Red Eagle Lands Bartercard

Tony Falkenstein launched his “drinking water” business Red Eagle Corporation week after the October ’87 sharemarket crash. Now, 14 years on and when world business has been put on hold, he’s done the biggest deal since Red Eagle first took flight.
“It’s great time to buy business in New Zealand,” he says. Falkenstein has been on nine-month sabbatical in the UK. The longer he’s away the more he’s convinced that New Zealand is “land of opportunity” for those with drive, energy and the right attitude toward taking risks.
The Australian-based owners of Bartercard International have retained 10 percent of the New Zealand franchise. The consortium of local investors includes Falkenstein’s Red Eagle, with the lion’s share, and the company’s chief executive, Roy Netzer. “It’s nice to bring company back under local ownership,” says the smiling Falkenstein.
But what has he and his team got to do to ensure the investment succeeds? “Grow the business and grow the people,” according to Netzer. “The trade exchange business is people industry. It’s only as good as the trade coordinators and the trade purchasers.”
And according to both Falkenstein and Netzer their 120-strong team in New Zealand is pretty good. They have built membership base of 5000 companies, generate 50,000 transactions month and do $180 million worth of business each year. That level of business, according to Netzer, is greater on population basis than other Bartercard countries generate, including home turf Australia.
Managing the people, providing them with good systems and motivating them to maintain the buzz and enthusiasm of the “trading exchange-type” atmosphere that drives members to use the barter system for business transaction is the business’ primary focus. “We need people who like dealing with lots of businesses, who like helping people and who love to do deals,” says the former Israeli-based trade exchange trade coordinator who came to New Zealand and joined Bartercard six and half years ago.
To ensure he understands the business and the need to keep people motivated Falkenstein intends spending couple of weeks on one of the company’s trade coordinator training programmes. “This is an exciting business and it suits my personality. I like to think outside the square,” he says. “I won’t be involved in day-to-day management but I really want to understand it. The best way to do that is to spend little time at the coal face.”
After that Falkenstein sees himself bringing ideas to the company and doing some “bigger deals” for the business. Back in 1996 he envisaged taking Red Eagle public. This latest venture will add significant substance to his enterprise should he consider this option again in future.