Think Megan Fox is Sexy? I’ll Sell You 1 Share of “Synthetic Ownership Interest” for $10

Megan Fox is sexy. Really sexy. And if you’ve ever wanted a piece of action, you have your chance. Starting today, I’m selling 1,000 shares of “synthetic ownership interest” in Megan Fox for $10/each. It’s my version of the IPO – the Initial Pussy Offering.

If this sounds utterly ridiculous to you, the concept of a startup called OneSeason will too. Which is probably why it has raised $3.5 million in VC funding.

The concept of OneSeason is simple: turn popular athletes into stocks and allow the public to trade them in a market.

There’s only one problem, of course: you don’t own anything. Although you might be able to negotiate fractional ownership of someone like Mike Tyson, chances are that athletes like Tiger Woods and LeBron James are not going to turn incorporate, run everything through their corporations and sell off ownership interests to the public.

But that isn’t stopping OneSeason from selling shares of them.

If it sounds sketchy, that’s because it is. While I can’t be bothered to call an attorney to discuss the theoretical legal issues OneSeason raises, it takes little more than common sense to recognize that OneSeason is in effect little more than a scam regardless of whether or not it’s intentionally malicious.

The three biggest problems beyond any questions of legality:

• Nothing tangible drives the market. Since “synthetic ownership interests” are vapor, there are no underlying fundamentals (such as profits or the likelihood of a certain outcome) on which to base their value. The OneSeason homepage says “Value’s [sic] based on public perception” but this is misleading in my opinion based on the following.
• Liquidity is limited. In thinly-traded markets like OneSeason, a single person could have a considerable impact on the price of an SOI at any given time (with or without the intent of manipulation). Since OneSeason doesn’t use market makers, for instance, your ability to buy and sell SOIs is wholly dependent upon finding a counterparty for a trade. While a discussion of market markers and specialists is beyond the scope of this post, any person with reasonable sophistication recognizes the unattractive risks of such illiquid markets.

At best, OneSeason is entertainment. The fact that a dead person (Babe Ruth) is traded highlights how ludicrous OneSeason is. Unless you’re betting on the Babe rising from the dead and signing a $75 million/year deal with the Yankees, trading “synthetic ownership interests” in him makes about as much sense as trading “synthetic ownership interests” in unicorns.

Which begs the question: why involve real money in such a market anyway? ProTrade runs a similar exchange using fake currency that can later be exchanged for real prizes. Makes sense. Fake ownership interests, fake money.

While none of this is to say that there won’t be some people who get lucky and make money “trading” on OneSeason, the worst investment of all may be that of its lead investor, Charles River Ventures.

OneSeason users can only deposit a maximum of $2,500 year into their accounts because the friendly folks at OneSeason “want to ensure that this is used only for fun and entertainment purposes.”

Given this, it’s hard to see how OneSeason is ever going to attract type of volume (in terms of trades executed and total dollar value) required to grow into the type of business that VCs should be investing $3.5 million in.

For those who actually want the opportunity to make real money in sports markets, betting exchanges like Betfair and Betdaq provide the best means.

And for those who want to spend money on entertainment, contact me about my Megan Fox synthetic ownership interests. I’ll throw in some Megan Fox photos too; consider them to be your stock certificates.

At least by the time my business selling synthetic ownership interests in hot female celebrities collapses (as OneSeason eventually will), you’ll have photos to remember the good times by.