The problem with this is the moral hazard.
Farming out his equity decreases the incentive for Foster to perform well.
When you buy a share in a company, you are theoretically an owner in the company and thus have a say in the company's decision-making, on top of the claim on dividends.
I imagine that when you buy a share in an athlete, you do not have a say in what the athlete does--else it would be close to indentured servitude. You more or less become a debt holder with an equity risk profile--but worse, due to the moral hazard involved.
I'm guessing the investors in this are in it to eventually find greater fools to sell to.
Farming out his equity decreases the incentive for Foster to perform well.
When you buy a share in a company, you are theoretically an owner in the company and thus have a say in the company's decision-making, on top of the claim on dividends.
I imagine that when you buy a share in an athlete, you do not have a say in what the athlete does--else it would be close to indentured servitude. You more or less become a debt holder with an equity risk profile--but worse, due to the moral hazard involved.
I'm guessing the investors in this are in it to eventually find greater fools to sell to.
#NoSingleMoms
#NoHymenNoDiamond
#DontWantDaughters