Friday, February 1, 2008
Sports You too can own a piece of Tribe minor leaguer Randy Newsom
Posted by Pete Kotz on Fri, Feb 1, 2008 at 4:53 PM
When I was younger baseball fan, still young enough to bring a mitt to the ballpark without ridicule, I saved my allowance until I had $20 to buy a Sandy Alomar Jr. rookie card. I’m not sure it was ever worth $20. And it’d probably be worth almost nothing today, even if I didn’t stick it in my spokes years back. Such are the breaks of investing in baseball.
Now that I’m older, I’ve moved on from the small-time hobby of buying baseball cards to the big-time world of buying baseball players. Today, I plunked down $20 of my sort-of-hard-earned money as an investment in Randy Newsom, a 25-year-old side-armed reliever in the Indians farm system who split time between Single and Double-A last year…
Newsom is not only a baseball player; he’s also a businessman, and possibly even a decent one. Along with two of his ex-teammates, Newsome is the founder of Real Sports Investments. The premise is simple, we think. (We don’t understand it exactly, but we suspect you will. Maybe you can explain it to us at the bar sometime.)
Basically, Minor league players put up a percentage of their future Major League earnings in exchange for cash in hand right now, to be spent on Skoal, nudie mags, and other things to help pass the time during bus rides to Pawtucket and Scranton. Newsom, for example, is offering to sell up to four percent of his future Major League earnings, should he ever get there. Each share cost $20, and is worth .0016 percent of whatever salary he doesn’t slyly ship to his account in Antigua before you catch wind of his contract. For now, he’s offering up to 2,500 shares.
Newsom, a self-described “anti-prospect,” is probably not what your money guy was talking about when he encouraged you to diversify. Even with solid stats at Akron last year (3.12 ERA, 4-1 record in 47 appearances), he’s a long shot to make the majors, and an even longer shot to make millions. Making baseball’s minimum salary (somewhere in the neighborhood of $350,000), it would take him three full seasons to repay shareholders if he sells all 2,500. As a 25-year-old righty whose fastball doesn’t climb over 85 mph, you’re probably better off keeping your money where it is, safely invested in an assortment of cured meats.
Nevertheless, the idea’s fascinating. Minor leaguers don’t make much money, can’t afford nutritionists and other specialists that might help them climb the baseball ladder, and need to ingest copious amounts of beer like the rest of us. To give them $50,000 upfront, risking just 4 percent of their future salary, is a no-brainer -- especially when you have fantasy geeks and morons like me willing to fork over the money.
We’re not total dummies though. Newsom’s going straight in my bike spokes like my old baseball cards if this investment tanks. – Vince Grzegorek
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You did not invest in this guy, you happened to read about it in Crain's Cleveland. Newsome refunded everyone their 'investment' after threats of the SEC getting involved.
Posted by JMFS
on February 3, 2008 at 11:42 AM
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