Fantex Signs 49ers' Davis To IPO Deal For 10% Of His Future Earnings
S.F.-based sports technology startup Fantex CEO Buck French said Thursday that the company "will now have the rights to 10%" of 49ers TE Vernon Davis' future earnings "including his playing contract, endorsements and post career interests" as it plans to sell shares of the player, according to Darren Rovell of ESPN.com. Fantex paid Davis $4M upfront for the deal, which is in place for "as long as they can finance the deal." The company said that it will "create a tracking stock that will enable fans to buy a piece of Fantex but specifically trade Davis' stock depending on how his brand is performing." Davis earlier this month "lost an endorsement deal he had just signed" with coconut water brand Vita Coco "after he tweeted about rival drink BodyArmor." Davis "has other endorsements with Force Factor sports supplements and beef jerky brand Krave." Davis is the second NFLer to sign on with Fantex, after Texans RB Arian Foster earlier this month became a client (ESPN.com, 10/31).
POUND FOOLISH? In N.Y., Peter Lattman wrote since it was announced two weeks ago, Fantex' "innovation has caused a stir on Wall Street and in the sports world." Market commentators have "raised questions about the soundness of the deal for investors, citing its complex structure and many risks, including the chance that an injury could cut short a player’s career and earnings potential" (NYTIMES.com, 10/31).