NIL collectives ‘just another tool for schools to use in the arms race to keep athletes’
“Collectives” is the hottest buzzword in the NIL space.
Schools can’t create them, but passionate, prominent and wealthy donors sure can. A collective is a NIL-related company that can help facilitate deals for athletes, and also can create its own deals for athletes through funds pooled from alumni and fans. Roughly two dozen have been launched nationwide. By the time you’re finished reading this story, though, that number may have grown. They are popping up that quickly.
On3 caught up with Bobby Bramhall, the president and co-founder of Athlete Licensing Company, to explore how quickly collectives are launching, the potential recruiting inducements they may provide and what could happen if your alma mater doesn’t have one. Bramhall is a former assistant athletic director at Texas A&M.
This is Part 2 of the interview; Part 1 is here. The interview has been lightly edited for clarity and context.
Q: One of the roles of a collective is to help facilitate NIL deals for athletes. I just wrote about how smart Ohio State was to assume this role and do it in-house, with its own staff, because state laws allow it. What was your reaction to that move?
BRAMHALL: I need to look into that deal a little better. My first thought is it seems a little bit in conflict because you did the stadium wars for years, right? Yeah, you got donor money, you know, for the stadium and naming rights on the outside of the buildings. And that was the way to collect money, for ticket sales and selling suites and all that kind of stuff. Now, it’s that we’re facilitating NIL deals in-house. I guess that’s for the recruiting purpose, but how is there not a conflict of interest there, where you’re in-house facilitating NIL deals but you’re trying to say that you’re not involved? I mean, the NCAA has been told to step away by the court system. And so just chatting with you, I don’t know. What do you think about it?
Q: I think others are going to try to copy it. They’ll try to copy it if they have a forward-thinking administration — not all do — and if state laws allow. Those that can do it but choose not to will fall behind. NIL is an arms race and evolving so quickly.
BRAMHALL: No doubt. I think it is another way for them to maybe get in and allow opportunities to come in, maybe screen them and say, “This is a good one. Take it. It’s separate from your ability to play the game for the coach. It’s off the field.” It may not be in conflict with maybe donors giving to the stadiums or the type of money they need to raise for athletic interest otherwise, so it may be good, may be nice to have an in-house group. I know that the University of Arkansas has the student-athlete brand development. And so they have that probably already going in the same manner. It’s probably just not been publicized as much. So I guess that’s going to be necessary.
Q: What’s the market and potential like at the Group of 5 level for collectives?
BRAMHALL: You are going to have to have them. It may be more of a unified front at the Group of 5 level, whereas at Ohio State, they can have a football collective, they’re going to have millions generated in that way. At the Group of 5 level, they may have a university collective that benefits student-athletes in a way that allows them to have community outreach, put on camps and events. Who’s to say you have a school that promotes this and some non-profit organizes a golf tournament where all the people in the community can pay for it, come and support the student-athletes and the student-athletes now have “work.” … They earn money to show up to these golf tournaments because of who they are at the university. That’s a great thing to me. Group of 5 collectives need to get in the game and get it going. …. They have got to get in the game as far as the donor side is concerned. I see it as an opportunity if they have a wealthy donor base somehow at one school. If a school wants to get going, they can start offering these opportunities in the NIL space and maybe make some leaps in competing a little bit.
Q: What’s the biggest question founders of collectives have for you?
BRAMHALL: How do you make our process more efficient and easier? How can you help us? They say, “We don’t have the manpower to put these deals together on our end and then distribute all the payments and keep up, continuing to raise money and make it happen.” And so we can make their lives easier by doing the back side while they’re the front-facing group. That’s our main deal: Let us take over because we kind of understand the process, and we’re able to organize the chaos. I mean, it’s so chaotic that we can help you organize the chaos instead of you feeling like the more money that comes in, the harder your work is going be, the more people you have to hire.
Q: You’ve used that word a lot — “chaos.” Others, when I talk with them, have as well. What is so chaotic about this space?
BRAMHALL: There’s no rules. It’s the wild West. So basically the court said, “You get to be who you want to be as a student-athlete, just as any other individual would at an adult age, and go for it.” And everybody had to kind of let everything happen as long as it wasn’t pay for play. So there’s really no guidelines or rules. And there can’t be rules because the NCAA was told you got to just watch this take place, like you can’t get involved unless they’re actually violating an NCAA bylaw. And so that’s been tough. One more thing I want to say about the collectives needing advice. A lot of the collectives don’t know they can make money. So we’ve produced a model that generates revenue for collectives to participate. So instead of a collective just raising a million bucks, paying players as an expense write-off to businesses, or a golf tournament, or whatever, and getting athletes to use their name, image and likeness to exercise their rights, we are actually able to say, “Hey, we can create merchandise opportunities that go back to the collective and split money with the athlete.” Maybe the student-athlete gets 80 percent and the collective benefits as well. We sell banner ads for our app, so the collective can have an app with us that they are able to generate money with their fan base and say, “Hey, support your favorite student-athletes. Give to our collective, and we take a revenue proceed.” There’s so many opportunities for collectives to have shareholders that use that as an investment opportunity. So they buy a stake in the collective, the collective grows from a million to 50 million in five to 10 years, and they’re going to grow, their pocketbooks are going to grow just being a part of it as a group. So we think their reach is actually more than they realized; we think their reach is going to be huge, all the fans buying merchandise from the collective. The collective gets athletes to sign on; buy merchandise through the collective to support the NIL of the athletes and the collective makes money as well. So it’s that same advancement model that [recording] artists have always done, where people invest in the artists and the artists get a cut and the label gets a cut. Everybody gets to make money.
Q: Thinking it out down the line. The biggest brand-name schools will be affiliated with the most powerful, wealthiest collectives funded by the deepest-pocketed donors. And other schools — really, their donors — will have no choice but to try to keep up.
BRAMHALL: Now it’s another factor. [A school can say] we have a golf tournament, we have a donor collective that really wants to support your life. When you get here, you get to play this golf tournament, you get to create merchandise. We sign you up with, for example, Athlete Licensing Company. And so you have an opportunity to consider and say, “Why would I go anywhere else because I know in college it’s going to be expensive. If I can get some tuition help being a baseball player, for example, maybe I’m on a half-scholarship, and I can complete a full scholarship by doing NIL activities.” It’s just another tool for schools to use in the arms race to keep athletes. We were always considering something of weighing one school versus another. This is just now another opportunity to consider.
Q: Some would say all Group of 5 schools are at a significant disadvantage with collectives. But not so fast. The school right down the road from me, SMU, has extremely prominent alumni and very deep-pocketed donors. That could level the playing field against some P5 schools, right?
BRAMHALL: Let’s not disregard the truth that a great coach is a great coach. Yes, while everybody chases the money these days and a coach usually leaves a small school for a bigger one, great coaches make great athletes. And so even if you have the top recruits, you’re going to have a better opportunity to have better pitching or a better quarterback or a bigger, stronger team. But you still have a coach that can make winners out of what they have. So a Group of 5 school, maybe in the auxiliary sports that aren’t football, can still have a coach that comes in and makes winners. I don’t want to discredit coaches and say the only thing that’s going to determine wins is name, image and likeness money. It’s just another recruiting advantage. It’s another step in the game for schools to support their own people, just like any country has ever done — get the most resources and have the best economy.
Q: The NCAA is asking questions at Oregon and Miami concerning some broader NIL deals. No one is sure if the NCAA truly has the will to serve as the enforcement mechanism in the NIL space. Does there need to be enforcement, and is the NCAA the right entity to do it?
BRAMHALL: We’re going to have to have some type of monitoring. But I don’t know who the best entity is. And the reason is I think there’s a conflict of interest in the NCAA maintaining the amateur model and the ability to really profit so much off of the athletes. It’s going to go toward licensing to be on TV. Whether the NCAA or whoever owns the rights of the production, to play on TV, you’re going to have to pay the players just like the major league players and NFL players; they get money when they’re on a video game or when they’re on TV. It is going to go toward a model that you really do have to compensate those people who are appearing. I don’t know who the best enforcement agency is yet. But there’s going to have to be monitoring. And the reason there’s not yet is because there’s too many moving parts to really know what is best right now. People are making mistakes. And then they’re going back and they’re doing it right and figuring it out. Everybody’s trying to stay in-bounds. But there’s always been that market, as you know, “the bag man.” We are being able to make it transparent, and bring it to light and show the money. There used to be money transferred to the athlete and some bag man in the middle was taking a cut. Now we’re showing that money, where the athletes’ money actually went, and where the athlete in the future can say, “I don’t need that bag man anymore. I’m valuable on my own.” So now that it’s being legalized, I really do think that we’re able to bring better light. They are just letting it play out for now. The enforcement agency is going to be tough because we’re just going to have to be under some guidelines. But at the same time, it’s a free market, right? I mean, if you’re an Instagram person, and you’re not an athlete, it’s a free market. You do the deal you want to do, you’re paid the market value you want to get paid for.
Q: Collectives are launching by the week. Is your phone ringing off the hook; is your email inbox blowing up? How’s business?
BRAMHALL: It is the busiest I’ve ever been — from calls to networking opportunities to the actual work that we need to get done, and the decisions we’re making as a company. It’s growing so fast. And what’s exciting is it’s a market that’s never been seen before. The structure is what we’re making it be, rather than falling into the “This is how the Internet works, or this is how this works.” We are creating this market as we go. And so we’re able to kind of modify it and mold it to our needs, and to the needs of the athletes, which has been actually really fun.