Experiment is Over - Cardtarget closing Partial Share Program

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Posted By: Jim Dale

The cardtarget.com experiment is almost over. Through tomorrow the operators \ owners of cardtarget.com are taking final offers on the cards they purchased and allowed people to share ownership in through their web site. I’m a customer of cardtarget.com and not an investor or partner in anyway so I can only assume this was due to the inability to insure the cards at a reasonable cost and come up with a means of paying for that cost. Cardtarget charged transaction fees on those who sold shares of the cards they acquired, but it wasn’t enough to cover the costs – I assume.

I know this experiment was not well received here, and in fact I was told by some involved at cardtarget not to bring it up here at times. They believed the legal work they did was sufficient, but as we all know there are two sides of any legal debate and it seemed as though most here didn’t like the idea of “shared” ownership of a card. I personally thought they covered all the bases as well as anyone could.

The little community of a 100 or so collectors though did manage to acquire a neat collection – all of which will be sold soon – some of which will be sold by vote of the share holders in the next few days. The collection included six different Broadleaf 460 backs including the GAI Authentic graded Christy Mathewson. It was brought to the community for just $3,750 and has a current bid of $7,400 with the voting due to start in the next few days. As much as that card was a success the other GAI graded cards were a failure. A GAI 9 Yogi Berra 1948 Bowman was brought to market for $5,600 and has a current bid of just $3,000. It was the biggest loser to the community.

Some of those in the community used the ability to buy shares here and there to acquire cards. One person managed to purchase one of just two Ozzie Smith PSA 10 OpeeChee rookie cards and another managed to purchase a John Elway rookie and two rare Harrington Ice Cream Cards. At one point the cardtarget.com collection of cards was valued over $200,000 by the share holders.

My own opinion was that the program at cardtarget could not attract collectors, and speculators found the risk far outweighed the reward. I think collectors might have been willing to pony up the necessary funds for insurance, but there are simply not enough of them willing to own shares of interest in a card – rather then the card themselves.

If I understand what they are doing right now – final bids are being accepted by email to the operators of the site and they will decide if the offers are good enough to put to a vote. Owners of shares will then vote, and if the 75% vote to sell the offer will be accepted, and if not the cards will go to ebay or an auction house, or possibly split between both. I’m bummed because it was fun to own a piece of a few cards I could not own the whole of – especially not in the conditions they obtained.

My favorites were the 36 Back collection including a BL 460 and everything but the impossible 4; the SGC 96 McGinnity and PSA 9 Nap Lajoie T206 cards are just amazing, and the PSA 6 AG Comiskey that I hope to buy out from the community myself – ideally.

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Posted By: Bobby Binder

I think the idea is fine if you are buying stock in companies. But this is Baseball cards and the fun part is having that card in your hands not a portion of it you can never see or hold. I have seen some cardtarget auctions and the prices where very high BIN's but they do have some nice items I must say.

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Posted By: MVSNYC

interesting concept, but too confusing to most (myself included) and too "wall street" like...

i've tried "co-owning" a few cards in the past, and it never worked for me...

cool experiment, nonetheless.

best-
MS

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Posted By: Jason

Sadly, about half of the Broadleaf 460s I brought to market to "share" with others have been taken out. Great premiums on them I suppose, but would've liked to have taken them back privately myself (any buyer that comes in that makes an offer 25% higher than what amounts to the last few average sales can purchase the card without a vote). I suspect you'll see the last few 460s they have taken out in a similar matter before the collection goes up for the masses to bid on.

It will be interesting to see which auction house gets the collection, as there are some extremely nice (and rare to boot) cards.

regards,
Jason

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Posted By: Jason

Bobby,

as an aside, most of those auctions you saw running on ebay were more to advertise than to actually get the cards sold. Though if I'm not mistaken, a couple of cards did sell for what were seemingly high buy-it-now prices. As with all cards, tough to value what they're actually worth when there really are only a couple that exist in such a grade in the world. Someone may have felt they got a steal purchasing at those prices.

regards,
Jason

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Posted By: barrysloate

I was always a little skeptical of this project, but it at least seems to have been run honestly and professionally.

I think part of the fun of putting money into baseball cards is actually having them in one's possession. Buying shares of them is no different than owning shares of IBM, since without holding the cards the only motivation is to make a profit. Hopefully all the share holders will at least reap some benefit from this, which would qualify it as a success.

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Posted By: Adam

" . . . the fun part is having that card in your hands . . ."

I could not agree more. Well, except maybe to say the fun part is having that card "and/or PSA/SGC slab" in your hands . . .

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Posted By: Jim Dale

Barry I would agree they ran the program very professionally. Even now as they are selling off the collection its being handled strictly by the terms and conditions spelled out. I haven't even seen too many complaints among share holders at this point though no actual votes have been made yet.

As for holding the cards in hand - to me its over rated - guess that seems silly but for the kind of cards that were brought into the cardtarget community they'd likely go into my safe anyway and I'd rarely look at them. I own only a few cards that exceed $2k in value anyway and none that are $10k and up so having a share of them was intriging and fun to me.

One thing I should note - I would not be here and would not be into vintage cards had they not started the program at CT. I never looked twice at a broadleaf back before, or a T206, or a 1941 Play Ball. None of them mattered ot me - but I like them now.

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Posted By: MVSNYC

"As for holding the cards in hand - to me its over rated - guess that seems silly but for the kind of cards that were brought into the cardtarget community they'd likely go into my safe anyway and I'd rarely look at them. I own only a few cards that exceed $2k in value anyway and none that are $10k and up so having a share of them was intriging and fun to me."


Jim-

i have owned many valuable cards, and even tho they were kept in a safe most of the time, i took them out and held them every chance i got...

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Posted By: Jim Dale

that would mean I have to remember the combination
...j/k

I guess maybe if I owned a $10k card I might do that more often too. Don't get me wrong I have some great art on the walls but the cards I have just seem to stay in the safe and I'm glad to have them.

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Posted By: Steve

I thought it was a decent idea. many folks can't own 10k cards and this was a way
for them to be able too. If the community makes money when all is said and done then they did good.


Steve

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Posted By: barrysloate

I don't understand the concept of owning a card that you do not have in your possession. In that case it is solely an investment. Nothing wrong with that, as vintage cards have paid nice dividends over the years, but I couldn't really call it collecting.

If somebody offered me a 2% share in a Honus Wagner I might do it because I believe the card will increase in value, but it would be hard for me to have any pride in owning a tiny piece of a card that I will never see.

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Posted By: Jim Dale

Barry it might help to realize the foundation behind cardtarget.com was modern cards from Topps (etopps). Though etopps cards were real they were held by topps for the owners and traded online. 99% of those who were at cardtarget.com when they introduced partial shares were ther for etopps. So the concept of not holding a real card was not that odd to that clientele. Obviously to the collectors here it was odd - too say the least.

One of the things I disagreed with the community of buyers and traders there was our position in the PSA registry for the top 200 card set. We were moving up that list pretty nice, and it seemed to be a focus for a while. I owned shares in every card on that list held by cardtarget, but they were not the best investments. Those who were there for profit didn't care for that direction and the community \ program could not be all things to all people. There simply were not enough collectors willing to own "shares" rather then cards.

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Posted By: barrysloate

Jim- was it hard getting a large community of people to agree on what to buy, what to sell, etc.? It seems like you will always have someone who disagrees with something.

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Posted By: Jim Dale

First it was hard finding cards to bring to the community. Second the owners would contact people to see what their interest was before bidding on cards or trying to buy them. I'm not sure but I think one person who tried to sell a card here on brought their card to the community and shares were sold to pay them? I think that was one of the hi grade T206 cards but I'm not certain.

No one had to buy shares. Someone bought a Wayne Gresky signed jersey and brought it too the community - it sold out of shares and proceeded to decline a little in value. I wasn't interested in that one so I only bought a few shares. Some people bought heavier (me included) on cards that were part of the PSA Top 200 registry, and others only bought when they thought the offer was of great value.

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Posted By: Wesley

The entire project seemed like a good deal for Mike or whomever held on to the cards. Even though it was temporary, he was able to enjoy the cards until they were sold recently. I would love for a group of collectors to pool their resources together so that I can select cards that I enjoyed and hang on to them for indefinite length of time.

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Posted By: Steve

People who bought into this did so as an investment.

Steve

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Posted By: Jason

Just looking back for the first time for those looking at the investment aspect of it, it appears as though 23 cards left the marketplace before the market was closed. With the exception of one card (a Brooks Robinson PSA 9 RC), all were sold at breakeven or a profit. Not a bad track record.

It will be interesting to see where the bids shake out on their current voting/bid process (I believe one card goes up for vote tomorrow night to be sold. An SGC 96 T206 Iron Man McGinnity).

Regardless, it was fun, and I thank Mike from cardtarget (who many of you on the Net54 board have had dealings with) for all the hard work. Maybe it's something that can be revisted in the future.

regards,
Jason

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Posted By: Mike Masinick

Hey guys, just saw this thread.

First off I want to clear up some misconceptions. It's NOT all about money... it never was. Of course it's somewhat about money, but what isn't in this hobby?

Ask anyone who got involved in the marketplace if they know more about the history of card collecting and the history of sports than they did before and I guarantee they will say yes. So saying that "people who bought only did so as an investment" is completely false. They did it to be part of a community... and they did it to enjoy the COMMUNITY process of buying high end cards. Cards they they could only look at before they now were able to have input in pricing and the other aspects of buying and selling.

I am about 150 cards into my T206 set now... a set that I never would have started if it weren't for this marketplace and the interest I found in the T206 rare backs. And there are countless others who have begun collecting pre-war cards after being introduced to them by the Partial Shares Program. We had over 600 individuals buy a share at some point in the program.

That said, from a business standpoint there were simply too much risk and for little potential reward. I'm sure all of you who regularly buy and sell high end $5000+ cards can attest that not every transaction goes well, and CardTarget was taking virtually all of the risk to pass any eventual rewards on to our shareholders. It's just not a practical way to do business and it was the main thing that we had not anticipated when opening the marketplace.

I truly believe in my heart that it was not "all about money", and I'm sorry that some of you can't see past your own collecting prejudices to believe that others CAN get enjoyment from owning a little bit of a nice card without seeing it in their house or safe deposit box.

Anyway, I appreciate all the help that the net54 community has given us over the years. In the short term CardTarget.com is going to be re-focusing on our eTopps program to enhance our eTopps marketplace, but I guarantee you'll see us in the "cardboard" arena again in the next few years with some offerings that should certainly appeal to more of you.

Any cards that haven't been sold in the next week will be put up for auction. Most of the lower value cards and cards with fairly set price ranges will likely hit eBay while the rarer and more expensive cards will be consigned to a major auction house. This will likely be a consignment of 15-20 cards worth $80-$100k. Please contact me if your auction house is interested in taking this consignment. Thanks!

I hope to see you guys at the National... Thanks guys,

Mike Masinick
mike@CardTarget.com

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Posted By: Anonymous

Hey everyone...

I was member of CardTarget for a couple months and I did it as a way to slowly buy the card I wanted...I was able to purchase a 1933 Goudey Mel Ott PSA 8 (prob 8.5) for about 2200 over a span of 4 months..I would buy out people's shares giving them the price they wanted while only spending a couple extra bucks a week to do this. For me it was more of acquiring than investing, I am glad I was able to do this as it would have been hard to pony up a couple thousand at one time to buy a card...for some reason everytime I had cashed saved up another beauty would pop up on eBay to take my money...

Anyways I'm sad to see cardtarget go as I was building up the shares for a T206 PSA 9 Nap .... hopefully another investment/payment plan site like this comes up in the future.

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Posted By: Bobby Binder

I never knew or understood the concept so you are saying if you owned all the shares on a card you had the option of taking it? Then that is a different story if you ask me. If that is the case then some people could just buy a couple of shares of every new card listed and wait for a person that wants it to hold them ransom for your shares. Kind of like the dotcom name game..

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Posted By: Jason

I suppose technically someone could "squat" with a few shares, but I don't think that ever happened.

It was a friendly community, and most welcomed someone buying out the shares and taking it private so to speak.

Regardless, there were T&C in place so that you couldn't be held hostage by someone if you somehow got ahold of 99% of a card. so say you had 99 shares (out of 100) at $10/share, and someone held the last share, they couldn't hijack you and ask for something stupid like $100 for it. There was a 25% rule to where you could immediately buy out a card for 25% over the market value of the last 20 sales average with no vote required. So in this case, you could take out that last guy for $12.50 and be done with it, and then the card is all yours.

The 25% rule is still in effect, and already a handful of cards have been purchased since the market closed. The remainder are of course up for bidding now, to be voted on, and perhaps eventually to ebay or an auction house.

regards,
Jason

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Posted By: B O'Brien

I am one of the folks that learned a lot about the high end vintage cards from Cardtarget, and also got pulled me back to the vintage side of the game. I have owned some nice stuff over the years, but was never able to hold on to it for more than a couple weeks because of limited funds and the need for a return (to keep the wife from getting fired up). Cardtarget was giving some of us the chance to stockpile a percentage of ownership, through share selling and buying, of some really nice stuff over periods of time, with the hopes of pulling enough shares together to remove the card from Cardtarget's collection and into our own, in a slow and cost effective way. Anyway, this was a very interesting concept, that had me buying and selling many times more stuff than I have over the past many years, to move more money to the market. Also, as an investor note, the Cardtarget was out performing my stocks for the last couple months, so I am very happy! It's a shame that the good things the market was doing are just now coming to light, Mike and team may have been able to keep it afloat, with a little more interest.

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Posted By: Jim Dale

In reference to a few comments above; it was kind of fun from the collecting stand point I use to try and get enough shares of a card to help it stay in the community - then I'd find out someone paid 125% of the current share value which enabled them to own the card outright and bang it was gone. Off to try again.

To me it was an impressive collection I could hever had had a part of. For a full listing of what is there and what was there check it out:

http://www.cardtarget.com/cgi-bin/ct_checklist.cgi

On the top is the list of cards being sold now that are still part of the community and on the bottom are those already sold off over the few years this was active.

Heck of a list!