In this Open Letter to Trevor Dietz and the other Directors of Bartercard, I advise them of the concerns that I have over their IPO; inform them of my intent to continue examination of their business and continued blogging of their business conduct. I detail specific areas of my concerns and call on them to suspend the IPO until the issues are addressed in a professional and ethical manner.
Open Letter to the Directors of BPS Technology [Bartercard]
Dear Trevor & others
You will no doubt be aware of my recent blogging in regards to Bartercard’s IPO.
Your company has featured prominently in The Barter Series, a 61,000 word flurry of expose, commentary and opinion that has been less then complementary about your business conduct and the quality of the information contained in the BPS Technology Prospectus. Since then I have further blogged analysing the changes that you made to the Prospectus on 5 August, 2014.
I wish to highlight the nature of my concerns, inform you of my intent to continue a longterm commentary on your companies conduct, and recommend that you reconsider suspending your IPO until you address the core concerns constructively.
First, you have failed to respond to anything I have blogged about – not once have you exercised my Right of Reply. You have my personal email address and obviously do not wish to communicate. Ignoring specific claims of misinformation in your documentation indicates to the public that my claims have validity. Any company with an offer that genuinely stacks up would address any concerns constructively. You clearly either don’t care [for your IPO was presubscribed anyway] or you have something to hide.
Second, you have acted on the subjects of my blogging with a half-hearted attempt to covering your true intent with an ammended Prospectus beefing up claims that I called you to account for. In doing so you have revealed more about the sham.
Third, you are going public on the basis of a VERY dubious agreement for exclusive endorsement from IRTA. It was negotiated in secret (the IRTA Members and even some of the IRTA Board never knew anything about it) and it only because public knowledge as a result of your IPO parading it as a fait accomplis and then my blogging about it! Considering that you (Trevor) have stated that this agreement was the reason that you even considered going public one would consider it an important factor in your IPO and doubt over IRTA’s capacity to honour the agreement has to put your projections into doubt.
Fourth, you do not reveal your agreements either with IRTA or any other related party nor will you enter into discussion. This requires investors to trust your marketing spiel which is, in my opinion, a lot of fancy-talk. I struggle to see you ready to move into a new level with a public company whilst you are operating with hidden agreements, and thinking that the marketplace is foolish enough to just trust you. I think you will need to lift your game substantially in the disclosure department or you will fall foul of the authorities, get trashed by the financial media and commentators like me time after time. You’re definitely not ready for the big-time.
Fifth, your business conduct is not in keeping with that of a publicly listed company. As I have shown in my blogging, your current  business practice in the UK is predatory and unethical by every measurement factor. You will face trauma at every turn of your immoral practices and be exposed with one disaster after another. As a private company you can live with this, not so a public company. When you and your team lead by example your team members may lift their game, but of course being honest would mean that your IPO should be suspended and left until you are profitable and ethical.
Sixth, your horrendous undisclosed Trade Deficit may be a clever and creative use of accounting functions but it will come back to bite you in the marketplace when the word gets out and your members learn of the hidden inflation of your currency. You may be able to bury the deficit in a throw-away company and avoid paying the tax; you may be able to keep up the con as you prop up the Ponzi scheme that the Bartercard Trade Dollar is but sir, as a public company the value of your Barter Dollar will come under a lot more scrutiny than it ever did when you were private. Better to suspend the IPO, take a hit and then re-apply for the monies you seek. Of course we both know that with your off-balance so insanely huge that this is a total impossibility but hey, going public will just mean your fall will be far more spectacular.
Seventh, you fail to mention your steady downturn from the last 5 years of trading. Going public is best after a few years of POSITIVE growth, not on the tail of years of loss. From the little that I know about IPOs, most companies will structure their affairs to present an attractive IPO based on REAL performance, not a pipedream miracle turnaround in a market and areas that you have failed spectacularly previously.
Eighth, you appear to have not looked after your current minor shareholders. Perhaps you have forgotten them for they have had little dividend going back a few years now . . . this does not bode well for your new investors.
Lastly there is dissatisfaction with your leadership since you took over the company. Perhaps you should shore-up support, build trust and ensure loyalty with your current team before launching into the big wide world again? Your operation leaks like a sieve, has widespread dissatisfaction and low moral, that’s even before we look at the ethics department.
Trevor, sir, I counsel you to revisit the whole IPO and (even if you have pre-subscribed) do the honourable thing and suspend the IPO process. Considering all the above I believe that proceeding with the IPO is foolhardy and has the potential to expose investors to inevitable loss and disillusionment and that addressing the very real concerns I mention here, is best done without the burden of expectations of your new investors.
I intend to continue making pertinent comments about your business conduct moving forward.
I intend to follow, monitor and report things to do with Bartercard as I come across them. My tipline is working well in that regard and as always I extend you the Right of Reply should I get anything wrong, or if you wish to make comments of your own.
Dennis A. Smith
Author, Blogger & IT Entrepreneur
The Barter Series
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