NIL Collectives - What are they, and how might they impact High School Athletics?



Earlier this week a “NIL Collective” engaged in an apparent landmark deal when it entered into a contract with a 2023 recruit (that’s a current high school junior), for an estimated 8 million dollars, with an immediate $350,000 signing payment.


https://www.usatoday.com/story/sports/ncaaf/2022/03/12/five-star-recruit-signs-8-million-nil-deal-largest/7014601001/


This marks a shift toward what many people in the NIL space were nervous about --->

the unknown impact on recruiting.


Originally the supportive NIL discussion centered around helping student-athletes at the collegiate level gain value and profit on what they were worth, but now as it starts to garner a hold on the recruiting scene - who knows what the future holds?


To be honest, there’s way too much to unpack regarding this deal, as well as NIL Collectives in general in a single article, so I’m going to do my best at keeping this short and sweet, and with an ultimate focus on what the implications may be for the high school space.


So first things first…


What is a NIL Collective?

Kristi Dosh, founder of the Business of College Sports defines them in simple terms,


“...the basic premise of most (collectives) is that an alum, or group of alums, band together to form a company whose goal is to provide NIL opportunities to student athletes of that institution. How they find or provide those opportunities is where the models really differ.”

https://businessofcollegesports.com/tracker-university-specific-nil-collectives/#:~:text=The%20models%20vary%20somewhat%2C%20but,student%20athletes%20of%20that%20institution.


Many of these collectives offer direct access to athletes for fans willing to pay for it. This may look different for each group, but it might be for individualized experiences, autograph signings, or even larger meet-and-greet type activities.


Think of it as an external booster club that is created and run by supporters who want to provide “resources” to student-athletes in new ways, and have taken financial investment in the growth of their athletic programs to a whole new level.


You may have heard of a few recently, as they usually have a branded name such as the - “Friends of Spike” (Gonzaga), or “Horns with Heart” (Univ. of Texas Football Support Group which pays their football lineman $50,000 per year to engage with certain community outreach programs).



As cbssports.com reported,


Collectives have emerged as NIL brokers of varying levels of sophistication. They can be part of a larger company as a for-profit or Non-Profit entity. In the vast majority of cases, there can be no relationship with a school. Collectives must remain a third party in the process”.

https://www.cbssports.com/college-football/news/inside-the-world-of-collectives-using-name-image-and-likeness-to-pay-college-athletes-influence-programs/


Financial support from alumni / donors is not a new thing, let’s be clear on that. Pockets have always been deep, and needs have been supported. But, it usually comes in the form of donations / gifts to the program as a whole through the institution’s athletic fundraising arm.


It wasn’t until NIL when the opportunity was presented to directly provide those funds to the athlete individually. And now these collectives are taking it to another level, sometimes with a full staff working on behalf of these student-athletes.


Many major, Power 5 institutions have some type of collective already in place, and if not, there’s probably a guarantee they’re in the works as a few seem to pop up weekly.


But, if you’re interested in digging in to specific ones furthers and learning more, you can track many of them here —> https://businessofcollegesports.com/tracker-university-specific-nil-collectives/#list-of-nil-collectives-by-school


Now - onto the next step…the impact on HS Athletics.

Some people may not even consider what this looks like at the high school level, but since most of this is quickly pushing into that space, there’s no reason why you won’t potentially start seeing collectives there as well.


Structurally it may just look a little different.


Since most amateurism rules that are being changed to allow NIL at the state governance level are often very hands off, it honestly allows some more impact through a collective focus.


Imagine - a group of local business people put money together to sponsor high school student athletes who align with their business goals, (or who they want to support in an individual, monetary way).


Now - worst case scenario - schools that provide this can utilize it as a “recruiting” tool. And I may take some heat for the next part…


But if we’re being honest, once open enrollment began a long time ago (especially in Ohio), every school began having to recruit their student body, every day. I don’t want that to sound bad, but school choice is a very real thing.


People often aren’t as deeply rooted to the community based school that they grew up in. Their child may need something different, and another school may offer something that their home district does not.


For example - in my own personal case, we’re building a house in a district where I’m closer in travel proximity to two other school districts which both offer different & unique settings / programs. Doesn't mean we'll open enroll our kids to those schools, but, it would be extremely easy to do so if that's what we wanted.


This school “recruiting” doesn’t mean you’re recruiting athletes, but, when you have things to offer that families want, there is a natural gravitation toward that.


Upgraded facilities, high level academics, successful sports programs, etc.


It happens every day.


I’m not saying it’s right, but because of this and NIL opportunities that the high school level, collectives are just an additional “support” that many supporters within a district might have a desire in developing.


Maybe this won’t be the case, but, as it was said in numerous articles - once the train starts rolling down the tracks, it’s hard to slow it down…


So while NIL collectives specifically at the High School level may not be a “thing” yet, at some point they will be, and they’ll support student-athletes, and publicize the “support” they provide. If it recruits students to their schools, that’ll be something to watch out for.


So you might be asking yourself -


What are some of the potential issues for High School Athletic Departments that NIL Collectives might cause?

There are so many swirling around my head that it’s hard to even start writing them, but, a few continue to bubble to the top:


1 - Limited Non Profit Fundraising Funds:

Anyone who has been an AD, a coach, or associated with a high school athletics program, you know there is often a concern about costs. Most athletic programs at the high school level don’t cover their costs, and we’ve all been part of the booster drives, gear sales, and even peddling candles to try to grab a buck for the program.


There will always be a limited amount of funds for non profit fundraising. If the money is now being pooled and directed to student-athletes individually, what happens to the athletic department and booster club that relied on those donations / funds to impact the entire athletic department programs.


2 - “Recruitment”:

Will NIL collectives create a larger division between the haves vs. the have nots, and truly start to create a “recruitment culture” of high school student athletes?


They’ve got the facilities, the coaches, the success - and now student-athletes from their school are making money? Eeeek….


And, while many are probably thinking it, will NIL Collectives have the capacity to create specific “scholarship programs” to cover tuition for student-athletes to head to private schools?


Will they become a breeding ground for the top, elite athletes to play for pay in some capacity? (external the school of course).


3 - Protection of our Student-Athletes

Most NIL regulations make it clear that a school is not allowed to be a part of any NIL contracts, etc, but, as in the case of the proposed Ohio High School Athletic Association referendum, “the school shall not advise the student-athlete against entering into the contract unless any of the stipulations (a-e) are violated.”


So the OHSAA is recommending that Ohio High Schools designate a compliance officer who NIL deals will be reported to, but the extent of that reporting is up to the member schools. Then, that person must be versed enough to understand whether the kid is about to make a major decision that ultimately impacts their eligibility.


That’s a pretty heavy load for school personnel to carry. Not because they can’t, but, you’re asking that this person be versed in NIL, in legalese, in contracts, etc.


Not every student has support externally to help them with all of this. Someone that is willing to ensure they aren’t going to be taken advantage of. Someone who will help them understand how this deal may impact their taxes, their college financial aid, their life in general.


And while I always try to stay neutral in this conversation, that’s a lot to ask of high school athletic administrators, and school district personnel.


I’m not sure there are any high schools prepared to handle what this might look like at their level.


But, as we’ve seen with almost everything else NIL…. it’s most likely coming to the HS space, and undoubtedly, coming faster than anyone thinks.


Here to help in any way I can.


Doc G



 

Dr. Scott Grant, or “Doc G” as his students call him, is former high school teacher, coach, and athletic director turned college professor in educational leadership / social media / branding, and founded Triple Threat Leadership, LLC. (www.triplethreatleadership.com) & NIL-Education (www.nil-education.com). Need resources for Personal Brand Education - check out Dr. Grant's "Branding of ME" course, utilized by over 10,000 students, and integrated into hundreds of school curriculums across the country. Learn more ---> https://www.triplethreatleadership.com/branding-of-me-course If you’re interested in staying up to date about all things NIL-Education, head on over to www.NIL-Education.com and subscribe, as well as follow @NIL_Education on the platforms below by a quick click! Twitter | Instagram | Facebook | LinkedIn