The Future for Collectives
Integral for the past four years—what to make of collectives going forward
Some collectives have already shuttered operations, either at the request of their universities or to avoid IRS scrutiny. Others have been absorbed by universities, and still others have simply rebranded and reloaded—typically to avoid underperformance or liability. But in this four-year period of no formal payments from schools to their athletes, collectives have been instrumental in facilitating deals for players.
My favorite collective is my own—that of the University of San Diego. I love the people I work alongside, and I love the opportunity we’re providing for our great Torero athletes who otherwise wouldn’t have such robust earning potential. If I had to choose another favorite collective, it would be our neighbors to the north: House of Victory Foundation. They’ve done a great job implementing a for-profit solution to house major brand deals and corporate engagements, while also sustainably providing a tax-deductible option for donors—raising millions of dollars last year alone. House of Victory also benefits from exceptional alignment between the school, coaches, collective, and financial oversight. That’s not to say they don’t miss on some prospects or face the typical challenges of any three-year-old organization—but they operate at a high level. Their HOV newsletter, produced with Ole Foundation partner and board member-led Athletiverse, is well-done and a great read.
But enough about what I like—let’s talk about the future of collectives, as the title of this article promised!
Many collectives are offloading large stores of funds ahead of the fair market value challenges Deloitte and the NCAA are presenting as part of the likely soon-to-be-approved House settlement. Collectives want their teams to win, their players to be taken care of, and they want to easily facilitate incoming donor funding. They’re not so concerned with extracting maximum value from the athletes, nor are they eager to litigate against disgruntled players over transfers or NIL payments. Schools, on the other hand, are proving to be the shrewd “black hat” negotiators—quietly preparing for the revenue-sharing era by locking things down with paperwork.
The reason collectives will need to persist is because many elements of running elite basketball and football programs are either undesirable or outright impermissible under the NCAA’s flimsy standards. What do I mean? Well, consider the “bag men.” In a different era, these individuals went to jail or were fired for actions that were then deemed impermissible. But as we’ve seen with the restoration of Reggie Bush’s Heisman or the softening of criticism toward Johnny Manziel’s autograph dealings at Texas A&M, the shackles on college athletes are looser than ever. So, back to the bag men.
These figures play influential roles in training, mentorship, and overall athlete support. Whether they’re good or bad is subjective—but they are integral to making athletes feel confident in their school choices. Just like anyone else, athletes can be guided by the wrong people. There are bad doctors, lawyers, and mechanics—and similarly, the consequences of a misguided relationship may not reveal themselves for weeks, months, or even years.
Take this example: your reverend’s cousin played in the NFL for one season twenty years ago, back when the game revolved around the run, and you’re a modern dual-threat quarterback. Still, he’s the closest thing to a subject matter expert in your network. You trust your reverend. Your mom especially trusts your reverend. Your reverend trusts his cousin. So if A trusts B, and B equals C, and C leads to D—suddenly A equals E… kinda. Now your reverend’s cousin wants to accompany you on recruiting visits, get paid for his “consulting,” receive a donation to his son’s AAU team, secure daycare for his daughter, and land a job for his friend in Lexington, KY, inside the Kentucky healthcare system. Who would ever accommodate these requests? Well—if the player is good enough, the better question might be: who wouldn’t?
Delivering on this multitude of requests largely falls to the collectives. While most won’t enjoy the tax-deductibility that athletic departments offer, collectives can operate more freely outside the NCAA’s watchful eye. Payments to consultants, funding unofficial visits for prospects—these are the kinds of voids collectives have filled and will likely continue to fill.
The NIL industry is now beginning to show signs of strategic divergence, and it will be interesting to see how various athletic department choices—and their proverbial bets—pan out.