The 3 NIL Collectives Transforming College Sports and Why The NCAA Might Ban One of Them
NIL is bringing about major questions on "amateur" athletes getting paid and what was going on at universities pre-NIL.
It’s no secret that for years college athletes got paid under the table (literally and figuratively).
But thanks to NIL, college athletes are now able to make money off of their name, image, and likeness - which is like signing endorsement deals.
But there’s a catch.
Technically the pay-to-play model is still outlawed by the NCAA.
So college athletes can sign brand deals where they provide something in return (social media post, appearance, autograph, etc), but they cannot be paid a conventional salary or have a contract laid out before arriving at the school.
And then NIL collectives came around and blurred this entire model.
The Three Types of NIL Collectives
I have labeled them myself as there’s no official title (at least not yet).
1. Matchmaker NIL Collectives
These collectives help facilitate deals between athletes and businesses.
“Matchmakers” are acting as marketplaces, or even agents in some instances, helping connect the athletes and businesses wanting to do NIL deals.
2. Donor NIL Collectives
This type of collective is pooling booster/fan/supporter money and using it to do its own NIL deals with athletes.
These collectives are essentially “washing” donor money, allowing it to be paid to a school’s athletes in an NCAA bylaw compliant manner.
3. The Dual Collectives
Some of the NIL collectives are performing both functions: “matchmaker” and “donor”.
The big question with collectives is whether at some point the NCAA is going to attempt to shut down ones that are performing the second function of “donor”.
The only thing stopping collectives from running rampant are the schools themselves.
If they see too much money going to collectives trying to lure the big recruit, rather than seeing booster money being donated to traditional athletic department ventures, they may want to step in.
A Dual Functioning Collective
The Gator Collective was the first ever 3rd party NIL company and is by far the most successful to date.
They have over $500K in committed memberships by Florida Gator fans wanting to help athletes sign deals.
What’s wild, is they signed a sponsorship deal with the University of Florida as well.
I wrote about The Gator Collective in September, long before collectives popped up at every Power 5 school - you’ll see that I predicted most of what has happened and also got a few things wrong.
Where Do Athletes Fit In To This?
Paying college (and even high school) athletes what they’re worth is long overdue.
The problem is that anti-trust laws and Title IX make this very difficult.
NIL has been the beacon of hope for paying amateur athletes legally.
But like anything, the original plan hasn’t stayed completely on track and NIL collectives are largely to thank (or blame) for this.
While not everyone will agree with donors washing money through collectives to guarantee recruits payment upon arrival, the athletes will benefit greatly from this.
In all fairness, schools were throwing money under the table to 5-star athletes to begin with.
Don’t you think it’s a little better to see what athletes are offered monetarily and for them to not get in trouble like Reggie Bush or Terrelle Pryor?
It will be interesting to see what the NCAA rules with NIL collectives, as they are quickly taking over the power 5 landscape.
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Thanks for reading my friend!
Have a great weekend and I’ll see you on Sunday for the weekly roundup (there’s a ton of cool developments from this last week I’ll be going over).