Perspective: Newsom eyes save opportunity

While some Minor Leaguers spend their offseason getting in a little R&R, others find part-time jobs such as working for UPS or substitute teaching to pay the bills. Still others head to warmer climes such as the Caribbean or Mexico to play winter ball. But Randy Newsom of the Cleveland Indians managed to combine several of the above with something completely different.

Newsom, a right-handed reliever who spent most of the '07 season at Double-A Akron, joined forces with Red Sox outfield prospect Bryan Pritz and former Oakland farmhand Mike McGirr to create Real Sports Investments (www.realsportsinvestments.com), a company which allows investors to purchase shares of participating Minor Leaguers' future Major League earnings.

That money paid up front for "shares" of a player go directly to the prospect to offset his current costs of living.

If the player makes it to the Majors, a percentage of his annual Major League earnings (which will vary from 2 to 8 percent but will be preset in advance of the offering) will be set aside to be paid back to the investors on an annual basis for as long as he is in the bigs.

Basically, think fantasy league baseball experience crossed with the stock market.

But with this investment, the money makes an immediate tangible difference in the players' lives.

While some fans assume that pro ballplayers live in that rarefied financial stratosphere of, say, an A-Rod, only the "bonus babies" such as first-round draft picks and that handful of elite international signees enjoy that kind of stability until they make it to the big leagues.

Most players, especially those who are married and/or have families to support, not only have to pay their in-season living expenses but also their rent or mortgage payments back home.

Factor in the difficulty of finding a job that will pay those bills from September to February and it becomes clearer that it's not Easy Street.

These factors were the impetus behind RSI.

"I realized that the higher we get, a lot of guys who would probably be in the big leagues in the next few years, without this opportunity now, may not be able to hold on that long," said Newsom, who paid his bills during the 2006-2007 offseason by teaching Advanced Placement English at Medford High School outside of Boston. "I thought there had to be a way to help them get by."

Newsom started chatting with Pritz, with whom he was already business partners in a company called Lacers (www.lacersonline.com) which specializes in customized sports equipment embroidery, about how a program could be set up to help defray the living expenses for such on-the-cusp players.

It turned out that McGirr, who was Pritz's college buddy from Richmond and who went on to Cornell Business School after his playing days were done, had written a business plan on the same topic and the trio created RSI.

The concept is simple: Investors purchase shares of an RSI athlete through an initial offering, with the athlete receiving a one-time upfront payment.

While the return varies based on taxes and other factors, a general ballpark figure -- so to speak -- suggests once a player hits a salary of $1.25 million per year, his investors make their money back. They will be paid on a yearly basis (see accompanying chart).

And for this first offering, Newsom is playing guinea pig and putting his future money where his mouth is. Or where his arm is.

The company is offering 2,500 shares of the sidearmer at $20 a share.

Newsom, 25, was originally signed by Boston as a non-drafted free agent out of Tufts University before being traded to Cleveland in 2006 as the player to be named later in the deal for outfielder Coco Crisp.

By that season's end the Cincinnati native had been named the Most Valuable Player of the Carolina League Championship Series and had combined between two stops for a 3.24 ERA in 72 1/3 innings, giving up just one home run with his hard Frisbee slider, sinker and changeup.

He spent most of 2007 at Double-A Akron, posting a 3.12 ERA and collecting 18 saves in 36 games.

Newsom harbors no grand illusions about becoming the next Lee Smith or Trevor Hoffman, but he strongly believes there is a place in the big leagues for a pitcher like him.

"As a sidearmer you're never going to be 'The Guy,'" said Newsom. "But (Baltimore submariner reliever) Chad Bradford was never 'The Guy' either and he signed a three-year deal for $12 million."

In this day and age, Newsom believes, there is a valuable role to be played by someone who can come in on a regular basis and consistently get outs.

"Sidearmers dominated the 1980s and then they went to the power arm," he explained, "but now people are starting to realize that getting a ground ball when you need it is a good thing to do against professional hitters."

If you're thinking about going to RSI and buy up all 2,500 shares of Randy Newsom, though, forget about it. For Newsom and any subsequent RSI offerings, no individual will be allowed to buy more than 5 percent of the shares offered for a given player.

"While we appreciate and encourage investors to want to buy more than one share," he said, "we had to limit it to make sure there was a chance for many fans to get involved and to keep the investments small enough that no fan can hurt their overall financial well-being."

Newsom and company, all of whom have substantial business education backgrounds, are well aware of corporate scandals of the past and were careful to make sure that they learned their history lessons well.

"That, coupled with the fact that we don't want to do anything to reflect badly on baseball in any way, we refuse to put baseball in a situation that could harm them," Newsom said, "or in any way compromise the integrity of our company, our players or baseball."

Set up as a private offering, potential investors can become members of RSI through a basic but detailed online process that would take them through all of the terms and conditions.

"It is important that it's regulated because we want to protect both the players and the fans," explained Newsom. "We want to make sure the integrity of the whole process is at 100 percent."

Newsom stresses that investor participation offers much more than just dreams of financial gain, because what RSI comes down to, really, is an unprecedented chance for fans to have an interactive opportunity to participate in a player's career.

"We think this is a win-win situation (for fans and players)," Newsom said, "and are really hoping that this both helps players become more financially stable and allows fans an enhanced spectator experience."

RSI already has more players waiting in the wings to see how this all plays out in the coming months.

RSI's network of lawyers and businessmen have vetted all of the paperwork carefully before letting it get off the ground to make sure there would not be any conflicts with any of the other powers that be in baseball.

"We would never go forward with this if we had any indication that this would be anything but positive for the players, fans and the integrity and community of the game," Newsom said.