Year 2 NIL money pouring in even greater despite cautionary tales

At this time last year, D’Eriq King, Spencer Rattler and DJ Uiagalelei were three of the faces of the new Name, Image and Likeness (NIL) rules. 

Three quarterbacks at prestigious programs who were profiting off their potential and social media followings, players expected to put up big numbers and contend for the Heisman Trophy. 

Instead, their statistics failed to match their bank accounts. All three struggled. King and Rattler lost their jobs at Miami and Oklahoma, respectively, while Uiagalelei faced heavy criticism as Clemson failed to win the ACC for the first time in seven years. 

It would seem to make sense for those examples to scare off companies from investing in unproven talent. How much value can an athlete have from the bench? They theoretically became sunk costs. Reality has played out very differently. 

“I don’t think it’s impacted the market one bit,” sports agent Dusty Stanfield of Inspiration Athlete Marketing told The Post. “As a matter of fact, the money going into NIL is substantially greater than it was last year. If I had to put a guess on it, I’d say three-to-four times more.” 

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Now, part of that is the rise of collectives in the sport, NIL groups paying entire college football teams. It is taking place all over. At Texas Tech, each player is making $25,000. Another factor is that a lot of these deals aren’t tied to on-field success, pointed out Ayden Syal, the chief executive officer of MOGL, an online marketplace that connects businesses with athletes. 

A college athlete’s social media following is what drives a lot of these agreements, and so while not performing obviously doesn’t help drive the player’s value, it isn’t as significant as it may seem. 

“Performance doesn’t directly contribute to NIL value,” Syal said. “Performance is a future indicator of the value of the athlete and brand ambassador. What’s truly driving or being purchased as a brand is the current following and reach and engagement rate.” 

It is also part of the endorsement business. Companies understand they are taking risks. Take Dr. Pepper, for example. Uiagalelei was the spokesperson for its Fansville ad campaign last fall. This year, it merely went with more of a sure thing, in defending Heisman Trophy winner Bryce Young of Alabama. 

“The money is always going to be there,” said Robert Narvaez, the executive vice president of global sports market and partnerships at BlueChip, a digital company that works directly with thousands of college athletes. “It’s just who they’re paying those dollars to. It’s an ugly game. The kid from Miami gets hurt, who’s the next kid up? Who are we going to spend the money on?” 

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Companies are paying college athletes less than professionals and in some instances getting rewarded for it, because every-day people have more in common with them, said Luis Pardillo, the CEO and founder of Dreamfield.co, a company similar to MOGL. Stanfield, who represents King, said the brands they worked with never complained about his client’s struggles. They were thrilled by the effectiveness of working with him. King had an endorsement deal with the Florida Panthers that became national news. 

“For the money they gave him, they got so much brand exposure,” Stanfield said. 

The market is changing. There are the collectives that have expanded well beyond the star quarterback. More athletes are being educated by their schools on the importance of creating social media brands and creating value for themselves, Stanfield said. Companies, in turn, have become rigid, offering a set amount strictly based on social media followings, whereas last year agents and players were setting the price. 

“It’s more of a take-it-or-leave-it approach,” Cardillo said. 

What hasn’t happened, though, are past failures scaring off companies. There are more companies in the NIL marketplace and more money being distributed. Even players in high school are cashing in, as companies look for the big star before they become a huge name. 

Not everyone will benefit, of course, which is the price of doing business in this new NIL world. 

“There are always going to be winners and losers in the endorsement game,” superagent Leigh Steinberg said. “There will be some deals that will turn out better than expected and there will be some deals that turn out worse than expected.”