Most people will, at some point in life, take out debt: a mortgage, credit cards, payday loans, and more. Businesses have another option: they can sell equity.

Individuals don’t really get this choice. The closest example is young athletes selling a share of their future earnings to access the best coaches.1 But that option is really only available to the highest potential individuals at the beginning of their career.

Having that choice is a big advantage! Access to capital unlocks a lot of value: think education, moving, or starting a business. It doesn’t seem right that the only way for individuals to get it is through debt.

Maybe it doesn’t have to be this way. Introducing: the personal IPO.

Creating personal equity

Imagine Sarah, a marketing manager at a moderately successful tech startup. She wants to raise some money for her masters degree, but it just doesn't make financial sense in a high interest rate environment.

Instead, she logs into the Human Capital Exchange (HCX) and prepares to go public. The first step is to file her disclosures; the standard is a mix of tax returns, diplomas, and an overview of her personal and professional outlook. Next, she decides to split herself into one million shares, selling 250,000 of them at a $0.20 initial bid. She picks her new ticker ($SARAH_SMITH_MA) and gets ready to IPO.

There’s one issue: nobody knows who she is, and nobody wants to buy the shares. Her best bet is to engage a personal investment banker (pIB) to create a roadshow deck, highlighting her growth strategy, competitive positioning, and market edge. In meeting after meeting with individual investors, she can refine her pitch to lean less into her love of learning and more into the size of her 401(k).

There are a lot of benefits if she succeeds at the IPO. Equity lets her trade upside reward for downside protection, de-risking these big financial investments. She can strategically buy and sell shares of herself to smooth out a lifetime of earnings. Strategic investors can amplify her opportunities, introducing her to other individuals in their portfolio. Most of all, it gives her optionality if she chooses to pursue a career path with atypical earning curves.

But for the investors, what does it actually mean to buy equity in someone?

Becoming an investable asset

Like any other type of equity, investors need some rights to give equity ownership meaning.

The simplest option is to offer a dividend based on future earnings, allowing investors to use discounted future cash flows to set a price per share. But it’s not the only way; high potential but directionless people could add on voting rights, contractually agreeing to take actions based on board votes.

You can imagine specific bundles of rights would become standardized, a requirement to make shares investment-grade.

Whatever structure Sarah chooses, the challenge of getting investors would be central to anybody trying to IPO.

Of course, founders that are especially talented at getting attention will always attract eager investors. For everyone else, there’s an uncomfortable truth: most people aren’t particularly investible.

Imagine a Big 4 accountant earning $85,000 per year, with an income growing at 3% annually over their 40 year career. Assuming a 5% discount rate, their total earnings are worth $2.2 million in present value. But if they’re selling common shares, agreeing to pay 5% of their salary as an annual dividend only gives a fair market cap of $114,036.

Even if you assume there’s alpha in inheritances and activist investing, it’s just not investable at scale — especially for institutional investors. Even worse, there’s massive adverse selection among sellers. The temptation to sell shares then quit your job will make it hard for investors to properly vet everyone on the exchange.

Still, there’s enough opportunity that the market will find a way. One path is the development of an equity rating system that categorizes individuals based on factors like education, location, and earnings history. With general quality ratings widely available, investors will at least be able to identify obvious mispricing.

Another route is sourcing strategic investments. An aspiring Goldman Sachs analyst can take an equity investment from the bank, aligning incentives and locking down the full time role after a successful internship. This lets analysts share the cost of burnout with their employer while letting Goldman Sachs monetize the career progression they provide. It’s a good deal, as long as it’s not mandatory; selling a majority stake in yourself to Goldman Sachs seems like indentured servitude with more steps.

A third path is the creation of mutual funds and ETFs that do the hard work of aggregating multiple individuals into bundles. With some work, product managers at big tech, the Princeton class of 2026, and Y Combinator classes all become investable assets.

With bundled instruments, personal markets become the new private markets. Today, the only way to invest in OpenAI is through direct purchases from holders.2 Why buy shares on a private market when you can buy $OPEN_AI_EMPLOYEES and get exposure to their future salaries, bonuses, and (most importantly) equity windfalls?

The consequences of selling yourself

However you get your investors, your world changes after a successful IPO.

Daily share price becomes a critical part of day to day life. Everything you do in public would generate price feedback, telling you immediately whether your decision adds value. If Sarah changes her marketing analytics major to performing arts, she’ll see an immediate crash in her share price.

“I wouldn’t care” you might say. “I’d sell some equity, major in performing arts anyway, and let the price crash.” Well, as Matt Levine likes to say: everything is securities fraud. Any decisions that lower share price, without adequate disclosure, risks triggering a shareholder lawsuit. The SEC will become a household Stasi, going after individuals who miss a dividend payment or are reckless with their investor capital. Sarah is majoring in marketing analytics, whether she likes it or not.

The SEC isn’t the only enforcer; if you sell a controlling share of yourself, you risk attracting the attention of an activist investor. Your mother might aggressively buy in and start reallocating your budget to LSAT prep, part of a hostile takeover to send you to law school. Or worse, imagine you’re a promising Stanford freshman with a startup idea. The Thiel Fellowship isn’t asking anymore; they’re buying a majority stake and making you drop out of college.

More worrisome is the secondary financial markets that would spiral from this. Derivative financial products — CDS’, calls, puts, and futures — all become ways to bet on your personal outcomes. This creates some moral hazard; an unscrupulous employer could short your stock or take out insurance that incentivizes them to lay you off.

The marriage M&A

Of course, people aren’t little corporations — they live, have hobbies, and love. Love is a major financial issue — if you marry someone and merge your finances, it totally disrupts the valuation methodology for your personal shares. So a marriage must become the most romantic thing of all: an M&A transaction.

There’ll need to be extreme due diligence ahead of the wedding. Your partner’s background, job, and income all need to be verified, and checked for synergies. Excess equity value will have to be accounted as goodwill; an extrovert-introvert couple might have to take a loss in a merger. When you bring someone new home, your friends and family are going to look into your new partner’s 10-K to see if they listed “commitment issues” as a future financial risk.

Marriages aren’t just the joining of two people; they’re the joining of two families. For IPO’d individuals, it’s also the joining of two sets of investors. This raises significant concerns if the investors have different investment theses; Sarah’s growth investors didn’t sign up for her to join her husband’s organic chicken farm.

This kind of mismatched marriage risks proxy fights between two sets of investors, who might launch competing bids to takeover the combined entity — a major risk to the nuptials. To avoid this, investors might set up dating pools across their investments, making sure they don’t literally get into bed with their competitors.

Savvy couples will have some tools to fight back. Poison pill provisions in prenups are a key tool to protect against hostile takeovers; if a shareholder forces a divestment, they risk triggering a “midlife crisis” clause that requires the parties to liquidate their 401(k) and start a fusion food truck.

Becoming a going concern

One of the key assumptions in corporate valuation is that the company is a “going concern” — essentially expected to continue indefinitely. There’s a big problem with that: people retire (or worse)! Eventually the cash flows are going to stop, whether by social security ending or the literal corporate death penalty.

The good news is that we have a built-in continuity system: children. Childcare is a major expense that hits your cash flows; this reduction in assets needs to appear somewhere else on your balance sheet. It doesn’t seem quite right to call them a liability — although GAAP classification would be interesting — so it seems logical that children are added to the family corporation as a long-term asset, ensuring the family corporation continues to the next generation.

This raises the stakes of childhood: kindergarten finger paints will be scrutinized by Wall Street analysts pricing family units. It’s great to play music if it’ll help you get into college, but investors will get impatient if you dream of doing it full time.

Turning children into assets creates new ways to finance families. The cost of raising children is generally considered a crisis. But with an IPO’d family, your baby announcement acts as positive forward guidance. Your family’s equity value will go up and new shares can be issued, essentially selling a share of their future earnings to pay for their upbringing.

At its best, you can imagine this being a way to ease the financial burden of parenthood, providing better and more stable upbringings to children. At its worst, savvy PE funds will start running high-end schools that limit admission to families exchanging shares at friendly valuations, like a human version of a PE rollup.

As a child grows up and becomes an adult, some serious questions come up about independence and control. If you’re part of a family corporation, your life is very directly managed by the majority shareholders — unlikely to be you. It could make sense for you to do a leveraged buy-out (LBO) to go independent. Specialized bond underwriters could facilitate these spinoffs, potentially using non-dischargeable debt.

Unfortunately, by spinning off you’ve doomed your parents’ market cap — even if you account for the cash you’ve paid, you’ve removed their age diversification. The only way for them to remain a going concern is through a strategic merger: acquire a young person to extend the earnings timeline.

These mergers will give securities lawyers lots of opportunities to be creative. Want to bundle social security payments into the transaction? Solve the housing crisis by including inheritance rights for the house as part of the merger? Bring Japanese-style adult adoption to the world? Whatever it takes to close these deals will be considered: those that can’t acquire will be acquired. New MBAs will evolve the search fund model, looking to provide succession planning and professional management to distressed family assets.

Official idea rating

4/5. Finance is, at its best, the art of letting people price and make tradeoffs on their future. As existing asset classes continue to get saturated, it makes sense that we might see more radical equity ideas get tried (and maybe fail).3

As a non-securities lawyer, I am pretty confident it is not legal to directly set up this kind of exchange today. But whether or not it’s legal, someone will 100% create a version of this and get lots of press coverage. My guess: a crypto founder selling tokens in themselves.

Either way, if this one takes off you can find me under the ticker $NDI. I’m seeking a strategic buyer who can get me a Bloomberg column.

In case you missed it: try the Personal IPO Calculator from No Dumb Ideas Ventures™

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