NIL Q&A: Why disclosures and financial literacy are so important
During the first nine-plus months of the NIL era, the space has been inundated by companies pledging to assist various stakeholders – student-athletes, brands, universities, donor-led collectives.
Among those that quickly gained traction is NIL marketplace MOGL, founded by athletes to help connect student-athletes with brands and businesses. It works with more than 800 brands and has more than 2,000 athletes active on its platform. Last month, MOGL earned top honors in the prestigious SXSW Pitch Event in Austin, Texas, winning the Social & Culture category. Some 6,000 startups entered the competition.
On3 caught up with Ayden Syal, MOGL’s co-founder and CEO, to talk about the rapid growth of his company and what differentiates it in a congested marketplace. Syal also discussed the critical need for financial literacy for student-athletes and why brands will be more thoughtful in their NIL investment decisions this summer. This is Part 1 of the Q&A; part 2 will be posted Friday and will touch on the “dirty landscape” portion of the NIL space and what could serve as the tipping point to eventually rein in over-the-top actions of some school-specific collectives.
The interview has been lightly edited for clarity and context.
Q: How does MOGL benefit student-athletes? And how is your company different than others in this crowded space?
SYAL: At its core, MOGL is a platform that connects businesses and brands to collegiate athletes in a safe, secure and compliant way. MOGL was founded on the pillar that the majority of athletes do not have the time, the network, the resources and the experience in building their brands and getting paid. The thing that really differentiates our approach and our value in the NIL space is that because we were founded for the empowerment, support and benefit of the athletes in this landscape, instead of as a solution solely for the benefit of universities, we’re able to provide opportunities for athletes everywhere. We were founded for athletes by athletes.
My co-founder [Brandon Wimbush] played quarterback at Notre Dame and the University of Central Florida, and really gives us a unique ability to empathize with that collegiate athlete experience, a unique ability to connect to them in a way that no other player in the space can. We didn’t want to limit an athlete’s ability to monetize their NIL based on whether or not their school had a partnership with us. As a result, we automatically disclose all of the activity on the platform, ensuring full compliance with university compliance. And we’re removing any friction in the disclosure for athletes. Obviously, it’s completely free for them to join. Unlike some other players in the space, we don’t take any single percentage of their deal. But most importantly, we’re automatically disclosing the activity. And we’re providing opportunities for all athletes. So universities absolutely love us because our solution discloses 100 percent of the deals on it.
Q: Providing educational resources is a key component as well, correct?
SYAL: That commitment to educating, supporting and informing athletes is something that we’re really focused on. It’s not something that is just something that we’re saying now to be able to communicate to athletes. We have an internal director of compliance who joined us from Stanford’s compliance office and the NCAA. Through strategic partnerships with major corporations, we provide free resources available for athletes and their families as they navigate the NIL landscape. Those resources include financial literacy, tax, contract review, brand-building, content creation and merchandising, NFTs.
MOGL recently became the only NIL marketplace with its own NFT [non-fungible token] marketplace. That’ll give us the ability to offer all of our athletes the ability to create and sell their NFTs and continue to build their brands with fans. And we’re also the only NIL company that has the ability to give every single athlete on the platform the ability to set their own merchandise store, design apparel, and sell it through a partnership as well.
Q: I keep hearing that the disclosure of deals is a big issue, that as few as 10 to 15 percent of NIL deals are actually being disclosed. How big of an issue is this, and are those figures along the lines of what you are hearing?
SYAL: That’s basically what I’ve heard as well. The thing is, inherently it’s a big issue because any deal that isn’t disclosed puts an athlete at risk, both from an eligibility perspective and also from a perspective of they could be taken advantage of or do something that conflicts with university protocols. That is in the long run. But unfortunately without repercussions or other guidelines in place, athletes are not going to be incentivized to disclose, and universities will continue to not mandate disclosures in many cases.
It is a big issue in the long term because by not disclosing, athletes are currently running the risk of getting in trouble or also putting themselves in a position that will limit their NIL activity going forward. But right now, because there’s no mandate in place, no repercussions for the lack of disclosures, universities are barely even reviewing any disclosures.
Q: You touched on financial literacy. I’ve been told, even almost 10 months into the NIL era, there remains a huge gap in NIL education among athletes. How critical is it to bridge that education gap?
SYAL: Simply put, there’s a huge gap. The major gap is that you could give athletes all of the financial literacy resources under the sun. But it’s the same thing as that saying – you can only bring a horse to water, you can’t make it drink. That’s where the major gap is. Because at the end of the day, if you’re just giving the same financial literacy curriculum, or lectures, or materials that you’d find in a textbook, or even a normal Financial Literacy 101 course, that’s not going to work. It is not going to resonate with athletes; they are not going to be inclined to ask questions about it. And as a result, you’re not really going to be providing any value.
On our end, the first partnership we ever signed, it was like, probably four months before July 1, we signed a partnership with Money Vehicle, which is owned by Jedidiah Collins. He is a 10-year NFL veteran who played fullback at Washington State and is now a certified financial planner. He has built a curriculum that’s really designed to be engaging for athletes and put things in their terms. So as a result, every athlete and their family get direct access to the course upon signing up for MOGL. We’re really excited to be able to give that course completely for free to all of our athletes. The course itself, we thought it was great. We think that it really can be super powerful for these athletes. It’s, again, the horse-to-water thing. So we’re trying to figure out how to do it better as well.
Many state laws have four hours of mandated financial literacy put in place: “If you want to monetize your NIL, you need to do this course.” Who knows if schools are really even doing it, and if they are, it’s probably just, “Hey, sit there for half an hour and watch this thing while you’re on your phone.” That is not beneficial to anyone. We have a strong relationship with Baker Tilly. We just hosted a webinar with them about tax implications and how to file your taxes as part of NIL. Other resources are going to be made available on [the platform]. Shortly we are going to be formalizing partnerships with some really large corporations, as well, in the space that we’re excited about, but can’t reveal that yet. But I think it’s probably the biggest issue of all right now because it’s the issue that’s going to be the most long-term damaging for athletes.
Q: Tell me about your system to measure ROI for influencer campaigns.
SYAL: Every brand on the mobile platform is given the ability to receive insights into audience demographics – expected reach, ROI and other KPIs [key performance indicators] that they’re most concerned about for their campaign. If it’s an e-commerce boutique and they’re selling shoes, they’re probably going to be most concerned about conversions. How many sales did this generate? Whereas if it’s a new podcast or something, they’re probably most concerned about the reach of downloads.
We work with each business as they join the platform to understand what their marketing goals are and why they want to use a service like this. And then through a proprietary system, we can actually provide both expected campaign results and analytics in real time to brands as their campaign progresses. This is extremely important for brands. There are components to NIL where athletes are being disserviced. There are a lot of ways that brands are being disserviced right now as well. Like, they’re using other marketplaces that don’t have these capabilities. And I’m not, by any means, speaking ill of the competition, but these are things that brands should expect in their campaigns. You need to know if you’re spending 100 grand, what’s that 100 grand getting you? We can also identify or track in real time all of the value that their campaigns are driving.
Q: How many athletes, how many brands are you working with now?
SYAL: We’ve got 2,000 athletes on the platform that are actively logged in, have updated their profile, you know, really engaged on the platform. We’ve got something like thousands of signups. But at the end of the day, when we think about who our athletes are, we think about the ones who are actively logging in. And that’s about 2,000 right now. We work with over 800 brands, some of whom are local boutiques, burger joints, pizza shops, things like that. But then also we have exclusive NIL partnerships with a number of really large national brands. … So some of the larger brands on the platform are Allbirds, TicketSmarter, discovery+. We’ve got Scotch Porter; we just did a really great campaign with them with some major football guys throughout the country. And then we’ve got tons more coming every day. We’re excited.