Edison shrugged off the falling out with his early partners and continued to pursue his dealings with outside benefactors. Aside from providing much-needed capital, Marshall Lefferts, head of the Gold & Stock Telegraph Company, hoped to use Edison to expand his company’s dominance of the printing telegraph technology, which was the mainstay of the stock reporting business. Edison willingly contributed his expertise, and in early 1870 received two lucrative contracts from Lefferts for improving stock printers, plus a significant stipend to cover rental of space for a laboratory and the required equipment. With this financial backing, Edison moved to Newark, New Jersey, and, along with machinist William Unger, opened up a laboratory under the name of Newark Telegraph Works.
During this time Edison had been diligently working on a “special ticker,” which would become the ubiquitous “Universal Stock Printer” used in New York, London, and other major financial centers. Lefferts, who was called General to honor his Civil War service, had been funding development and wanted Edison to wrap it up. After calling the 23-year-old Edison into his office, Lefferts asked, “Now, young man, I want to close up the matter of your inventions. How much do you think you should receive?” Edison considered, and estimated about $5000 based on his time and effort, but figured he could accept $3000. Fortunately, he lost his nerve at suggesting this seemingly huge sum of money, and said, “Well, General, suppose you make me an offer.”
Edison nearly fainted. He had always based his consulting service on the amount of time needed to develop a new product, but now he realized that a price based on the value of the product to the buyer was more important. He had learned a valuable business lesson that would help him considerably in the future.
[Adapted from Edison: The Inventor of the Modern World]