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BarterItOnline.com
offers equity trading for services By Brian Cook, dbusiness.com WESTON, Mass., May 17 (dbusiness.com) -- Operators of cash strapped start-ups in need services such as public relations, advertising or Web design have a new way of paying -- they can fork over some equity in their company instead of cash. At least that's Richard Cravatts' idea. Cravatts is founder and chief executive of BarterItOnline.com, a Weston, Mass.-based Web site that allows small- and medium-sized businesses and entrepreneurs to barter for goods and services. This week Cravatts began ofering the equity trade feature in his e-marketplace. Cravatts is convinced that by enabling start-ups to trade part of their equity and future earnings for what normally would be current cash outlays, entrepreneurs gain greater flexibility. It also could mean a comfort level for the venture capital community who find so much of its early-stage investment being consumed by expensive marketing and advertising costs, Cravatts contended. Entrepreneurs can trade equity in their firms to buy these services. So far no dot-coms have signed up for the equity deal, Cravatts said. Cravatts is the sole employee of BarterItOnline.com, which he calls a "virtual" company. He operates the business from his home office in Weston, Mass. For 20 years Cravatts, was publisher of the Boston Classical Network, and played a key role in launching new consumer magazines such as Greater Boston Restaurant & Wine Review and Orlando's Best. In September 1999 he founded privately held BarterItOnline.com. He has recruited four others to work for the company. But while they are board members they are not yet full-time employees. That will happen, Cravatts said when the business takes off. "Right now we work as a virtual company," he said. The chairman of the company is Ira Jackson, former commissioner of revenue for the state of Massachusetts and until recently an executive vice president of BankBoston, now owned by Fleet Bank Other executives include Stuart Zakon, a Web designer and e-commerce architect; Joanne Scheuble, director of the site's Barter Rewards Program and a former director of marketing and public relations for the Boston Ballet; and Warren S. Naphtal, who is serving as chief financial officer but is currently the chief investment officer of P/E Investments of Weston, Mass., a firm he co-founded. BarterItOnline.com facilitates trading between businesses and professionals by creating a virtual currency, called "e-dollars," which members use to buy and sell at the site. Purchases and sales are recorded by the exchange, which receives a transaction fee ranging from 4 percent to 8 percent from the buyer at the time of the purchase. Initial funding for the company came from Publications Management Co., a regional publishing firm with a bartered media division. Cravatts told dbusiness.com that he is talking to outside investment firms while seeking partners to co-brand the Barteritonline.com site. Will it catch on? Cravatts said that bartering has been going on inside the business community for years and he believes that offering to play the middleman by featuring it online will attract more businesses to the ancient art. Brian Cook covers Boston for dbusiness.com. http://www.dbusiness.com/Story/Print/0,1197,BOS_128831,00.html
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