When he’s not throwing touchdowns, Texas quarterback Arch Manning is shooting social media content for his sponsorship with Red Bull. The athlete has an NIL valuation of $6.5 million. Keep in mind, the 19-year-old is still in college.
The minimum salary for an NFL rookie in 2024 is $795,000. Meanwhile, college athletes are earning in the millions for sponsorships with major brands like Beats by Dre, Powerade, and Cheez-It.
Before 2021, the NCAA did not allow student-athletes to monetize off NIL (Name, Image, and Likeness). When NIL legislation was initially announced, players seemed to be securing marketing deals from brands on the outside. Today, the focus is on NIL collectives, which schools are using to their advantage to recruit players.
Colleges cannot pay their players directly. However, there is a backdoor method in which they lure players while maintaining legal compliance. A third party can informally or orally promise an athlete a certain NIL deal if they sign with their college over another college.
To convince athletes to come on board, schools pull funds from alumni, fans and other donors. The money gathered for the collective is then put towards paying the player for meet and greets, charity work, or providing additional funding for brand deals.
“NIL collectives have changed the recruiting process for athletes into a business much more than a development for the athlete,” says NFL agent Jesse Foreman. “What I think most fans are not aware of is just how many people in the system are thinking about the short-term financial implications and their own benefit in the process—not what’s best for the athlete’s future in the sport.”
Agents are taking up to 20% of athletes’ collective offers in the transfer portal. Although this is a standard managerial fee, a collective is less of a marketing deal and more of a negotiation with a school. “NFL negotiations we have with team agents are capped at three percent,” says Foreman. “I think the space needs regulations on who can be an agent for NIL transfer deals and a cap on how much they could charge. There are a lot of people working in this field, currently with the wrong intentions, and not looking at the long-term success of the athletes.”
Athletes are at risk of being taken advantage of if they take the largest amount of money offered, without considering the percentage an agent is asking for to negotiate the NIL collective offer. However, AP Comeback Player of the Year Joe Burrow doesn’t see following the money as an issue.
“If you’re going to be able to make seven figures in college, you’ve got to go take advantage of that,” the Cincinnati Bengals quarterback expressed in a recent appearance on “The Dan Patrick Show.” “If you’re in high school and you’re getting offered that, go wherever they are paying you the most.”
MJ Wright, former wide receiver for the Fordham Rams, says that he would have sacrificed a strong athletic program for a better NIL deal when he was playing college football.
“You’re making way more money in college than you are if you’re pursuing the NFL or professional sports,” he claims. “If I was in college right now, my decision would be based on my future. That’s a different type of generational wealth. You can invest that for years.”
The NIL business has become so lucrative, some athletes are choosing not to declare for the NFL Draft. Players become eligible three years after they are removed from high school, yet some are delaying the process due to NIL potential.
“If they have collegiate eligibility left, they might be convinced to stay in college to continue to earn guaranteed NIL income for themselves and their family,” explains NFL agent Tara Di Luca. The average playing career length in the NFL is only three years. An athlete may appreciate the opportunity to profit off their talent and image pre-NFL, especially when they might not have received a full scholarship to cover the costs of their education.
The average annual tuition for public, four-year colleges is $11,610 for state residents and $30,780 for out-of-state residents. In comparison, the average college athlete earns $1,000 to $10,000 from NIL deals, which is up to one third of their tuition. Not every athlete is earning Arch Manning numbers, but a little goes a long way in funding schooling.
“Depending on location, a $10,000 NIL deal could cover around eight to ten months of rent in a
shared apartment, a full year of groceries or essential expenses like textbooks, transportation and meal plans,” explains Nicholas Raffin, a financial advisor.
Although a $1,000 NIL deal might not seem like it would make a dent, Raffin says it could partially cover athletic gear while allowing for professional development opportunities. These earnings help bridge financial gaps that scholarships or family support might not fully cover and improve the overall affordability of attending college.
