Arian Foster IPO: Sociologist Casts Doubt Over Stocks in Pro Athletes

One Arian Foster for sale -- slightly used.
A new San Francisco startup that turns star athletes into stocks is already promising big paydays for all players involved -- even with a roster of one.

Two weeks ago Fantex Holdings unveiled plans for an IPO, having negotiated a deal with Houston Texans running back Arian Foster that guaranteed the company 20 percent of Foster's future earnings. In return, Foster garnered a $10 million lump sum -- probably less than what Fantex will make by selling more than a million $10 shares over its own trading platform.

If the idea of buying stock in a human makes you uneasy, rest assured, you're in good company.

While critics compare Fantex to a gussied-up form of fantasy football, scholars argue that the investment scheme could pose a danger to athletes.

In fact, the fantasy football model proves instructive, according to Harry Edwards, a UC Berkeley professor emeritus who specializes in the sociology of sports. "If fans get vicious and vitriolic as a consequence of an athlete's performance on their fantasy team, what is going to be their reaction when they have [actual money] on him?" Edwards asks. He adds that once an athlete signs his soul away to an investment startup, it's no longer clear who he works for -- the team, the franchise, the shareholders, or himself.

Now that the ink has dried on Foster's Fantex contract, investors can lay claim on any sports-related enterprise he pursues in the future, from commercials, to broadcasting, to sponsorships. If Foster releases a line of collectible bobbleheads, they'll take cuts from that, too.

Then there's the uncertainty of any pro sports career, particularly for an injury-prone running back who, as some commentators note, is already a bit long in the tooth. "The shareholders are gambling -- albeit a market-type gamble -- that over time the athlete's value is going to increase," Edwards continues. "This is an exceedingly risky bet."

Many skeptics agree with that sentiment, and some saw an eerie harbinger in Foster's recent debilitating hamstring injury, which removed him from a match against the Kansas City Chiefs right around the time Fantex was filing for its IPO. Still, if the running back's recent spate of endorsements -- from Toyota, Mobil, and the gaming company Electronic Arts, among others -- are any indication, he'll certain make a windfall for somebody.

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