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Nearly every day, you may be reading another story about college coaches (primarily football coaches) whining about needing more NIL (Name, Image, and Likeness) money to attract and keep their top players.
Let’s talk about one of those coaches today.
Oklahoma State’s long-time football coach Mike Gundy was a former college quarterback at Oklahoma State in the 1980’s. After graduating, Mike Gundy became a graduate assistant at OSU and spent several years on the coaching staff. After job promotions to Baylor and Maryland, Gundy returned to Okie State in 2001. He was named the school’s head football coach in 2005.
Prior to his return, OSU’s all-time football record was less than 50% wins. In his 17 years as the head coach, Mike Gundy’s teams have won nearly 68% of their games and have appeared in bowl games in all but one season.
His bio at the Oklahoma State University athletics website said, “He has spent more than half of his life either quarterbacking or coaching at Oklahoma State and is the head coach presiding over the era of greatest sustained success in the history of the program.”
Perhaps Mike Gundy actually does bleed orange and black!
Gundy was recruited to play football at Oklahoma State. Now, it is his job to recruit other talented student-athletes to come play football at OSU.
During Mike Gundy’s days as a player, a prized recruit may have received an (illegal) payment from an overzealous booster to attend the university in addition to a full scholarship with room and board paid.
Today, the NCAA’s transfer portal combined with the NIL Wild West Show has high school recruits and current college players seeking the best financial deals to play ball. This is in addition to receiving the value of an academic scholarship with free room and board.
My, how times have changed!
A few days ago, Coach Mike Gundy was asked about recruiting in today’s wacky new NIL environment. His observations were eye opening.
He said, “I’m going to hypothetically build a situation: If you brought in 50 of our players and said we’ll NIL you $50-$60,000 a year cash or we can build you a new weight room and meeting room, which one do you want? They’re gonna take [the money], right? That’s what kids do nowadays.”
He added, “Players used to want to go somewhere for shiny new facilities and new uniforms and things like that — they still want to go somewhere where they win, but they also want the other stuff.”
That means they are seeking some cash, too.
Coach Gundy knows that only one or two players on his team will make it into the NFL every season. The other players (though talented enough to have made it to the major college level) are trying to cash-in. They see the NIL opportunities as a way to earn money even if these players don’t play professionally.
So, how does a football coach like Mike Gundy advise the school’s NIL “godfathers” in charge of this growing pile of cash? Which recruit should be offered money? How much?
Did you know that the coach (wink, wink) is not supposed to be involved in this pay-for-players game? It would be foolish to think that the coaching staff and the guardians of the NIL money machine are not closely coordinating their efforts.
For major college football programs like Oklahoma State of the Big 12 Conference, the chances of raising significant dollars for redistribution to recruits and transfer players is easier than for many other conferences and individual programs.
Because it’s all about the money (of course).
In 2022, Oklahoma State ranked #37 in average home attendance (54,735/game) of the more than 130 major college (FBS) football programs. The Cowboys’ conference (the Big 12) averaged nearly 59,000 fans per home game last season. Only the Big Ten (65,683) and SEC (76,590) had a higher average home football attendance in 2022.
Coming in at #4 was the ACC (47,677) and Pac-12 Conference (44,103) finished fifth.
Since 1972, every college football national champion has come from one of those five major conferences.
In case you were wondering, the American (28,686 fans/game) were in sixth place. The Mountain West (22,496), Sunbelt (19,836), Conference USA (18,228), and Mid-American Conference (14,224) have a numbers problem. With lackluster fan support, those teams’ athletics budgets for facilities, coaches, and (of course) NIL money to lure (supposedly) better players to their programs lags the financial resources of the big boys.
It’s time to dive into the numbers!
First, let’s compare #37 Oklahoma State University of the Big 12 with the Sunbelt’s University of Louisiana at Monroe (ranked #123). Financially speaking, Oklahoma State’s athletic budget in 2022 was more than $104 million.
The Cowboys received nearly 49% of their annual revenue from television/media rights. Donors kicked-in another 19% of the money while ticket sales generated just 12%. Institutional/government support at Oklahoma State was shown at 12% of the athletic budget.
How does that contrast with the Warhawks of UL-Monroe?
In 2022, ULM took in just $19 million in total revenues (all sports). Only 14% of the Warhawks’ revenue came from television/media rights. Athletic donors gave just 7% while only 3% of revenue was generated by ticket sales. An amazing 52% of ULM’s athletic revenue was derived from “institution/government support”.
If you thought Oklahoma State’s athletics budget was big, let’s travel to Baton Rouge and take a closer look at LSU of the Southeastern Conference.
The Bayou Bengals’ total athletics revenue last year was nearly $200 million. LSU’s largest component was their enthusiastic donors (38%) followed by television/media rights (31%) and ticket sales (23%). The Tigers were shown as receiving zero (or close to it) in institutional/government support in 2022.
Let’s summarize those annual revenue numbers:
LSU $200 million/year
OSU $104 million/year
ULM $ 19 million/year
LSU’s athletic revenues were significantly greater than both Oklahoma State and UL-Monroe combined.
The numbers don’t lie. The largest five conferences (SEC, Big Ten, Big 12, ACC, and Pac-12) will generate the greatest amount of athletic revenue every year.
If athlete/students (my new phrase for today’s pay-for-players) are marketing their athletic prowess and shopping for the best NIL deal, they will gravitate toward one of the top five conferences.
Many of the so-called five star high school athletes will fail to live-up to their own hype once they get to college. The NIL money handed to those former high school stars will quickly dry-up if they spend a year or more on the bench of Big School U.
That’s why the NCAA’s transfer portal has become a popular monetary matchmaker for so many athlete/students over the past few years.
An increasing number of underutilized former high school stars as well as high performing underclassmen are putting their hands-up to enter the NCAA’s transfer portal and seek more money to flip to another school.
This new process has become a very ugly business for everyone except for some athlete/students who are getting schools to bid against one another.
As Oklahoma State University football coach Mike Gundy said, most of today’s players will grab the money rather than remain happy playing for a college with newer athletic facilities and a top-notch academic reputation.
Yes, this is the essence of capitalism.
In contrast, there are still a few high school students who are so highly coveted for their academic abilities and outstanding test scores that they might receive more than one college scholarship offer, too.
Though our high school valedictorian won’t generate millions of dollars in revenues for the college of their choice (yet), this very bright straight “A” student must settle for only a full academic scholarship, room, and board. Not too shabby!
Let’s say that the same high school produces a highly recruited quarterback with a “C” grade point average. If the college football coach and his NIL financiers believe that this freshman quarterback can help to keep 90,000 fans paying $75 per game for their season tickets, the young man may test his negotiation skills and grab some significant NIL cash in addition to the same full scholarship which was offered to his own high school’s valedictorian.
Welcome to Coach Mike Gundy’s world!