Another big thing to note here is that this might not even happen. The initial offering (IPO) is only putting about $1 million up for grabs, and if it turns out that no one wants it, Fantex can (will) bail on the whole thing. Because the way the deal works, Fantex is essentially buying $10 million worth of “stock” from Foster himself, who remains a nominal majority shareholder, and then selling that off to fans. And Fantex appears to want no part of holding onto that stock itself—which should probably tell you something.
If the stock actually gets off the ground and functions as a real tracking stock on a custom-made Fantex exchange (comforting), it will effectively mean Arian Foster has bet against his future “brand” earnings: He loses out if that 20 percent of his earnings ends up being worth more than the $10 million he’s being paid for the shares.
Foster would make up some of that in the value of being the public face of fans owning players’ endorsements, but really it’s an insurance policy—risk management in the case that his assets and earning potential dry up tomorrow, due to catastrophic injury or him Michael Vicking himself or whatever else. It’s not unlike how poker players will sell off a percentage of their final earnings in a tournament before the tournament’s over, locking in a profit.