False Deals + Fake Promises = Athletes Get Hurt

Although athletes are the most important piece to the puzzle in sports…

They can often be the last thought.

Leagues, governing bodies, universities, teams, and owners make sure to get theirs first (and then athletes/employees enter the mix).

And when fast money enters sports — as it did with NIL and crypto — athletes sometimes get hurt by it.

Before spouting off too far, I want to cover some recent developments that are important.

Let’s Dive In 👇

BYU and its NIL Payments Controversy

Last year, BYU football and nutrition brand Built put together what I still believe is the most innovative NIL deal to date.

Here were some of the details:

• Built paid tuition for all walk-ons

• Built provided every scholarship player with $1,000 each

• BYU players had to show up to events and promote Built Bar on social media

Everything was great (until it wasn’t)…

Built decided to sell a BYU-specific ‘CougarTail’ bar and 15% of the profits would allegedly go directly to athletes who signed a NIL contract with them.

I think you know where this is headed…

Tuition has been paid for walk-ons and scholarship players got their $1,000 — but the 15% of profits are nowhere to be found according to the players.

Oops.

Failed NIL Collective Payments

If you think a few thousand dollars is bad from Built Bar…

Then you haven’t heard some of the horror stories out of the NIL collective world.

• We’re talking about college athletes who were promised $500k and were lucky to come away with 20% of that.

• We’re talking about collectives who paid athletes $1M to stay at the University and the players took the money + dipped off to new schools where they got paid just as much.

I agree with Nick Saban when he says NIL should be handled more like the professional leagues…

But it doesn’t take a rocket scientist to know what that would mean for college sports.

NFLPA Burned By Crypto

The NFL Players Association reportedly has been unable to collect nearly $42 million in revenue from OneTeam Partners.

The worst part…

That could mean a loss of ~$20,000 per active NFL player.

Putting that in perspective — that’s a 10% revenue loss for a practice squad player.

How did this happen?

The revenue is likely tied to Dapper Labs NFTs (which are digital highlights or trading cards).

Dapper asked the NFL and NBA to renegotiate their deals a few months ago after cryptocurrencies collapsed.

Oops, x2.

Athlete Investors

Crypto’s collapse hurt athletes collectively (and teams who had sponsorship deals).

But high-profile individual athletes got hurt even worst…

Tom Brady, Steph Curry, and Shaquille O'Neal were put under investigation after promoting the cryptocurrency trading platform FTX.

You may remember that their founder, Sam Bankman-Fried, was arrested and charged with wire fraud, securities fraud, and money laundering after FTX filed for bankruptcy.

Oops, x3.

Going Forward

When individual athletes make bad decisions — it’s easy to single them out.

But the same thing is happening with well-respected institutions (and the problem is that the players are the ones getting hurt at the end of the day from it)

• BYU not holding Built to their contract is bad

• NFLPA’s defunct crypto deal losing each player $20k is bad

Fast money always looks to sports…

The thing with fast money is that it’s not always guaranteed.

It will be interesting to see how these NIL + crypto developments play out.

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Podcast 🎙

Today’s guest is Hugo Inglis — a 3x Olympian and the founding partner of High Impact Athletes.

High Impact Athletes (HIA) connects world-class athletes with world-class charities, where every dollar given can do the best possible.

You’ll enjoy this episode as we discuss:

• Bad vs. Average vs. Good Charities

• What it’s like competing in the Olympics

• Rise of athlete communities (venture + philanthropy)

Check out the podcast episode here.

Hugo has an interesting background that intertwines competing at a high level athletically with doing good for the world.

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Thanks for tuning in today!

Have an awesome weekend.

Peace,

AP

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Sources:

https://www.outkick.com/byu-football-nil-name-image-likeness-built-bar-false-promises-deals-contracts/

https://cryptoslate.com/nfl-players-union-unable-to-collect-41-8m-in-nft-related-revenue/