It has been typical over the years for investors to buy stock in non-team athletes. This includes boxers, golfers, tennis players and so on. But Fantex has a pushed the limits even further. They will soon allow team athletes, such as Arian Foster, to offer their “brand” to the public.
Fantex Offers The Arian Foster Brand to The Public
Part of this story sounds far fetched, but here is how it works.
Fantex is paying the Houston Texans’ running back $10 million up front. In return, Fantex will receive 20 percent of Foster’s future income, whether it be contracts, endorsements, or other business ventures.
Investors can buy stock and will be enticed to do so when Foster performs well on the field. Things like performance may make endorsers more interested in signing a deal with Arian. If this is the case, his stock may go up.
Every time interested fans buy stock in Foster, Fantex will get a commission. Foster’s stock could be live in about a month.
The idea may sound far-fetched, but this has been done by the likes of Sugar Ray Leonard and Rich Beem.
When Reggie Bush was asked about the idea, he seemed skeptical:
“It’s like buying stock in anything. It’s kind of like you’re gambling a little bit. I have bonds, municipal bonds and stuff like that, but that’s a little different than buying stock in a person. It sounds very weird,”
At the same time, Reggie’s teammate Nate Burleson was optimistic about the endeavor:
“It’s appropriate for those two type of athletes, the megastars and those who are really business-minded. Using the NFL to further themselves as a platform for something much bigger for the rest of their lives. So yeah, I think it’s good.”
Fantex’ offering of player stock is a legitimate tracking stock. “Every share you buy on Fantex represents ownership in the series of common stock of Fantex, Inc. that is linked to the economic performance and value of the brand of a professional athlete – such as income earned from contracts, endorsements and appearance fees.”
Fantex, Inc. creates a unique brand building platform for athletes to increase the reach and engagement of their brand. Fantex, Inc. signs a contract with an athlete to acquire a minority interest in their brand and builds a plan with a goal to increase its value, leveraging Fantex, Inc.’s marketing expertise.
Take a look at the promotional video for Arian Foster here. What do you think about buying stock in a professional athlete?
Photo credit – techcrunch.com