[benjulmag]

Here's how the offering is described. I highlighted in red the portion of interest.

IN BRIEF
Deemed one of “the single most important and miraculous baseball card(s) in the world” and “perhaps the most significant card in the sports card universe,” Collectable is humbled to present one of the greatest historical artifacts in collectibles, period, a 1914 Baltimore News Babe Ruth - his first card and minor league baseball card. One of only 10 cards known to exist, this particular copy has been displayed at the Babe Ruth Museum in Baltimore, MD for the past 23 years and will continue to reside there so shareholders can go and see it. This card was recently graded a 3 by SGC, and recently set a record for the most expensive sports card ever sold, surpassing the $5.2M price for a 1952 Topps Mickey Mantle and a 2003 Exquisite LeBron James rookie card. A true once-in-a-lifetime opportunity to own a piece of sports history.
THE ATHLETE
Babe Ruth, nicknamed “The Bambino” and “The Sultan of Swat”, is considered baseball’s first great slugger and the most celebrated athlete of his time. He won 7 World Series championships and was inducted into baseball’s Hall of Fame, Major League Baseball’s All-Century Team, and All-Time Team. His career spanned 22 seasons, from 1914 through 1935, beginning as a star left-handed pitcher for the Boston Red Sox. Yet he achieved his greatest fame as a slugging outfielder for the New York Yankees. Ruth established many MLB batting (and some pitching) records, including career home runs (714), runs batted in (RBIs) (2,213), bases on balls (2,062), slugging percentage (.690), and on-base plus slugging (OPS) (1.164). Ruth is regarded as one of the greatest sports heroes in American culture.

THE OFFERING
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One of only 10 Baltimore News Ruth cards to exist, this card is considered by most to be one of, if not the holy grail, in the entire sports collectibles universe.
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Described as a “find of a lifetime” and “one of the great rarities in the hobby” by PSA. Robert Edwards Auctions deemed “the single most important and miraculous baseball card(s) in the world.”
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To date, there are 10 copies on the PSA and SGC population report combined, 3 graded by PSA and now 7 by SGC. For context, the famous T206 Honus Wagner has an estimated 57 copies that we know of in existence and a speculated 60 to 200 ever issued.
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This card predates the Major League rookie card for Babe Ruth (M101-4 and M101-5) by 2 years. While extremely valuable and coveted, those Ruth rookie cards are far more available and accessible than the hallowed 1914 Baltimore News edition.
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This asset was recently purchased by a private collector who wishes to remain anonymous for an undisclosed sum; however, sources have confirmed it represents the most expensive purchase in sports card history, surpassing the $5.2M sums recently paid for a 1952 Topps Mickey Mantle PSA 9 and a LeBron James rookie card.
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For 23 years the card has been showcased at the Babe Ruth Museum in Baltimore, MD. In 2010, The Baltimore Sun published an article in search of the rightful owner as he was unable to be located. Shortly after the article was published, Glenn Davis quickly emerged as the son of Richard Davis, the owner who had recently died. Richard’s father Archibald Davis acquired the card as a young boy when he was selling newspapers. The card came inserted in the Baltimore News where Archibald kept one.
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The card will be displayed at the Babe Ruth Museum in Baltimore, MD, where shareholders can go and visit their asset in person!
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In partnership with the private owner, Collectable will issue a limited number of shares to the public at IPO. The owner may release more shares to the public, similar to a secondary offering, at a later date.
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Sports Collectors Daily spotlighted the 1914 Baltimore News set and the Ruth card in 2019. To learn more about the asset, click HERE!


SHARE PRICE
$3.00
INVESTED
Retained Equity
99.0%
Invested
0.0%
INVESTORS
0
FINANCIALS
Price per share
$3.00
Number of shares available
-
Market cap

I am new to Collectible so I might be misunderstanding something, but it seems to say that the owner is retaining 99% interest, and the 1% they are selling will be sold at $3 per share. If the initial valuation is $6M, that means there will be 20,000 shares that will be sold.

Here's what concerns me. At $3 per share, I can easily foresee an instance where the shares will be valued less on what the card is reasonably worth but more on the appeal of being able to say that one is a partial owner of a Baltimore News Ruth, arguably the most valuable sports card in existence. An IPO of the Boston Celtics some years ago comes to mind as an example of such a mindset. At such a low share valuation, who cares if in order to own a few shares one had to pay $4 per share, or even $5, $6 or $7? In the scheme of things it is still chump change. So let's imagine others feel the same way and the share price rises to, say, $5.

What has just happened? Presto, the value of a BN Ruth has just increased by $4M from $6M to $10M. What's then to stop the owner who retained 99% interest through an alternate entity to offer $15M for the card, which for the 20,000 shares outstanding equates to $7.50 per share? Collectable giddily says the offer has been accepted, as they pat themselves on the back for generating a return of 150% on the initial $3 per share "investment". The original owner through his alternate entity then writes a $15M check to Collectible, of which $14,850,000 less Collectible's underwriting fee will be returned to the original owner as payment for their 99% interest.

Under this scenario, for a net $90K ($150K less the $60K from the original offering) plus the underwriting fee, the original owner once again has (though this time through their alternate entity) 100% ownership, only now of a $15M card. Neat, isn't it?

In outlining all this I want again to stress that I am new to how Collectable works, and it is possible there is more to it than I described. And too even if there isn't I am in no way suggesting the original card owner or Collectible is thinking along these lines. But if the events I laid out are allowed to take place, then this is yet another example of how in a unregulated industry such as sports collectibles there is tremendous economic incentive for schemes such as this to take place.