Changes let high school athletes bank big endorsement bucks
Nov 30, 2022, 4:10 AM | Updated: 5:12 pm
(AP Photo/Gregory Bull)
SAN DIEGO (AP) — Jada Williams was a social media star and a talented point guard when she moved with her mother from a Kansas City suburb to San Diego, looking to play basketball for a high school powerhouse and parlay her online prowess into endorsement deals.
She found it all in California, which has become the trendsetter among the 19 states that allow high school athletes to profit from their name, image and likeness without affecting their eligibility to play in college.
The 17-year-old Williams is now pulling in six figures a year from six major endorsement deals. The senior at La Jolla Country Day School has signed to play at the University of Arizona.
“It’s definitely a big change for me, but it was good in every single direction,” Williams said during a break from her exhaustive practice routine, which she often documents with videos and photos posted online. It was the right decision for school and basketball, “and on top of that I was able to start capitalizing off NIL,” shorthand for name, image and likeness.
The effort that began when former UCLA basketball star Ed O’Bannon took on the college sports establishment over NIL rules is quickly reshaping high school sports. Elite prep athletes are banking six and even seven figures before heading to college. The buzz extends to social media, where the top stars have millions of followers on Instagram, TikTok and Twitter, which in turn helps boost their NIL valuation.
“It’s getting bigger by the day,” said Michael Caspino, a Newport Beach attorney who became NIL savvy while reviewing deals for his son’s high school friends and pushing back against the ones that tried to take advantage of the athletes.
Three high school stars are at the top of On3.com’s NIL valuations, which include both college and high school players. They are Bronny James, the son of Lakers star LeBron James; Arch Manning, the third generation of the first family of quarterbacks; and Mikey Williams, a basketball star at San Ysidro High in San Diego.
James tops the list with a valuation of $7.5 million. He attends Sierra Canyon High in the Los Angeles area and recently signed a deal with Nike. Mikey Williams, who has committed to Memphis and has a multiyear deal with Puma, has a valuation of $3.6 million. Manning, who attends Isidore Newman High in New Orleans and has committed to Texas, is at $3.4 million.
The On3 NIL valuation, considered the industry standard, uses performance, influence and exposure data. While the algorithm includes data from deals, it does not act as a tracker of the value of NIL deals.
Jada Williams has a half-dozen deals, including with Spalding; Move Insoles, which was co-founded by NBA star Damian Lillard; Lemon Perfect, a bottled water company in which Beyonce is a major investor; and Gym Shark.
“My social media was already kind of big so I was just doing basically NIL without getting paid because it was illegal,” she said.
After being approached by a few large companies with NIL offers, the family discovered that the deals weren’t permitted in Missouri and that California was the only state that allowed it at the time.
“I realized wow, this is insane,” said Williams’ mother, Jill McIntyre. Jada Williams moved to San Diego with her mother and an older sister ahead of her junior year.
“She had to take advantage of the opportunity where she can literally invest in her future at 17,” said McIntyre, a regional sales manager for a tech company who helps her daughter manage her business affairs.
“We’re still young, but at the same time we’re learning about how to manage money and just learn a lot of life skills that are way bigger than just NIL,” said Williams, a two-time gold medalist with the U.S. junior national team who has incorporated as Jada Williams Inc. and plans to start a foundation.
Malachi Nelson, a senior quarterback at Los Alamitos High who has committed to USC, landed big deals even before signing with Klutch Sports, the agency that represents LeBron James. He’s 42nd on the top 100 with a valuation of $794,000, 10 spots ahead of UCLA quarterback Dorian Thompson-Robinson. Jada Williams is at No. 71, with a valuation of $550,000.
California was the first state to allow high school athletes to sign NIL deals. Southern California has always been a hotbed of prep talent. Athletes from other regions, like Williams, are moving to the Golden State to take advantage of NIL. Some transfer for just their senior season.
NIL has become such a big deal that a Los Alamitos High coach who helps players with recruiting also guides them through the new frontier.
“We’ve got guys on our team making a heck of a lot more money than I am this year,” Los Alamitos head coach Ray Fenton said. “All across the country, kids are getting paid a lot of money for deals they sign.”
Peter Schoenthal, an NIL expert who is CEO of Athliance in Fort Lauderdale, Florida, predicts that every state will allow high school athletes to take advantage of NIL within a year or so.
“We have 8-year-olds in this country and all over the world that have YouTube channels where they’re making millions of dollars reviewing toys,” Schoenthal said. “There’s no way to really stop an individual who has marketing ability to stop them from their right to publicity, whether or not they’re high school athletes, whether or not they’re big-time recruits.”
Schoenthal and Caspino help athletes avoid the downside of NIL, such as one-sided deals, and they offer assistance with understanding taxes and handling money.
“Most of the families I’ve worked with are very low on the economic totem pole in our society. For the first time, they’re able to have economic stability in their life,” said Caspino, whose son, Sam, is a freshman tight end at SMU.
Coaches, too, try to keep athletes from getting in trouble.
“You really have to be grounded as a family, because you have 18-year-old kids that all of a sudden walk into a lot of money, and they think it’s endless,” Fenton said. “It could be $10,000, and for a kid who’s never had $5 in his pocket in his whole life, that $10,000 is an incredible amount. What they don’t realize is $10,000 runs out, and it runs out pretty fast.”
Bruce Bible, the associate head coach at Los Alamitos, cautions against young athletes becoming “all about NIL.”
“The main thing has to be the main thing — academics and athletics. NIL is secondary,” he said. He also tries to “temper expectations” because not everyone is going to get an NIL deal.
Bible said Nelson, who has a deal with a Los Angeles-area hospitality group founded by a former USC walk-on, is a perfect example of what drives NIL.
“It’s not based on the school he’s going to. It’s based on him and what he’s doing in his career and how marketable he is,” Bible said.
“This is the wave of the future and it’s just going to get bigger and bigger,” he added. “Can you imagine LeBron James in high school nowadays, what that would look like?”
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