The NIL Revolution: How College Athletes Are Taking Charge of Their Earnings

Until 2021, college athletes were required to give up their rights to use their Name, Image, and Likeness (NIL) if they wanted to maintain their eligibility to play collegiate sports. In simple terms, this meant that student-athletes could not make money from their own image or fame while playing college sports. But in 2021, the National Collegiate Athletic Association (NCAA) implemented rule changes that allowed college athletes to engage in revenue-generating activities like endorsing products, posting on social media, promoting merchandise, hiring agents to help them find paid opportunities, and even launch their own businesses. Essentially, it allowed college athletes to remain amateur athletes and maintain eligibility for collegiate sports while also allowing amateur athletes to create revenue streams outside sports.

NIL Has Changed College Recruitment

NIL has made a big impact on how colleges recruit athletes. Colleges have created dedicated NIL departments to help student athletes understand and navigate endorsement deals from their NIL. These departments give athletes information and support to make smart choices about deals they might make, making sure they follow the rules of the NCAA and maintain their eligibility to play.

Under current guidelines, recruitment departments can highlight potential NIL opportunities available at their institutions as part of their recruitment pitches and can collaborate with marketing and branding experts to showcase the potential commercial opportunities for athletes. Colleges are sharing success stories of athletes who have navigated NIL opportunities, and emphasizing the importance of support structures in place to assist athletes in managing their off-field ventures.

In addition to NIL opportunities from brands, college athletes often also receive deals from collectives formed by donors to a college's athletic program. For example, the Swarm Collective, made up of University of Iowa supporters, compensates quarterback Cade McNamara $600 per hour for engaging in community-focused activities, such as delivering meals to seniors and visiting children’s hospitals. Some college football players receive up to $25,000 per post for promoting the collective’s charity on social media.

Athletes Securing their Share of a Billion Dollar Industry

In the past, college athletes didn't get paid even though college sports made lots of money, with the NCAA making over $1.1 billion in 2022. But with the new NIL rules, college athletes earned nearly $1.2 billion in deals in 2022, according to a study by Opendorse, which keeps track of NIL deals.

Brands recognize the value of college athletes as influential brand ambassadors, and the college sports fanbase provides a unique and engaged demographic. The top-earning college athlete is Bronny James, with $6.1 million in earnings from deals with brands like Nike and Beats by Dre. (And, yes, he is the son of NBA superstar LeBron James.)

Recently, Angel Reese, a star player on LSU's women's basketball team, signed a big deal with Reebok that will last for several years. When Shaquille O'Neal took over as the president of Reebok's basketball department, signing Reese was his first move. She's expected to make $1.7 million, putting her in the top 10 highest-earning college athletes. But it's not only the superstars who are making money under the new NIL rules. In major college football programs, the average starting player can make around $103,000 per year, as reported by Opendorse.

Recruits are now considering factors beyond sports facilities and coaching staff, such as the institution's support for NIL opportunities, the presence of local businesses, and the potential for community engagement. Young athletes and influencers have new opportunities available to them compared with just a few years ago. Some states have passed laws that allow high school athletes to monetize their NIL, which will have a big impact on college recruitment. In the ever-evolving NIL landscape, it's critical to stay on top of these developments to ensure you can take full advantage of the opportunities available.