NIL Story

The

revolution

AN INSIDE LOOK AT HOW LSU IS AT THE FOREFRONT OF HELPING STUDENT-ATHLETES CASH IN ON THEIR FAME.

The

revolution

AN INSIDE LOOK AT HOW LSU IS AT THE FOREFRONT OF HELPING STUDENT-ATHLETES CASH IN ON THEIR FAME.

By David Jacobs

HINTON

Major Burns was a football star at Madison Prep Academy in Baton Rouge and temporarily committed to LSU before signing with the University of Georgia. But in 2021, after one season in Athens, Burns announced he was coming home to play for the Tigers.

“I wanted to have a chance to be in my brother’s life, and be a positive role model to him,” he says. “Coming back home, I felt like I would be able to have a positive impact on my city.”

Burns says his teenage brother lives with him much of the time. Along with brotherly wisdom, he provides financial support thanks to two endorsement deals that pay him for his “name, image and likeness,” commonly known in the rapidly changing world of intercollegiate sports as NIL.

While paying student-athletes to play is against

“I wanted to have a chance to be in my brother’s life, and be a positive role model to him.”

MAJOR BURNS, an LSU safety who is able to provide his family financial support, thanks to two NIL endorsement deals.

National Collegiate Athletic Association rules, under-the-table payments have long been common. Former LSU men’s basketball coach Will Wade was suspended and eventually fired after he was caught on an FBI wiretap discussing money he planned to offer a recruit, to name one of many examples.

Pay-to-play is still not allowed, and coaches or boosters who promise a recruit an NIL deal in exchange for signing with their school can get their programs in trouble, at least in theory. But once they get to campus (and sometimes even before), NIL allows athletes, and the brands that sponsor them, to cash in on their fame.

Where some traditionalists see the downfall of amateur sports, others see a long-overdue opportunity for college athletes to openly share in the riches their labor generates. The rules are vague and in flux, and enforcement of them as they exist has been questionable at best.

But no one seems to think there’s much chance of cramming the NIL genie back into the bottle.

AP PHOTO/MATTHEW

LSU has been at the forefront of the NIL revolution, and Tiger officials and boosters want to stay there, or else risk being left behind.

THE LEARNING CURVE

When he’s done playing, Burns wants to own a sports training facility similar to Traction Sports in Baton Rouge. He’s thankful for the financial literacy classes LSU provides, because unlike scholarships or student financial aid, NIL revenue is taxable.

“That was a lifesaver for me, because I didn’t know anything about taxes,” Burns says.

Taylor Jacobs, a former collegiate tennis player, is an associate athletic director for LSU and the

department’s point person for all things NIL. The players are entrepreneurs now, and LSU ensures their education includes lessons about saving, investing and setting up a small business entity, she says.

“A lot of our student-athletes have been very successful in the NIL space, and they’ve been able to take this as an opportunity to learn how to set themselves up financially for when they are done at the collegiate level,” Jacobs says, adding that some of those opportunities have led to jobs after graduation.

You can’t just hand a player a check and call it NIL; they have to actually do things in exchange for the money. Living up to their end of the deal usually requires

promoting brands on social media and often includes making public appearances.

While athletes who are superstars and/or have massive social media followings can earn more than $1 million a year, the typical numbers are much lower and vary depending on the prominence of the athlete and their sport. In Southeastern Conference country, football typically is king, followed by basketball, notes Mackenzie Landry, chief operating officer with Matchpoint Connection.

LSU’s women’s basketball team is particularly marketable, thanks to its on-court success and the charisma of its players.

“If you are recognizable outside

of your sport, that obviously ups your value,” Landry says, adding that being a good public speaker also helps.

MatchPoint provides backoffice support for Bayou Traditions, a consortium of boosters that col lectively funds NIL deals for LSU athletes. While businesses also deal directly with athletes, collectives are the most important players in the NIL game.

MatchPoint handles contracts and payouts to athletes and helps determine what deals should be worth. For the LSU football team, scholarship athletes get a baseline deal of $25,000 annually, though some players earn more, while “walk-on” team members who are

THE MATCHPOINT CONNECTION EXECUTIVE TEAM: Krystal Faircloth Brian Oliver, and Jonathan Pixley.

“No athlete at LSU is making anywhere near seven figures [from the collective]. These kids are making tens of thousands of dollars, not millions.”

CARLOS SPAHT , president, Bayou Traditions

not on scholarship have a $6,000 baseline.

For an athlete in a less marketable sport, as little as $1,000 can be enough to make them happy, Landry says.

“We’re trying to raise awareness for the collective,” she says, when asked what players do for their deals with Bayou Traditions. “We need them to help us with that.”

BUILDING THE BRAND

Total spending for the third year of NIL could reach $1.7 billion, according to NIL company Opendorse. About $1 billion was spent in the second year, about three-quarters of it by collectives. Opendorse predicts collectives affiliated with top-tier schools will need to pay out about $10 million during the third year to be competitive.

Although recruiters are not supposed to promise an NIL deal, they can tout the strength of a school’s NIL support, notes David

Fleshman, a Baton Rouge attorney with Breazeale, Sachse & Wilson whose practice includes NIL.

“They’re highlighting the accomplishments of the brand,” he says of LSU. “It’s very important for recruits to see a school’s approach to NIL.”

Some states have passed laws to let their schools get more directly involved in NIL than the NCAA allows and shield them from NILrelated sanctions. The NCAA argues that all members agree to comply with association rules, regardless of state law, possibly setting the stage for future court battles.

“I think it’s very problematic for NCAA institutions to run to their legislature to basically try to get some sort of protection for violating the rules that they’ve agreed to follow,” Fleshman says.

For now, LSU supporters say the playing field is level, though Jacobs warns her staff to always be prepared for new NCAA guidance or a new state law. There is a bipartisan

WHAT THEY’RE WORTH

Here are the top 10 LSU athletes as ranked by NIL valuation, according to sports media group On3, as of August 29, 2023.

OLIVIA DUNNE

Junior, Gymnastics 12M followers* $3.2M

ANGEL REESE

Junior, Women’s Basketball 5.1M followers* $1.7M

FLAU’JAE JOHNSON

Sophomore, Women’s Basketball 3M followers* $1.1M

MALIK NABERS

Junior, Football 26K followers* $718K

WILL CAMPBELL

Sophomore, Football 29K followers* $596K

HAROLD PERKINS

Sophomore, Football 58K followers* $594K

JAYDEN DANIELS

Senior, Football 98K followers* $562K

MAASON SMITH

Redshirt Sophomore, Football 26K followers* $312K

ZALANCE HEARD

Freshman, Football 3.2K followers* $268K

MEKHI WINGO

Junior, Football 11.7K followers* $227K

*Includes instagram, TikTok and X

DON KADAIR

“I’m sure on some level it’s affecting the dollars that are coming into [the Tiger Athletic Foundation], but we’re not looking at it like that.”

MATT BOREMAN , CEO, Tiger Athletic Foundation

push for federal legislation to standardize NIL regulation, with at least three bills pending in Congress.

One change Landry would like to see: Now that college athletes can have agents, the agents should have to be registered and licensed like those who represent professional athletes.

“Sometimes, we have people the athlete doesn’t even realize is calling on their behalf,” she says.

Numerous coaches, administrators and outside observers argue that NIL is often pay-to-play by another name, with athletes getting compensated far beyond any realistic assessment of their marketing value. So far, only one NIL-related NCAA infraction has been made

public, though insiders believe more are on the way, and Landry predicts audits of collectives and deals.

“They’re going to make an example of somebody,” she says.

A TEAM EFFORT

Bayou Traditions officially launched in January with Brent Cunningham, who held a similar post with Texas Christian University’s collective, as president. But as he prepared to move his family to Baton Rouge, he reconsidered and backed out of the job.

After the Bayou Traditions announcement, Texas A&M announced plans to have the university’s 12th Man Foundation

(their equivalent of the Tiger Athletic Foundation) establish an NIL department. TAF and Bayou Traditions might have followed suit, with TAF absorbing the collective. While it makes sense not to have two entities chasing the same donor base, working for TAF isn’t what Cunningham signed up for, and uncertainty about his role made him uncomfortable about uprooting his family, says attorney Carlos Spaht, who currently leads the collective. But as it turned out, the NCAA and the IRS had issues with A&M’s design, A&M officials scrapped their plans (though the 12th Man Foundation still plans to use unrestricted donations for NIL), and the rest of the college sports

world including LSU took notice.

So Bayou Traditions remains independent, though it isn’t seeking a new full-time president. Spaht and developer Russell Mosley comanage the collective, with Spaht currently serving as president and leaning heavily on MatchPoint’s expertise.

“I have no idea what the market is for a five-star recruit,” Spaht says. For its first six months, the collective, then known as Geaux Enterprises, was wholly built on large booster donations. But it now accepts donations of any amount and offers annual subscriptions ranging from $100 to $50,000. The collective’s finances are not made public.

DON KADAIR

LSU’S MAJOR PLAYERS OF NIL

“If you are recognizable outside of your sport, that obviously ups your value.”

TAYLOR JACOBS , associate athletic director, LSU and point person for NIL

Bayou Traditions also has launched the Livvy Fund, named after LSU gymnast (and NIL millionaire) Olivia Dunne, to provide LSU’s female athletes with industry tips and connections. And Spaht plans to hire a writer to provide exclusive content about recruiting as an additional benefit for subscribers.

In many cases, the collective’s goal is to pay the student-athletes enough to effectively make a partial scholarship into a full ride. Making the athletes “scholarship whole” takes care of about 90% of them, Spaht says.

“No athlete at LSU is making anywhere near seven figures [from the collective],” he says. “These kids are making tens of thousands of dollars, not millions.”

While TAF doesn’t raise money for NIL, the foundation’s fundraisers do refer potential contributors to the collective. So far, donors to LSU athletics seem happy to support both entities.

A little over $71 million was contributed to TAF and LSU athletics in 2019, says Matt Borman, the foundation’s CEO. While donations dipped the next two years, which Borman blames on the pandemic, the total hit a record high of $92 million last year and reached $83 million by August of this year, he says.

“We certainly understand there’s only a certain number of dollars out there that LSU fans can invest in our programs,” Borman says. “I’m sure on some level it’s affecting the dollars that are coming into

SCOTT WOODWARD

LSU athletic director and top executive for Tiger sports

TAYLOR JACOBS

An LSU associate athletic director and the department’s NIL point person

CARLOS SPAHT AND RUSSELL MOSLEY

Co-leaders of Bayou Traditions, a collective of LSU boosters who support NIL deals for Tiger athletes

MACKENZIE LANDRY

COO of Matchpoint Connection, which connects brands with talent and supports Bayou Traditions’ operations.

MATT BORMAN

CEO of the Tiger Athletic Foundation, which raises money for LSU athletics. TAF doesn’t fund NIL deals, but it does refer potential funders to the collective.

it like that.”

Borman and Spaht say it’s not a competition because everyone is essentially on the same team. The system seems to be working for LSU so far, but everyone involved stays ready to pivot. “We’re all building the plane while we’re flying it right now,” Borman says.

NECESSARY, BUT NOT SUFFICIENT

Does NIL success translate to the field or court? LSU’s championship-winning baseball and women’s basketball teams certainly have benefited, but highly regarded programs tend to attract more money, so it’s hard to say how much causation can be found in that correlation.

In college sports, winning often begets more winning, since top recruits want to compete for titles. Perhaps NIL is just one more factor that separates the haves from the have-nots, along with worldclass facilities, respected coaches and a track record of producing professionals.

But while NIL money might prove to be a necessary (if not sufficient) condition for winning at the highest level, the uneven distribution of those dollars has the potential to wreck team culture. LSU head football coach Brian Kelly is wary of players who are too concerned about NIL.

“If they feel like they need to be compensated financially, they’re looking at it the wrong way,” Kelly told the Rotary Club of Baton

WOMEN ATHLETES REIGN SUPREME AT LSU

WHILE WOMEN PROFESSIONAL athletes have traditionally been paid a fraction of what male athletes earn, a few select female student-athletes at LSU are turning the tables, crushing their male counterparts when it comes to cashing in on the ever-growing NIL bonanza.

Harnessing her massive social media following, gymnast OLIVIA DUNNE became an early success story for NIL after breaking $1 million in deals by October 2021, a mere three months after the rules were changed to allow for such deals. At the time, she was the most followed NCAA athlete across social media with more than 5 million followers.

Today, she boasts a social media following of more than 11 million strong—with 7.7 million followers on TikTok alone—and has an NIL valuation of $3.3 million thanks to deals struck with brands such as American Eagle and Vuori Clothing, according to On3. Dunne is not only the most valuable LSU athlete when it comes to NIL but has the second-highest valuation among all NCAA athletes, male or female.

Looking to build off the momentum of her own success, Dunne launched The Livvy Fund in July in partnership with Bayou Traditions, LSU’s NIL collective, with the goal of connecting more female student-athletes with profitable NIL deals.

But Dunne is not the only LSU female athlete to discover NIL gold. Following a successful national title run this year, the women’s basketball team also features stars—namely ANGEL REESE and FLAU’JAE JOHNSON—inking high-dollar deals.

Before the NCAA championship tournament, Reese was valued at $370,000, according to On3. Since the championship, she has struck deals with household-name brands such as Raising Cane’s and Dick’s Sporting Goods, skyrocketing her valuation to $1.3 million, sixth among all

Along with their growing portfolio of NIL deals, Dunne and Reese this summer became the first college athletes to be Sports Illustrated’s swimsuit edition. Meanwhile, Johnson, the daughter of a Georgia hip-hop artist, recently signed a record deal with Jay-Z’s Roc Nation as a rapper.

LSU’s strong reputation in helping score NIL money for its student-athletes, both male and female, has become an important recruiting tool and reportedly played a key role in landing incoming women’s basketball transfer players Hailey Van Lith and Aneesah Morrow, who announced her transfer from DePaul in an Instagram video that was part of an NIL deal with Caktus AI.

TAF, but we’re not looking at

Olivia Dunne

Angel Reese

MARK TERRILL/INVISION/AP

ASSOCIATED PRESS

HOW WE GOT HERE

2019

September 2019: California becomes the first state to pass a law allowing student athletes to be paid for the use of their name, image and likeness.

January 2021: The NCAA backs off of a commitment to enact rules for NIL by the end of 2021, attributing the decision to antitrust concerns from the Justice Department.

July 2021: The NCAA enacts rules that officially remove the restrictions on college athletes being compensated for their name, image and likeness; athletes begin pursuing deals.

October 2021: LSU gymnast Olivia Dunne reportedly rakes in more than $1 million in deals, becoming an early success story in the NIL era.

June 2022: Louisiana passes legislation lifting restrictions against schools directly or indirectly arranging for a third party to provide compensation to a student-athlete through NIL, granting collectives more power in NIL deals.

July 2023: Three U.S. senators propose bipartisan legislation that would set national standards for NIL deals as well as create the College Athletics Corporation, a nongovernmental entity that would hold investigative and subpoena powers.

2020

October 2019: With 20 other states considering laws similar to California’s, the NCAA meets in Atlanta to ask each NCAA division to create new NIL rules “in a manner consistent with the collegiate model” by January 2021.

June 2021: In NCAA v. Alston, the U.S. Supreme Court rules 9-0 that the NCAA can no longer ban schools from providing education-related benefits to college athletes, setting the stage for further legal challenges to restrictions against compensation.

2021

2022

July 2021: Louisiana passes an NIL law and becomes one of the first states to see the legislation go live, effective July 1, 2021. Senate Bill 60 grants intercollegiate studentathletes the ability to earn NIL compensation.

February 2022: Alabama becomes the first state to repeal its NIL law, after its legislation proves more restrictive than the “interim” NCAA policy being followed by schools in states without laws in place. The NCAA begins a review of how recruiting and other aspects of college sports are being affected.

2023

October 2022: The NCAA clarifies NIL policy, establishing more defined regulations regarding athletes’ NIL activities.

SHOW THEM THE MONEY: AN NIL PRIMER

LOVE IT OR HATE IT, there’s no denying the arrival of NIL—the three-letter acronym for name, image and likeness—has transformed college sports forever.

When the NCAA’s board of directors officially suspended rules that prohibited student-athletes from making money off their fame in the form of their name, image and likeness, it essentially resolved the long-standing question of whether college athletes should receive compensation.

Still, NIL does not mean compensation in the same way that professional players receive it. As of now, the NCAA prevents schools from directly paying players, maintaining the association’s status as a purveyor of amateur sports. NIL is essentially a workaround. Athletes receive compensation, but it comes through sponsorship deals signed by individual players.

The onus is on the schools to determine whether NIL activity is consistent with legal practices on a state-by-state basis and to follow NCAA rules put in place over the past two years.

Universities such as LSU have established collectives that raise and use funds to create opportunities for student-athletes to leverage their NIL in exchange for compensation.

But the NIL landscape still resembles the Wild West in many ways. The lines remain blurry on what is and what isn’t allowed when it comes to NIL deals. It is also a lucrative industry, the Associated Press reports, with about $917 million spent on deals during the first year of its existence.

According to the Sports Business Journal, at least 17% of NCAA Division I athletes have participated in NIL—a majority partnering with local businesses on deals.

Rouge. “If somebody’s focused on [NIL money], they’re not going to be a very good player.”

Business owners interested in adding NIL to their marketing efforts should look at both the size of an athlete’s social media following and the nature of the engagement, Landry suggests.

“Do your research on that person and make sure they align with your brand first, because if not, it’s not going to feel organic or authentic,” she adds.

Personal injury attorney Gordon McKernan says he has funded between 60 and 80 NIL deals for LSU student-athletes, not counting another 20 or so for athletes at other Louisiana universities, while maintaining his giving to TAF. He says adding NIL to a company’s marketing budget doesn’t have to be expensive, noting that NIL valuation websites can help.

“You can get a lot of benefit from just a well-placed post or a photo shoot,” he says.

For the athletes, the benefits go beyond the numbers on

the contract. Raising their profile now can open doors later, and McKernan says his firm helps athletes make connections that can boost their post-playing careers.

A public mistake can tarnish both brands, which is why McKernan says he looks for character, along with athletic talent and an interesting life story, in potential NIL partners.

For the sponsor, it’s important to do things by the book, he adds.

“I always tell my marketing group—I have an NIL department now—how this goes really bad for us really quickly is we do something that gets a player ruled ineligible,” he says.

While McKernan understands the concerns around NIL, he says NCAA institutions have been “profiteering from players for so long, it’s good to reset the field.” And he wants to do what he can to help Louisiana’s college sports programs stay competitive.

“This is the new world we live in,” McKernan says. “There’s an arms race going on.”

AP PHOTO/MICHAEL CONROY