Great idea, although the article highlights the biggest problem: adverse selection. Students who want to slack off will choose equity, whereas go-getters will choose debt. Given this, no provider of equity could be sure that they would be getting high-quality income streams, so they would charge more, worsening the effect, etc. etc. I doubt that all the analytics in the world could counteract this effect.

To get this off the ground, you'd need some sort of coordination, either at the school or government level, to enforce risk pooling. How about free education at state colleges coupled with a higher lifetime marginal income tax?