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How the Understanding of Long Distance Communications Technology Shaped the Fortunes of Peter Loftin’s BTI

May 7th, 2018 | by Benny Sanderson
How the Understanding of Long Distance Communications Technology Shaped the Fortunes of Peter Loftin’s BTI
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Destiny has its own way of getting us where it wants, when it wants. When Peter Loftin got bored from his sales job in Florida, he returned in 1980 to Raleigh, NC. He wanted to join college again in North Carolina, but couldn’t finish more than two semesters.

Learning sales and long distance together
Peter Loftin again started selling office supplies and when he got some free time at night, he scrolled through business magazines looking for different opportunities. That might be destiny’s call probably. The news stories that were majorly been featured those days were about the breakup of AT &T. But, he had to begin somewhere and his first instinct asked him to sell telephone equipment.

Peter Loftin started with the basics. He bought cordless phones at wholesale price and went on selling them door to door in the evenings. His targeted areas included the upper middle class localities of Raleigh, North Carolina. Though, he was craving for something more permanent, than the door to door sales job, so he started to make a plan to launch a telephone store.

Development of a business plan

Peter Loftin stumbled through some books on telephone revenues and was surprised to find that most of the entries were on long distance. It planted the seed of his new business in his mind. He talked to one of his cordless phone customers Woody Byrd to come along with him for a new business venture. The business venture required the purchase of a system that comprises of video microwave towers between the state of Washington and Atlanta to enable them to transmit telephonic conversations and data. Its estimated cost was $50 million.

Finding an investor
Woody Byrd was in a chemical brokerage business. He left his business for a year and invested around $25,000 into this new project, even though he felt Loftin was inexperienced, but his dedication and attention to details impressed Byrd.  Loftin was 15 years younger than his partner Byrd and it was difficult for him to teach someone so senior about how to do business and how to make a business plan. Clash of egos was a big probability, but luckily that didn’t happen as Byrd was also an experienced professional and he identified Loftin’s hidden talent.

Trying times
Peter Loftin again experienced a misfortune, when they were very close to finding an investor, who was the president of the New York Textile Company, but just a day before the deal was about to be signed, some negative story published in the Wall Street Journal about the bleak future of long distance businesses and the investor changed his mind.

It forced them to change their business plan again. They were now looking for a business that didn’t require as much capital. Then, a friend arranged a meeting between Peter Loftin and Andrews, when he heard that Loftin was interested in a long distance business.

Back with old guys
Woodson and Andrews were the investors Loftin had worked earlier during the launch of BTI. They were also running a long distance company together named Discount Watts Lines and they had invested around $250, 000 in it. It was the same company that Loftin had warned them about.

It lost around $300,000 in the first year of its inception. He was convinced that the founder did not understand the industry and that was the reason the investment was going down the drain. According to Peter Loftin, it was not the time to think about serving both the types of customers — residential and business customers. The more profitable market was business customers. Long distance was pretty expensive at that time especially on weekdays.

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