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Thanks to New NCAA Rules, Student-Athletes Are the Hottest New Entrepreneurs Collegiate players are capitalizing on the ability to freely market their name, image and likeness, but does trouble lie ahead?

By Jason Falls

Opinions expressed by Entrepreneur contributors are their own.

UK Athletics

It's not every day you hear the word "deliverables" come out of the mouth of a 21-year-old. But Masai Russell isn't your typical young adult. The four-time first-team All-American in track and field at the University of Kentucky is also a successful social media influencer. She spoke of deliverables while characterizing the social media content expectations of her clients, i.e. sponsors of her Instagram and YouTube channels.

Mind you, Russell has only been working with these clients on deliverables for two months. The NCAA redefined its amateur rules in late June to allow college student-athletes to monetize their name, image and likeness (NIL). Until then, they could not accept payment for personal appearances, merchandise related to them or even sponsored content on their social media channels, even if their content had nothing to do with sports (despite the billions that colleges and the NCAA would earn by promoting and broadcasting their talents).

Pressure on the NCAA to allow student-athletes the right to profit off their own brands has mounted for years. But it was West Virginia University football player Shawne Alston's case that made it to the U.S. Supreme Court and scored the winning touchdown for student-athletes.

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Justice Brett Kavanaugh even wrote in the decision that the NCAA's business model "would be flatly illegal in almost any other industry in America."

The National Association of Intetcollegiate Atheltics (NAIA), an association of mostly small schools and the other main college athletic association in the U.S., passed NIL legislation in December of 2020, putting additional pressure on the NCAA to change or suffer the consequences.

So, student-athletes matriculated in August with a new set of rules. They could now make money to supplement their scholarships. For student-athletes at the top schools or with full-ride scholarships, NIL means icing on the cake. But for most others, it might be the difference in making ends meet.

According to the NCAA, Division I and II athletic programs pay out $3.6 billion in scholarship money annually to more than 180,000 student-athletes. But that's just $20,000 per person — $17,000 shy of the average total cost of private schools and $7,000 away from the cost of an out-of-state total package for public institutions. Many athletes only receive scholarships that cover tuition. Some not even that much.

NIL flexibility is thus not only fair, but needed.

The opportunity vs. the obstacles

Social media and the explosion of followers-for-sponsorships economy does give college athletes an easy platform to monetize their brand. The most heralded prospects in some sports accumulate hundreds of thousands of followers in high school. NIL at that level of competition hasn't yet become an issue for the courts, so college is the athlete's first shot at making money off their name.

Texas high school football phenom Quinn Ewers even dropped out of his senior year, opting to enroll early at Ohio State just to be able to capitalize on his NIL value. But the flipside is that NIL often gives the figurative keys to the Cadillac to teenagers and young 20-somethings who aren't ready to take on managing a business.

"We're still kind of somewhat kids at the end of the day," says Donovan Williams, a sophomore guard on the Oklahoma State men's basketball team. "Kids want money. That's just human nature. There's some money. We want to go get it."

Image Credit: Oklahoma State Athletics

Williams reported that three months into this new entrepreneurial environment, he knows some student-athletes who have already broken brand sponsorship commitments. "These are contracts!" he exclaims. "They are not something you want to take lightly."

Where trouble may be brewing

"It's really still the wild west," cautions Ahin Thomas, chief revenue officer for Tastes of Chicago, a direct-to-consumer pizza brand that has begun sponsoring student-athletes. "Some of the default contract templates have perpetual image rights written in. If a business is willing to be predatory, that's not right. I'll bet you there are a lot of college athletes who would sign a contract without reading it. They don't know what perpetual would mean."

Thomas said his company would never put a student-athlete in that position because it could take away opportunities from them later in life. "What if a Domino's comes knocking on their door one day?" he hypothesizes. "How horrifying is it going to be that they have a big endorsement deal, but these guys over here have perpetual image rights?"

Stanford women's basketball star Haley Jones agrees there are drawbacks to the NIL environment, particularly in making sure guardrails are in place to help those less business-savvy student-athletes balance the responsibility with the privilege. "I think a lot of student-athletes might fall into the trap of doing cash grabs and things that aren't what you want your brand to be a part of," she explains. "You can go make an appearance or do a quick Instagram post and get a quick cash-grab. But you also have to think about the long-term game. You've got to do the background checks and see who you're really getting into business with and who has your best interests at heart."

Jones led Stanford to its third women's basketball national championship last April and earned Most Outstanding Player of the Final Four. Potential partners may see her activations on Twitter or an Instagram feed with almost 40,000 followers. Just a junior this season, Jones knows a WNBA career may lie ahead, but is also using NIL as a longer-term investment.

"Beyond basketball, now I can start to build my brand and show what I'm into, what I'm passionate about," Jones says. "By the time I'm done playing basketball, I can really dive into those and have things lined up."

Kentucky's Russell, who aspires to one day run her own fashion brand, has 156,000-plus followers on Instagram and a growing audience of 21,000-plus on YouTube. Her focus is similar.

"I'm really looking for ambassadorships rather than partnerships," Russell says. "I really want to build an empire, a brand and a legacy for who Masai is. If I'm modeling for another company, why can't I be modeling for my own company? That's how I'm thinking about it."

Chloe Mitchell and her father Keith, a former Michigan football player, started a company to help student-athletes connect with brands and fans. She has a different take.

Image Credit: Rachel Campbell

"To each their own," she offers. "The ones who want to build their brand and think long-term? We help them do that. The ones who want to make a couple hundred bucks? That's fine, too."

Mitchell accumulated 2.6 million TikTok followers doing DIY home projects during her high school pandemic days. When she enrolled at NAIA institution Aquinas College last fall, she had to say goodbye to influencer deals. But the NAIA's December option to allow NIL re-opened Mitchell's earning power and gave her a head start on aiming for the bigger business idea of building an agency. She says her experience with brand deals puts her in a unique position to help student-athletes who want to grow their legacy, but also those who just want to make some side money.

"Some know they're only in college for four years and need to take advantage of it," she surmises. "There's nothing wrong with that."

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Managing the game plan

Most college athletes were not expecting NIL to happen so quickly. The Supreme Court decision came on June 21 of this year. The NCAA's announcement arrived nine days later and the policy went into effect the following day. Most fall-sports freshmen reported to campus just days after.

"This started for me two years earlier than I expected," Jones says. "I expected to sign with an agent right when I am about to get drafted, right when I'm graduating, not heading into my junior year."

Oklahoma State's Williams was ahead of the game, moving to sign with MAGZ Sports Group and partner with homonymously named Donovan Watches as soon as the rules allowed. "I was prepared," he says. "It was two or three months prior to them letting it go through. Once (the NCAA) gave us the green light, I took action on everything."

Williams promotes the watches, his own custom apparel and has a deal with a sports jersey company. He uses Instagram, Facebook, Twitter and Snapchat to connect those brands with his fans. But not many student-athletes are as entrepreneurial as Williams, Jones and Russell. College athletic departments aim to point them in the right direction.

"I consider it a part of our education mission in the athletics department for our student-athletes to understand how to market themselves and be the CEO of their brand," says Ray Tanner, Athletics Director at the University of South Carolina. "I want to make sure that our student-athletes are able to take advantage of all the opportunities that NIL can bring."

Thomas of Taste of Chicago feels brands have a responsibility in that equation, too. "We've decided to write our contracts in plain English and not ask for image rights in perpetuity," he explains. But he thinks many other brands will act in their best interests, not those of the athletes: "Just because you might be able to get away with it doesn't mean you should."

Jones sees potential trouble ahead, too. "I'm sure there's going to be some type of ESPN scandal breaking out of something happening where someone took the wrong deal," she says. "It's bound to happen. I knock on wood that it doesn't, but it's bound to happen."

Jones, who also mentors a class at Stanford this year, says NIL opportunities don't come if you aren't playing well. And if you aren't keeping your classwork up to date, you don't get to play at all.

"Already having to balance classes and basketball is enough," she says. "Now having to add in NIL opportunities you want to take full advantage of? You have to have an underlying understanding of where your priorities are. It's a domino effect of things that all have to be in place before you're even allowed to do these NIL opportunities."

Still, the lion's share of student-athletes know NIL provides just that: opportunities. "It's been amazing," Russell enthuses of her social media engagement. I never even noticed that all the work I was putting in this whole time has opened up so many doors for me now."

Jason Falls

Entrepreneur Leadership Network® VIP

Digital Strategist, Industry Analyst, Speaker, Author

Jason Falls is a noted author, speaker and influencer in the social and digital marketing space. He is the senior vice president for digital strategy at Elasticity, an integrated marketing firm with offices in St. Louis, Mo., and Louisville, Ky. He is the author of two books on digital marketing and a frequent analyst and commentator on the social technology space.

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