Phil Martelli heard the three letters buzzing around college sports and laughed. Sure, go ahead and ask about NIL, he said
“And the answer to every question is, ‘I don’t know, I don’t know, I don’t know.’”
The veteran basketball coach, currently an assistant with the University of Michigan men’s team, is not alone. The NCAA abruptly deciding college athletes could be compensated for their name, image, and likeness has left players and their families, schools, and third parties scrambling to figure out what’s allowed, what’s not, and the ramifications of it all.
The marketplace
Stacey Gersten remembered a recent conversation with an NCAA board member. “You guys are acting as if these kids are out to make millions,” she recalled telling him. “Everybody thinks there’s all this money. None of these NCAA athletes are going to get LeBron James money.”
The NCAA’s decision, from its creation in 1906 until July 1, to prevent student-athletes from getting paid is certainly ripe for criticism.
As Gersten, the vice president in charge of brand and agency partnerships at Burns Entertainment, asked the NCAA board member before the organization changed its stance on NIL: “Why do you care if these kids are making 500 bucks?”
Gersten was speaking generally. She doesn’t believe in rate cards for her clients, but others in the NIL space shared industry standards. For social media influencers, that could mean between $6 and $10 per 1,000 followers for a sponsored post, according to Patrick Werksma, COO of PlayBooked, a company connecting college athletes to potential endorsement opportunities.
That math checks out for Chloe Mitchell, a college volleyball player and DIY influencer with 2.6 million TikTok followers. She regularly brings in five figures for a sponsored post.
Jim Cavale — CEO of INFLCR, another company in the NIL space — assessed the social media profile of University Michigan men’s basketball player Adrien Nuñez and calculated more than $1 million in earnings potential over the course of a year.
Cavale said that while many athletes gain large followings simply for being good at their sport, “the best student-athlete NIL stories” will be those involving unique content that goes beyond the playing field. It’s worth noting that Nuñez, who is entering his senior year, has averaged just 4.6 minutes per game during his three seasons at Michigan.
There are of course income streams outside of social media, even if everything is eventually promoted online. Examples include selling merchandise, as Nuñez and his teammate Eli Brooks are doing, hosting a camp, speaking with young athletes on a video call, and public appearances to promote a company or sign autographs.
Many college athletes are already taking advantage, but not all. Mitchell presented her entire volleyball team with an opportunity to receive $40 for filming a short video promoting a product. Some took her up on it; others weren’t interested.
Barstool Sports, a digital media company, created an opportunity out of thin air. “Barstool Athletes Inc.: I just made that up in my head right there on live stream here,” Barstool’s founder, Dave Portnoy, said in a video introducing the concept on July 1. “If you play Division I sports and you blink at me, we will sign you,” he added.
An application generates an automatic email outlining the next steps for the interested student-athlete: add “Barstool Athlete” to your Instagram/Twitter bio and submit a photo in uniform. The email notes the athlete will receive Barstool merchandise. Several University of Michigan athletes have signed up.
For many, a Twitter shout-out and a free shirt are enough. They represent the majority of college athletes who, according to Gersten, won’t be signing big-time deals.
She estimated perhaps 50 to 100 college athletes at any given time who could earn six figures over the course of their college careers.
Even for those just hoping to pocket some gas money, there are potential pitfalls.
A Wild West of gray area
Among them were
several Michigan football players. The fine print on all those deals
wasn’t exactly athlete-friendly, with multiple industry experts noting Yoke’s “worldwide, perpetual, transferable, sublicenseable, royalty-free and irrevocable right” to use pretty much anything an athlete did while gaming through Yoke.
“These are real contracts,” Gersten said. “They should have a lawyer look at them.”
She noted that if one of the brands she represents wants to work with, say, actor Matthew McConaughey, she has to go through his agent, his manager, his lawyer, and his publicist. A college athlete may not have the means or the need for such a large team. “But they should all have some representation, whether it’s a parent or a friend acting as a manager.”
Jake Teplitzky is the founder of a management group that is providing such services to college athletes. As an undergrad at the University of Miami, he befriended many athletes and saw how they were taken advantage of. His goal is to do right by his clients, which includes not risking their NCAA eligibility.
“There is a lot of gray area with all of this,” he said, echoing the thoughts of several others interviewed for this story.
Teplitzky recently heard about a lawyer who wanted a University of Miami football player to wear a t-shirt bearing his law firm’s name twice a month. The lawyer was a devoted Miami football fan. Teplitzky said he advised the player to stay away.
“Players aren’t worried about boosters right now,” Teplitzky said. “They’re just looking for money. The floodgates have opened and they want to get paid. They don’t think about where the payment is coming from. But that’s what determines eligibility.”
He cited Oklahoma quarterback Spencer Rattler signing with Steinberg Sports as a potential issue given that Steinberg also represents NFL players.
Teplitzky said he’s not trying to be a whistleblower but rather pointing out the landmines in this new arena.
What puzzled and peeved so many for so long is that while college athletes could not be compensated beyond their scholarship, their classmates could. An aspiring actor could get paid for being in a commercial. A music major could sell an album or give piano lessons to local youths. Neither would get their scholarships pulled as a result.
NLI (national letter of intent) signing no longer prevents NIL earning, but has the pendulum swung too far in the other direction?
Third-party NIL companies have struck deals with college athletic departments. This is where individual state and school laws need to be parsed.
The
University of Michigan’s policy states that student-athletes can retain professional advisors but that the school won’t provide nor pay for such services, “except those services available to all students at the institution which student-athletes are eligible to use in the same manner as any other student (e.g, Student Legal Services).”
The NCAA’s stance on schools arranging NIL opportunities for its student-athletes is vague. “A number of factors are relevant,” according to
the NCAA’s policy. One thing is clear: “NIL opportunities may not be used as a recruiting inducement.”
Yet schools are discussing opportunities with high school recruits and college transfers.
The New York Times reported that the Minnesota’s men’s basketball coach told an in-state recruit he could make more money as a hometown hero than if he went out of state and that Texas’ coach “played up the presence of the computer manufacturer Dell and the social media company TikTok in or around Austin.”
An athletic director told MLive that the NCAA’s guidance to schools has essentially been, Figure it out yourselves — but don’t break any rules.
Said Gersten: “It’s very much this Wild West,” yet another phrase used by multiple interviewees.
Even if a deal is legally sound, there is the all-important compliance element.
Consider the hundreds of newly minted Barstool athletes. Aside from Barstool’s history of sexism and racism, the company is partially owned by Penn National Gaming, a casino operator. Barstool Sportsbook is both a mobile app and a physical space in Detroit’s Greektown Casino.
The University of Michigan’s policy includes this paragraph: “Those who have chosen to be a student-athlete have chosen to act as public representatives of the University and may not engage in name, image and likeness activities that may harm the reputation of the institution. This may include but is not limited to: promoting products or services such as gambling, adult entertainment, tobacco, or banned substances.”
Come the fall, as campuses come to life, there will undoubtedly be rumors about athlete deals. Martelli, the assistant basketball coach at Michigan, cautioned against believing them all, like an athlete making five figures for showing up at a car dealership. Likewise, Martelli said that those saying NIL “is completely out of control” are also off base. “No one knows yet,” he said. “I don’t think we have any idea.”
And so when he fielded questions about NIL during recent recruiting trips, he was not afraid to say he didn’t have the answer. He advised players and their families not to rush into any deals so as to avoid mistakes.
Just as these initial NIL deals are receiving coverage, so too will the first athletes or schools to get reprimanded by the NCAA.
Teplitzky, despite all his concerns, is thrilled the NCAA has opened this avenue. “This is bigger than just sports,” he said. “This was a human rights issue.”
College athletes, at last, are free to explore what the market has to offer.
“People are caught up in the money right now,” he said. “The main thing is that the power is going in the hands of the players. It might not happen overnight. But it’s happening.
