How much do agents make from NIL deals?
How much do agents make from NIL deals?
By Jason Bolton June 16, 2023 11:12
The answer to this question is not straightforward, as the fees charged by agents can vary widely depending on a variety of factors. However, there are some general trends and industry standards that can shed light on the issue.
Firstly, it's important to understand that the standard fee for agents marketing athletes is between 15% and 20% of the athlete's deal. This means that if a student-athlete signs an NIL deal worth $100,000, their agent could potentially take home $20,000 as their commission. However, it's worth noting that this figure is just a general guideline, and there are many factors that can impact the amount of commission an agent charges.
One major factor that can influence commission rates is the level of experience and reputation of the agent. Most agents in the sports and entertainment industry charge more than a 10% commission on deals procured and negotiated. Top-level agents with a track record of securing lucrative deals for their clients may be able to command higher fees than less established agents.
Another factor that can affect commission rates is the location of the agent and the state in which the student-athlete is based. California law, for example, provides that an athletic agent must comply with the state's regulations and charge a 20% commission on all NIL deals secured for the student-athlete. South Carolina, on the other hand, has set a cap on the amount of commission an agent can take on NIL deals at 10%. These differing regulations and requirements can impact the fees charged by agents operating in different states.
However, despite the potential for high fees, some sports marketing firms are taking a different approach to NIL representation. M:7 Sports, a sports marketing firm based in Beaver, Pennsylvania, has become the first of its kind to refuse to charge commission fees on any name, image, and likeness deals negotiated for student-athletes. The company's CEO, Jim Christiana, has urged other companies to follow the firm's lead and end the practice of charging commissions for student-athletes' NIL deals. Christiana argues that the practice of charging commissions is predatory and ensures that select athletes are the only ones who benefit.
So, what does this mean for student-athletes looking to secure representation for their NIL deals? Ultimately, it's important for student-athletes to do their research and carefully consider the fees and services offered by potential agents. While some agents may charge high fees, they may also have the experience and reputation necessary to secure the most lucrative deals. On the other hand, firms like M:7 Sports may offer a more accessible and equitable approach to NIL representation.
It's also worth noting that student-athletes must adhere to certain regulations when it comes to obtaining professional representation for their NIL deals. In California, for example, student-athletes may obtain professional representation from licensed service providers but are limited to NIL representation opportunities only and must pay fair market value for such services. Payment may be contingent on NIL deals secured, but extra benefits not explicitly included in the professional representation agreement are not permitted, as they may affect a student's eligibility. Student-athletes must also provide their school's compliance office with the name and contact information of any athlete agent providing professional representation, but the school will not assess the ability or reputation of an agent.
In conclusion, the fees charged by agents for NIL representation can vary widely depending on a range of factors, including the experience and reputation of the agent, the location of the agent and the student-athlete, and the regulations in place in a particular state. While some agents may charge high fees, others may offer a more accessible and equitable approach. Ultimately, it's important for student-athletes to carefully consider their options and ensure that any agreements they enter into adhere to NCAA regulations and do not conflict with their school's existing contracts.
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