Vestible co-founders on investing in athletes' earnings
Illustration: Annelise Capossela/Axios
A new startup called Vestible imagines a world where most athletes are acting like their own stocks, with fans able to buy shares in their future earnings.
Why it matters: The startup, which recently received SEC clearance, is the latest gambit that allows people to directly invest in celebrities' earning power.
How it works: Vestible, founded by former Oklahoma State football players Parker Graham and Yves Batoba, so far has one athlete signed up: Denver Broncos linebacker Baron Browning.
- Athletes are treated the same as a new stock debuting on the exchange, in that there's an initial offering and then shares in the athletes' earnings can be traded after that closes.
- Primary offerings go for $10 a share, and 80% of the money raised goes directly to the athlete.
- Over $100,000 has been invested in Browning's stock since the offering went live in May, after Vestible received SEC and FINRA clearance.
The big picture: Fans investing in their favorite celebrities or athletes is nothing new.
- David Bowie memorably offered so-called "Bowie Bonds" in the late 1990s, which were bonds backed by future revenue from his song catalog.
- There have been other recent, similar efforts in sports from firms like Fantex and Big League Advance. Fantex, which had signed 20 athletes to give up a portion of their endorsement earnings, closed after five years in 2017.
- But Batoba tells Axios today's fan is "the most sophisticated sports fan ever" and that platforms like Robinhood have made millennials more investment-savvy for their age compared to previous generations.
- "You got fans out here who are creating podcasts, and they know the inner workings of salary caps as well as any point history, as well as the GM," Batoba says.
Zoom in: Vestible looks for athletes who are outperforming their rookie contracts.
- Browning fits that mold: A third-round pick in 2021, he is heading into the last year of his rookie contract — his base salary will be just over $3 million this coming season — and is viewed as a key cog for the Broncos' defense.
- "That next contract is the real question, and that's why investors would want to invest in Baron as he could be making anywhere from $13 million to $20 million next year," Graham says.
What's next: Vestible said it is adding two college football athletes who are expected to be first-round draft picks, as well as an NBA player.
