The New York Times’ Alan Schwartz on a business initiative concocted by a right-handed Cleveland relief prospect / Tufts grad, whose plans were previously brought to light by Baseball Prospectus :
Randy Newsom, a reliever last season for the Cleveland Indians™ Class A and AA affiliates, set up a Web site through which fans and other outsiders could purchase a piece of his future major league earnings. Through Thursday, Newsom had sold about 1,800 shares of himself at $20 apiece. Each share afforded the bearer .002 percent of his career pay, uniting his goals with investors who hope he makes it big.Dozens of minor leaguers had expressed interest in also going public through Newsom™s new company, Real Sports Investments, he said. Unfortunately for Newsom, however, his plan did not exactly thrill M.L.B., the players union or the Securities and Exchange Commission.
Offerings shopped over the Internet must be registered with the S.E.C., and Newsom™s was not. After speaking with a lawyer for M.L.B. on Thursday afternoon, Newsom decided to table his idea to work with authorities on a venture they would approve and perhaps even support.
œWe want to pause to hear everyone™s concerns, Newsom said, adding that he would refund $36,000 to his hundreds of investors. œThis idea is not going away. This is assured by the amount of fan support, and the amount of players we talked to, that the support is there. The spirit of this idea will go on.
That idea, Newsom said, was to supplement minor leaguers™ meager wages ” usually about $8,000 for a five-month season ” while building a unique bond among fans and players.
œPeople get up and look at their players™ stats every day, and root for them as they go through the minor leagues, said Newsom, who is considered only a marginal major league prospect because of his below-average fastball. œThis can be the same type of thing, where fans have a tiny vested interest in hoping a guy does well.
Converting future earnings into upfront revenue is not new in business or sports; David Bowie has sold his royalty rights in the form of offshore bonds, and young golfers are often backed by speculative businessmen. Here, rather than collect inanimate rookie cards, fans would invest in tiny pieces of real farmhands.
Under the tabled plan, whereby he would have sold off 5 percent of any future major league income, Newsom would have needed to earn about $2 million for his shareholders to break even. That would have required a career of at least three full seasons, which for a player of Newsom™s caliber ” he called himself the œquintessential antiprospect ” is unlikely.
If the union would ok it I’d give it a try. I have to make some money back somehow, the CSTB stock I own is like the fucking Titanic.