From our BarterNews files of 1999:
Staggering Barter Agreement Jump-Starts New Business
Talk about an agreement that helped both parties ... Union Bank of
Switzerland (UBS) decided to give their business to new computer
services start-up Perot Systems in 1996. They did so because, in
addition to a good price and a promise of extra-special service,
they were given an option to buy 7 million shares of Perot Systems
stock at $3.65 a share, when the company went public.
Perot Systems made such an agreement because they needed a
substantial contract, and had to �outbid� their bigger rivals IBM
and EDS.
The UBS contract accounted for 25% of Perot�s revenue. On the second
day of trading after going public in February 1999, less than three
years after the contract and barter agreement was signed, Perot
Systems� stock was selling at about $61 a share. And UBS was holding
a $400 million windfall!
How did founder Ross Perot fare on this barter deal with UBS, an
agreement that admittedly jump-started his new company? His 38%
stake in the company was valued at $1.4 billion. (Additionally, it
was the substantial UBS contract that enabled Perot Systems to go
public as quickly as it did.)
The barter technique (and perspective) used by Ross Perot isn�t
limited to super huge deals. You can, and should, use the concept �
regardless of your company�s size. What�s required is an awareness
by you that a barter component can be the determining factor in a
new business contract.
What should you offer? That depends on the situation, which a little
research will reveal. However, an exceptionally versatile commodity
you�ll always want to consider is trade credits. They�re valuable
and can be used in a variety of different ways by the other party.
