so much interest from listeners, that the company exceeded its goal--having to turn away callers from other states, who were not eligible.)
The company is now positioned to begin a radio blitz in the Boston market, and to advance their plans for brewing and bottling. An effort that will eventually bring some fifty new jobs to the city of Providence--due in great part to the help of Bartermax!
is published quarterly by BarterNews 2005©. All rights reserved.
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