The Supreme Court’s decision against the NCAA paves the way for college athletes to be paid, though the court ruled only on education-related benefits and not broader compensation issues.
Former Notre Dame QB Brandon Wimbush’s internet start-up seeks to help current players make money by matching them with endorsement deals.
States and Congress are working to make the NCAA change rules barring such deals, and the court noted that legislation may offer a better solution than litigation for remaining issues.
As Brandon Wimbush sees it, his earnings power should have peaked in November 2017: ESPN used an image of him all week in onscreen promotions of a football showdown between Notre Dame and Miami, but Notre Dame’s then-starting quarterback didn’t see a dime from 65,303 tickets sold or the millions of dollars ESPN parent Walt Disney Co. pays for broadcast rights.
Soon, Wimbush’s start-up, Fort Lauderdale, Fla.-based MOGL Corp., may begin to change that, thanks to laws working through state legislatures and Congress, and also to the unanimous Supreme Court decision on Monday that ruled against the NCAA in an antitrust case limiting the National Collegiate Athletic Association’s rights to bar college athletes from getting paid.
The Supreme Court ruled that the NCAA had violated antitrust rules and should pay student-athletes for education-related benefits, though it did not rule on broader compensation questions, and in the decision said legislation may be needed to address remaining issues. But it is one more step in a multiyear battle to chip away at the definition of “amateurism” used to keep collegiate athletes from making money from the sports in which they excel.
The NCAA had argued that limits on athlete pay don’t violate antitrust laws because they promote consumer choice by distinguishing the college game from professional sports leagues. The case decided Monday covered whether athletes can be paid for their services, beyond the basic cost of attendance, and whether the NCAA’s rules against it violate antitrust laws. The case technically does not cover payment for endorsements, as new state laws do, but experts expect Congress to act on that shortly after the decision.
On July 1, Florida and Alabama will become the first states to overrule the NCAA on some of those broader pay issues and authorize athletes to make money off their name, likeness and image — including traditional endorsements, personal appearances and social media opportunities. MOGL is positioning itself as the first online marketplace to match college athletes with marketers to exploit their new rights, as Congress considers nationwide rules. A long list of states are planning moves later on to open the market for collegiate athletes to make marketing deals, including New Mexico, Mississippi and Georgia.
“I was that college athlete, I experienced that lack of opportunity,” Wimbush says. “The Miami game was one of the most-hyped games. I could have done a lot.”
MOGL is an audible for Wimbush, a former five-star recruit who hoped to be in the National Football League by now. The 24-year-old from national powerhouse St. Peter’s Prep in Jersey City was New Jersey’s Gatorade Player of the Year his senior year, beating teammate Minkah Fitzpatrick, now an All-Pro safety for the Pittsburgh Steelers. He’s also the son of a divorced mother who worked as a nurse. Like many athletes, he talks about having seen sports as a means to take care of his family, a goal frustrated by the NCAA’s ban on his profiting off his college playing career.
Most athletes’ brands reach peak value in college
As he came to grips last year with the idea that he wouldn’t be picked in the NFL draft, he was approached by Ayden Syal, a friend from Notre Dame who was then working in private equity, who had the beginnings of the idea for MOGL.
“Even though he went to [St. Peter’s archrival] Seton Hall Prep, he was a good guy, and it was an idea I could get behind,” said Wimbush, who majored in accounting while Syal studied consulting.
If it works, the company could change the balance of power in collegiate athletics between schools and athletes by helping athletes make a living while in school, Syal says. It also may help colleges build ties to local communities by having athletes promote local businesses, countering the NCAA’s longstanding argument that fans like college sports because athletes don’t get paid.
“In 99.9 percent of cases, college is when the value of athletes’ brands happens to be the highest,” Syal said.
Their site is a platform where athletes will effectively serve as their own agents, Syal said, matching their name, image and likeness to the listings from businesses, usually small businesses in or near college towns. MOGL weeds out businesses the NCAA would consider boosters trying to disguise illegal inducements to pick a specific school. That’s different from traditional agents who solicit bigger-dollar opportunities for a handful of top stars. If it works, the partners say, they’ll make much smaller deals but many more of them.
We’re not going to get Trevor Lawrence his ‘Head and Shoulders’ deal that will be worth millions. We’re the local source.
The idea is to connect the second tier of college athletes with mostly local businesses, such as car dealers and restaurants. Wimbush and Syal think marquee stars such as Clemson quarterback Trevor Lawrence, picked No. 1 in the 2021 NFL Draft by the Jacksonville Jaguars, and his successors at the top of the competitive mountain will sign with traditional agents in the world of paid college athletes that is about to dawn.
“We’re not going to get Trevor Lawrence his ‘Head and Shoulders’ deal that will be worth millions,″ said Syal, referring to Lawrence’s shoulder-length blond mane. “We’re the local source.″
One of their first clients is the Orlando North Seminole County Office of Economic Development and Tourism. The office worked through MOGL to contract three players for the National Women’s Soccer League’s Orlando Pride to promote a national youth soccer tournament through podcasts, videos and other social media. That effort supported a $33 million investment Seminole County has made in youth sports facilities to draw visitors, said tourism director Guilherme “Gui” Cunha.
“I absolutely love everything they’re doing,” said Cunha, a former college football player and high school coach himself. “Spending $6,000 to get three athletes was a steal.”
Wimbush and Syal have interns handling sales on campuses, Wimbush said, promoting MOGL in states where legislatures have passed laws, not yet in effect, to authorize athletes to cash in on their name, image and likeness despite the NCAA’s rules. Florida’s and Alabama’s laws will take effect first, but 13 states including California have passed similar laws, effective between now and 2023.
The largest number of states passing such laws so far are in the Southeast, home to high-profile Southeastern Conference athletic programs such as the University of Alabama, Auburn University, University of Georgia and University of Florida.
To date, Wimbush and Syal claim to have about 500 athletes signed up, though their identities won’t be released until the laws take effect in their states. For the athletes to endorse MOGL publicly before the laws take effect would violate NCAA rules.
Wimbush’s ability to be the public face of a company is unsurprising to people who have followed his career. From his freshman year at Notre Dame he landed big-company internships. Tim Zanni, former head of accounting firm KPMG’s technology practice, called Wimbush the most impressive intern he’d hired in 17 years. Wimbush also counts former NetApp vice chair Tom Mendoza, for whom Notre Dame’s business school is named, as a mentor and spent a summer at venture capital firm Accel Partners.
NCAA and college sports laws are changing
The law around amateur athletics is changing rapidly as courts and legislators expand athletes’ rights to be paid more of the estimated $8 billion in revenue it generates, dominated by football and basketball, said Florida attorney Darren Heitner. Heitner helped write the state’s law permitting athletes in the state to make endorsement deals and barring the NCAA from stopping them.
Congress and President Joe Biden are likely to have the final word on what the rules for the new world of college athletics will be, a stance Heitner said is favored by the NCAA, which would rather not face multiple state standards.
NCAA spokeswoman Stacey Osburn didn’t respond to e-mails seeking comment.
Seven federal bills have been introduced on the topic. Democrats led by Sens. Cory Booker of New Jersey and Richard Blumenthal of Connecticut have proposed a measure that would require half of adjusted revenue to be shared with athletes, an arrangement similar to collective bargaining agreements in the National Basketball Association. Sen. Roger Wicker, R-Miss., has proposed less-sweeping changes that exclude revenue sharing but would let athletes do endorsements and paid appearances.
An aide involved in the legislation said the two parties are working on a compromise to expand athletes’ compensation, commercial opportunities and health-care coverage but will likely stop short of revenue sharing. The aide declined to be named because the aide was not authorized to be an official source on the topic and did not want to disrupt the ongoing negotiations.
Capitol Hill’s push will likely make the NCAA propose its own changes, said John Heisler, senior associate athletic director at the University of Central Florida, where Wimbush, who spent his last year of eligibility playing for the Knights, is targeting current athletes.
“We all anticipate something coming from the NCAA soon,″ said Heisler, noting that many proposals to let athletes make off-the-field deals violate existing NCAA rules. UCF needs to know the final rules before it can evaluate proposals to partner with commercial entities that are interested or counsel athletes about how they should move forward, Heisler said.
How local markets become a big game
Seminole County’s Cunha has one idea, which he says illustrates how a platform like MOGL may work overtime.
He hopes to use local athletes to lure more tourists, in the immediate future from Hawaii, exploiting the fact that both UCF and Florida State expect to start quarterbacks from the Aloha State this fall. He noted there is a direct flight from Hawaii to Orlando, and Hawaiians tend to behave like international tourists who stay in town longer and spend more money than visitors from closer by.
Seminole County plans to sign an amateur athlete on July 1, though Cunha could not be more specific because he has not been allowed to have direct contact with the athlete — he is only allowed to speak with MOGL until the Florida law takes effect. The Supreme Court decision and any future changes from the NCAA are irrelevant to Florida, he said.
“I can see the NCAA wanting to slow play this, but we want to show that we support our athletes and this is a valuable market for us,” he said. “We can’t chase an athlete from the Orlando Magic. This is space we want to live in, the amateur athlete space.”
The NCAA is likely to take action ahead of July 1. The organization has had an NIL — or name, image, likeness — proposal that is ready for a vote since January, but that was delayed due to antitrust concerns. NCAA President Mark Emmert has said he wants the governing bodies in college sports to approve new rules before the state laws go into effect, a decision that could come during the next meeting of the council that oversees Division I sports on June 22-23.
The NCAA could also look to challenge the state rules in court. Other college sports executives, such as SEC Commissioner Greg Sankey, have called for Congress to set a standard that would override state laws.
Cunha said MOGL has a chance to end up like tech start-ups that build out a technology that bigger rivals don’t have, create a market that the big players always considered too small to serve with traditional business models, and ultimately become attractive M&A targets. He predicts MOGL will attract thousands of athletes to its platform, prove it can match athletes with small opportunities in bulk, and attract an offer from agency titans that now focus on making big deals for a relatively small number of elite athletes.
“With this innovation, I think they’ll get bought out within 24 months of the new [NCAA] rules,” Cunha said, naming agencies such as IMG and William Morris as potential suitors. “This will be an easy purchase for them.”
Syal and Wimbush stop short of that. Their two-year goal is to establish themselves as a business that high-school athletes think of as the place to help them begin brand-building while in college, operating nationwide as new laws allow it. To do that, they need to build ties with businesses and with the NCAA as well as athletes, Syal said.
“Our access to athletes at scale does make us an attractive acquisition target for a company looking to enter the collegiate space,” Syal said. But, he added, “what will be the most important over the next 24 months is achieving a critical mass of athletes and opportunities on the platform.”