NIL crowd-sourced cash machine creates complex issues, solutions, questions

The new age of college athletics is full of new and, sometimes, uncomfortable feelings.

We’re still retraining our brains from what we always understood as amateurism — which became a fraudulent concept with each passing year — to this new and more equitable financial model.

With that comes a whole new economy, vocabulary and general processes from what was to what is.

That’s what made one particular PR email so interesting. It began a thought process that ranged the full spectrum from old-model outrage to more of a middle ground when considering the full context of a new start-up in the complex and confusing NIL world.

It’s not uncommon for reporters to get these inbox pitches, and they almost always go in the junk folder. They’re typically ignored, mostly because they’re seeking what amounts to free advertising, but this one felt like it needed a more comprehensive look.

This was from an outfit known as Fanstake, a website launched in late November that’s essentially a crowdfunded recruiting enticement.

Using something of a GoFundMe model, fans can donate to a recruit/transfer/returning player’s fund for whichever school you may support. You want a star quarterback to come to your school? Drop a few bucks into the pool and if he signs, enrolls and straps on the helmet, they can unlock those funds in the name of NIL.

A quick spin of their site drew a flood of reactions — a whiplash between bright idea and what the heck?

As someone who’s always supported the idea of NIL and the athletes getting their piece of the pie, it was intriguing.

Fanstake says that once all the requirements are met, athletes will receive at least 90% of the money raised by fans. The company takes 6.99% of converted transactions while 3% goes to teammates and/or non-profits, the site’s FAQ reads.

Any money pledged for athletes who end up elsewhere is returned to the user. The site also requires the athlete to sign and enroll and be on the roster so the payment won’t come until the season begins.

Five-star basketball prospect Nate Ament is among the big names whose recruitment is generating financial interest. The No. 4 player in 247Sports rating has in the neighborhood of $80,000 in the pot from the top-10 schools. Louisville fans have ponied up the most at north of $36,000 followed by Kentucky’s $25,870. Alabama fans have pledged the fourth most at $4,325. The largest single pledge to date is $2,400 from a Texas fan using the handle “HookEM.”

Should Ament sign with Louisville and join the team, his 90% stake would be in the $32,000 range. All the other money pledged would go back to the users who made their bid.

Part of what makes this so jarring to our old sensibilities is how out in the open this process appears.

Where we were once hunting down bagmen in the shadows of black market transactions, this is right here for everyone to see on the information superhighway.

That’s actually part of the strategy as the site promotes its transparency as its selling point, CEO and co-founder Greg Glass said in an interview with AL.com.

You can throw money at recruits (high school or transfer) or to protect a given roster and keep current players from looking elsewhere.

None of this would be possible without court rulings that, at least for now, tossed NCAA recruiting rules that banned the bedrock principle of paying to play.

And while the last two national championship college football teams won more through retaining their veteran talent via NIL deals, the sexy side of this concept is more about attracting new talent.

That’s where this can get troubling.

There are profiles on the Fanstake site for full rosters of players. That includes those who have entered the transfer portal and those who haven’t. An open call for tampering for anyone with a bag to drop.

What say you, CEO Glass?

“The reality of the situation as it stands today is because it’s not a free market,” Glass said. “The athletes actually benefit financially by putting their name in the portal because it brings the competition. Now there is more demand and versus just ‘All right, I’m gonna stay here.’ Well, you’re not maximizing just the tenets of capitalism.”

It’s both true and troublesome.

You can’t hold the old model of college athletics up to the core values of American capitalism and say it meshed. In no other realm would it have survived as long as it did because it became a culture and those who got rich also held all the power.

That balance of power is shifting away from the boardrooms and toward the ballfields.

But it also begs a larger question.

With that pendulum swinging so violently, at what point does the unchecked free market begin to consume the underlying product?

What is the breaking point for the consumers that keep this ecosystem flush with cash?

Signs of frustration are out there, at least anecdotally, from fans feeling nickel and dimed as prices go up on tickets and fan experiences to support revenue sharing at the same time rosters are as fluid as ever.

It becomes harder to gain an attachment to a star player knowing they can be lured away by the promise of a payday elsewhere.

This site is still new and will have a hard time generating the kind of cash needed to snatch a happy member of one roster to join the highest bidder on another.

But it’s seeing that concept as part of the marketing, so shamelessly front and center is jarring.

Fanstake is a volume play for what the political world calls the small-dollar donors. The site has venture capital backing the efforts, but like anything in this environment, is subject to unpredictable headwinds, legal actions and/or legislation.

It’s part of this new fabric that’s weaving an evolving and complex economy that now involves labor, not just management.

Who knows if it will work, but it creates another touchpoint or thought exercise within this whole process of understanding where we’re headed, asking questions about an unregulated environment while balancing rights and the greater good.

You know, the simple stuff about the future of the entirety of college sports.

Michael Casagrande is a reporter for the Alabama Media Group. Follow him on Twitter @ByCasagrande or on Facebook.