The following is a sponsored post from Finlete.
For as long as anyone can remember, sports fans have sought to grow closer to the games, teams, and players they so passionately support, investing everything from their time to their emotions to their money. From Duke University students camping out in tents to get prime seats, to baseball fans buying up rookie card stacks, to football fans purchasing real stakes in Real Madrid CF and the Green Bay Packers. Of course the internet and smartphones changed the game, with fantasy sports’ popularity exploding about 20 years ago and sports betting exploding over the last 10 years.
Today, how we spend money on sports continues to rapidly evolve, including the ability to invest in athletes’ careers in exchange for a piece of their future earnings. It’s a corner of the sports world that’s starting to make some serious noise and sports investment platform Finlete is a key player.
In 2024, Finlete bookended the year by giving fans the opportunity to invest in the careers of MLB prospects Echedry Vargas and Leonardo Bernal.
Vargas, ranked #16 in the Miami Marlins system (source MLB.com), is a Dominican middle infielder who boasts an aggressive approach and an impressive power-speed combo that ultimately made him a key piece in Miami’s return for Jake Burger this winter. Bernal, the most recent athlete to join Finlete, plies his trade behind the dish as the #9 prospect in St. Louis’ system (source MLB.com) with a keen eye, strong arm, and lots of loud contact.
For potential investors who may lean more mainstream, 3-time AL All-Star Emmanuel Clase became the first Major Leaguer to sign with Finlete in the middle of his historic season and give his legion of fans a shot to join his journey financially. As far as big name investing goes, it doesn’t get much bigger than a certified Cy Young candidate in the prime of his career.
With a growing slate of professional athletes set to be announced in 2025, Finlete is evolving quickly and building upon the foundation set by some pioneers in the sports investment world.
Fantex, which operated from 2012-2016 and allowed fans to buy and sell securities tied to athletes’ contracts, is a great example of being ahead of your time. Fans were able to invest in the careers of Vernon Davis, Alshon Jeffery, and other NFL players, but this was before the tidal waves of crowdfunding and alternative investments rolled in.
Since then, investing in athletes’ careers has been dominated by private hedge funds such as Big League Advance (BLA) and X10 – the former founded by an ex-MLB player and the latter founded by ex-Fantex execs. Not everyone is eligible to invest in a hedge fund and even those who qualify may not have access. It’s exclusive and restrictive. That’s where new companies like Finlete come in, applying lessons learned from Fantex while democratizing access to the kind of investing BLA and X10 have been doing over the last 5-10 years.
For example, BLA successfully signed several future MLB All-Stars including Elly De La Cruz, Jazz Chisholm Jr., and Fernando Tatis Jr. in the early days of their professional baseball careers, well before they became household names.
The model is simple: Pay prospects an upfront payment in exchange for a percentage of their potential future MLB earnings.
For the athlete, it’s cash now for cash later. It’s giving up a small piece of their potential upside in exchange for more security now. And it’s risk-free in the sense that it’s not a loan, the athlete only owes the investor money if they make it to the big leagues and even then it’s only a small percentage of their MLB salary. The cash up front also helps increase their chances of making it pro.
Elly De La Cruz is a prototypical example. He signed with the Cincinnati Reds in 2018 for $65,000, a fairly small account considering these signing bonuses range from $10,000 to over $9 million. The additional funds from BLA allowed him to supplement that signing bonus and his meager Minor League Baseball (MiLB) salary, which helped him cover basic expenses, finance his training, support his family, and better prepare himself for the grind of the long seasons ahead. The funds often also mean the player can focus on baseball year-round instead of needing to work another job in the offseason.
On the other side of the deal, BLA received a percentage of Elly’s potential future MLB salary. Whereas the player risks losing some upside by having to give up a piece of their earnings if they make it in the big leagues, the investor – BLA in this case – risks loss of capital, as it’s an investment, not a loan, and there’s no guarantee MiLB players will make it to or stick around at the MLB level.
Finlete believes athletes signing these deals with hedge funds is a missed opportunity though. By signing with Finlete instead, athletes can let people from all walks of life be the investors and in so doing build a strong following of extremely dedicated fans. By linking athletes and fans financially, Finlete is taking fan engagement to the next level, as the fans the athletes garner through Finlete will remain fans of theirs for their entire careers, regardless of what team they play for.
While having disposable income always makes investing easier, acquiring a financial stake in a real athlete’s career is exceedingly accessible for the general public. Finlete investors, for example, are able to invest for as little as $300. Bonus shares on the platform are also available for investments of $1,000 or more.
This is a lot like the fractional investment opportunities that have taken shape in other industries. Want to invest in art? Try Masterworks. Real estate? Go with Fundrise or Happy Nest. Tech startups? Look at Wefunder or Republic. The common denominator is that it’s easier than ever to invest in whatever piques your interest. The question now is – what comes next?
For those who choose Finlete, the answer is more. More athletes, more experiences, more perks, more ways to engage with athletes, and ultimately more opportunities to combine a love of the game with real investing. The future of sports investment is here and it’s an exciting outlook for 2025.
