The evolving value of a college roster spot

Over recent years we have seen a shift in the value of sports education as student-athletes increasingly have financial opportunities extending well beyond the historical scholarship model.

We have seen three important shifts to the governing rules of college and high school sports: (1) Name, Image, and Likeness (NIL) becoming a viable revenue stream for college student-athletes, and to a lesser degree, high-school student-athletes; (2) Historical college sport-by-sport caps/limits on scholarships being removed or significantly increased; and now (3) A potential House v. NCAA settlement ruling tomorrow providing significant payments to former student-athletes, including up to 22% or c. $22 million of college sports revenue being shared with current and future student-athletes.

Complementing these shifts in regulation are the realities of the technology and social dynamics of this generation of student-athletes. We are living in a world where student-athletes have a direct ability to reach and influence their own audiences via social media, a dynamic that adds fuel to this moment. These student-athletes are undoubtedly able, unlike any prior generation, to directly drive engagement for the brands they represent, including their colleges.

Lastly, colleges are increasingly seeing sports on campus as having clear and direct impact to student experience and on enrollment funnels. Sports is among the few investments a college can make that (1) positively impacts student experience and builds community for all students at the school, (2) positively and broadly impacts alumni relations and donor activation, and (3) serves as a high-quality brand platform in a highly competitive environment, driving the volume and quality of college applications.

The upshot of these converging trends? A simple reality: the value of sports education and the value of a roster spot are increasing for student-athletes.

Historically, the benefits of being excellent academically and athletically were limited to a college scholarship. A scholarship is a game-changing opportunity for so many families around the country. Today and increasingly in the future, the opportunity will be even bigger.

Big seven-figure NIL deals may seem mainstream due to the press coverage, but in truth, a very small portion of college student-athletes receive significant six or seven figure NIL compensation. While I expect the size and breadth of NIL compensation to grow, as or more interesting to me is the impact of the elimination of historical scholarship caps, combined with the impact of collegiate revenue sharing for student-athletes.

We are still in the very early days of understanding the new allocations and size of this expanding value proposition, but my prediction is we will see significant, five and six figure, financial opportunities for many of the 400,000+ college student-athletes around the country.

Critically, these opportunities are not without challenges. I see too many stories and focus on the "deals" and the "money." While those storylines are good for clicks and advertising, they are not helping our families. We need to be talking more and doing more in education and preparation. As high school and middle school educators, our job is to prepare students for all aspects of college and life.

This evolving opportunity for student-athletes means we have a new obligation to teach, support and prepare our families to meet the moment. We see four focus areas:

• College matriculation education: The shifting value proposition in college is evolving and confusing, and it has a big impact on student decisions related to college matriculation. College counseling and sports recruiting need to evolve to create more clarity for families.
• Character development: Identity, personal values and confidence are more important now than ever. Social media has its benefits, but it also comes with big challenges for teenage students. These challenges are heightened in sports, when factoring in NIL. The baseline question a student must answer is: who am I? Attaching personal identity to third party brands for money and agreeing to post on social media are a big decision. A student should first think hard and define their personal values and goals. Students need confidence in their "who am I?" and their personal values in a sometimes unforgiving social media world.
• NIL and social media education: Rules and regulations can vary state by state and are a moving target right now. Families need to understand those rules, and they need support on the basics of contracts, key terms, and where to turn for help. Beyond those building blocks, students are asking about personal brand building and appropriate and strategic use of social media. As educators, our job is not to find or facilitate financial transactions for students; however, it is our job to make sure the students are prepared and confident to handle those opportunities.
• Financial education: With more money being distributed more broadly and earlier than ever before in sports education, our students increasingly need a strong baseline of financial education in high school; from opening bank accounts to budgeting, saving and investing. These are critical skills to develop. There are money-related emotional skills to develop, too. As a college student athlete, having an income comes with social pressures and new social dynamics related to money. That challenge is trickling down to college and high school now.

Let's keep evolving to win our families.

Brent Richard
CEO, IMG Academy