Wednesday Special Feature | Professional Representation 3 Months Into NIL

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Wednesday Special Feature | Professional Representation 3 Months Into NIL

By: Ian Daniels (@IanDanls)

It’s been a bit over 3 months since the NCAA Interim Name, Image, & Likeness policy allowing student-athletes to monetize themselves took effect. As the infantile NIL landscape matures, some notable industry players are limiting their involvement.

Whether it’s fear of growing pains or patience to adopt a more calculated approach, some sports agency giants seem content, for now, to sit on the sidelines at the advent of student athlete earning potential. With another growth spurt on the horizon as the NCAA Men’s and Women’s Basketball seasons begin, we can expect to see even more changes and, with it, more uncertainty.

Agency powerhouses like CAA, Octagon, and WME have been slow to bring on the numbers other agencies have committed to for NIL representation. Despite some recent signings, they have yet to match the intensity of their smaller industry counterparts.

Newly expanding agencies like Loyalty Above All (LAA) and VaynerSports have shown an aggressive approach to rostering college athletes for NIL representation. But this shouldn’t come as a surprise.

While agencies like LAA and VaynerSports represent marquee athletes, taking risks in order to expand feels like a no-brainer for younger agencies. These groups will look to use NIL to supplement their expansion plans with the ability to build relationships with potential professional clients early on.

But if there’s growth to be had, why is their stiffest competition taking their time?

CAA already represents Alabama quarterback Bryce Young and Duke basketball freshmen Paolo Banchero and AJ Griffin, but their NIL efforts have not gone much further. Similarly, WME represents the most followed college athlete on social media, LSU Gymnast Olivia Dunne, but few others as of now.

The calculus for these examples is easy. Social media following is the variable most directly linked to earning potential for NIL deals. It follows that larger agencies would seek out higher profile student athletes to recruit first. These groups are likely sticking to what could be considered a “sure thing” rather than exposing themselves to risk given the pedigree of student athletes they’ve signed so far.

Still, both ends of the agency spectrum are looking to maximize their own perception of value in NIL. “Value” can be broken down in a few ways.

The most apparent value-add of NIL representation is that they’re exclusively marketing deals. This warrants a larger percentage of the payout going to the representation compared to professional Standard Player Contracts (SPCs).

More nuanced is the opportunity to recruit.

Meeting an athlete early on in their career to help guide them through their journey has the extremely high upside of earning trust. An established trust between player and representative can lead to an agreement at the professional level. That reward, however, comes with the risk of losing trust due to distorted expectations or failure to maximize potential on the agent’s part.

For the agencies looking to rapidly expand, the risk is a worthwhile venture with a healthy opportunity for growth on the other side. Larger agencies may see early relationship building as a plus, but they are also confident in their ability to recruit established professional players once their careers are more solidified.

Agencies make little to no money on most of their clients’ professional contracts until the second one is signed, so it comes as no surprise this would be weighted so heavily.

The competitive landscape of NIL must also be a consideration. Unlike professional sports, student athlete NIL representation has a larger variation of entities involved.

We’re seeing entire college sports teams working with local businesses through Group Licensing Programs. These deals are often driven by large marketing firms like Brandr working directly with athletic departments. Michigan State and North Carolina are just a few of many examples of schools who’ve seen the value in connecting their players to marketing representation as a team.

Most high-profile athletes allow their agencies to act as full-service entities, representing them for both marketing and professional contracts; the latter requiring certification by each sport’s respective Players Association. Marketing firms now have ease of entry into NIL as the only representation a student athlete may need.

Apps like Opendorse have put the power in the student athlete’s hands to connect themselves to brands of interest. A stark difference from the heavy reliance on agents in professional sports, these apps allow student athletes to cut out the middleman in some respects.

The novelty of state-by-state regulation creates some uncertainty as well as laws continue to be enacted, with some yet to be passed.

The realm of NIL representation continues to hold unknowns. What we do know, for now, is that the only constant will be change. Agencies must make a careful decision on how they want to proceed.

Agencies looking for advancement in their respective spaces are taking the risks to do so through this newly available frontier. They will likely make their stamp by aggressively pursuing potential professionals through a large player pool.

Other, larger agencies are looking to get the most out of high-upside NIL clients. It’s understandable that they recruit those with the largest potential while touting their major brand connections to retain talent. The ability to recruit later in an athlete’s career helps insulate their more deliberate approach.

This is not to say every major agency has embraced this attitude. Steinberg and Rosenhaus have jumped into NIL feet first, signing numerous players at the outset of NIL’s availability. Excel and Roc Nation have also recently begun to sign more student athletes as the basketball season approaches. The overall trend for larger entities will continue to be sporadic as NIL develops.

As college basketball season rapidly approaches, even more changes can be expected. The more immediate marketability of basketball players, especially with the spotlight of the NCAA Tournament, could create a ripple effect of agencies changing their NIL methodologies as more lucrative opportunities arise.

NIL has a long way to go before coming of age as an industry. For the time being, the only thing that can be expected is change. State laws newly taking effect, possible federal regulation, and a steady stream of those looking to get involved will make sure of that.


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