Joint Stock Athletes

FEW lines of work are more precarious than the American footballer’s—his average professional career is limited to just 3.2 years. However, for the handful of stars who stay healthy, football can offer a decent living: Peyton Manning, the Denver Broncos’ quarterback, has pulled in over $200m.

Given this uncertainty, football players have a strong incentive to lock in a base level of compensation. Other celebrities, most famously the singer David Bowie, have used their income streams to secure debt. But salaries in the National Football League (NFL) are so mercurial they could never be used as collateral. The only way for athletes to share their risk fully is to sell an equity interest in their earnings.

Now shares in athletes may be coming to the masses. On October 17th Fantex, a start-up in San Francisco, registered with the SEC a “convertible tracking stock” whose value would be tied to the brand of Arian Foster, an NFL running back. The company has agreed to pay Mr Foster $10m up front in exchange for 20% of total future earnings related to his brand, including endorsements and broadcasting or coaching jobs. Of that cut, 95% will go into a “tracking stock” for investors, who would profit only after Fantex’s expenses and other liabilities are paid. Buyers would apparently be taking a bet as much on the fortunes of Fantex as on Mr Foster’s career. Buck French, the head of Fantex, says he hopes that owners of the stock will play ball by promoting Mr Foster on social media.

The deal will go through only if the $10m can be raised.

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