A new company is offering college athletes upfront cash in exchange for a portion of their name, image and likeness deals, an arrangement some consumer protection experts and financial advisers say could prey on young athletes.
Why would it be a “nominal” fee? The deal I saw was for $50,000 up front in exchange for 25% of NIL earnings capped at $125,000. If the company is exploiting stupid high schoolers, that’s bad, but I assume they’re doing deals with people who are represented by lawyers and managers and are capable of looking after their own interests and acting rationally.
No I don’t. The kid gets money he otherwise wouldn’t get right away. There is cap on how much he has to share so if he ends up being a super stud he will be fine. If he ends up sucking he will be fine.
I mean there a difference between being fine and losing money that would otherwise rightfully be yours at a cut that would surpass agents fees. If Nilly goes after longshots it could be one thing but this feels like they are gonna go after P4 guys who’s families are struggling
If your family is struggling and you have one super risky asset that might be worth millions or zero, it’s a really good idea to sell a portion of that asset for cash. It’s a very good thing that there are companies that will buy portions of that asset from you. Otherwise you’re basically gambling life-changing money on your health and athletic performance.
In that certain scenario it would be good, that’s ignoring the other scenarios in which you would lose money that would otherwise be yours. People keep acting like it’s either bust or mega millions
Imagine someone offers you a deal where you can either get a million dollars guaranteed or you can flip a coin and if you win you get $2,000,001.
Most people would take the guaranteed money, even though the coin flip is technically more valuable. In other words, people will give up some money in exchange for having less risk. There’s nothing wrong with that – it can actually be smart, depending on your situation.
The coin flip example is obvious because it’s a lot of risk for very little money. But the same concept can sometimes apply even when it’s a pretty good chunk of money for a fairly small amount of risk.
And sometimes it’s a good idea to take out a loan because you need money right now, even if you’ll have to pay back more than you took out later. You’re not getting scammed when you buy a house just because you pay back more than you got from the mortgage company.
If you’re providing money for them up front, no not at all. A lot of these kids come from extreme poverty. This allows them to support their families before turning professional while signing over a percentage of their future earnings. If the kids completely crash and burn, they still don’t have to pay the up front cost back to them. There is truly nothing wrong with that and it’s not even a new concept.
It’s so funny to me how casually you’re describing predatory behavior. You yourself are describing a person in a position of power using their influence to gain control over someone “coming from extreme poverty”. If you can’t figure out why that’s problematic, you’ve gone off the deep end.
people in extreme poverty need money today not maybe in 3/5 years. Trading cash up front for a percentage of future NIL earnings is a good deal for people with those circumstances. Of course Perk is in it to make money but that doesn’t change the fact that he is giving money to families that need it. Hes investing in an athletes future earning potential, but once again this is not a new practice. It’s been happening for decades in other sports.
This is pretty common in MLB and has been for a while now.
Isn’t that different because minor leaguers are making a salary and high school basketball players aren’t?
They can make NIL money tho, it’s a percentage of that future income that he’s taking. I don’t see the problem
You don’t see the issue in high schoolers signing their likeness rights away for a nominal fee?
Why would it be a “nominal” fee? The deal I saw was for $50,000 up front in exchange for 25% of NIL earnings capped at $125,000. If the company is exploiting stupid high schoolers, that’s bad, but I assume they’re doing deals with people who are represented by lawyers and managers and are capable of looking after their own interests and acting rationally.
being an extra in a movie is technically signing your likeness rights away for a nominal fee.
No I don’t. The kid gets money he otherwise wouldn’t get right away. There is cap on how much he has to share so if he ends up being a super stud he will be fine. If he ends up sucking he will be fine.
I mean there a difference between being fine and losing money that would otherwise rightfully be yours at a cut that would surpass agents fees. If Nilly goes after longshots it could be one thing but this feels like they are gonna go after P4 guys who’s families are struggling
If your family is struggling and you have one super risky asset that might be worth millions or zero, it’s a really good idea to sell a portion of that asset for cash. It’s a very good thing that there are companies that will buy portions of that asset from you. Otherwise you’re basically gambling life-changing money on your health and athletic performance.
In that certain scenario it would be good, that’s ignoring the other scenarios in which you would lose money that would otherwise be yours. People keep acting like it’s either bust or mega millions
Imagine someone offers you a deal where you can either get a million dollars guaranteed or you can flip a coin and if you win you get $2,000,001.
Most people would take the guaranteed money, even though the coin flip is technically more valuable. In other words, people will give up some money in exchange for having less risk. There’s nothing wrong with that – it can actually be smart, depending on your situation.
The coin flip example is obvious because it’s a lot of risk for very little money. But the same concept can sometimes apply even when it’s a pretty good chunk of money for a fairly small amount of risk.
And sometimes it’s a good idea to take out a loan because you need money right now, even if you’ll have to pay back more than you took out later. You’re not getting scammed when you buy a house just because you pay back more than you got from the mortgage company.
Thank you - it makes no sense to give them a cut that doubles their investment out of your pocket. And then you still pay taxes etc.
And with an agent they don’t own you likeness lol. It’s so weird. Why wouldn’t he just start an agency?
It makes a lot of sense because you’ll probably come out ahead with a 50k upfront payment unless your NIL earnings are above 110k.
The amount that they take also caps at 125k so it’s not going to prevent you from earning tons of cash if you’re a superstar.
It’s basically just insurance, which I guess most redditors consider to be a scam, but not normal humans.
Plus the total amount he can make as well as the years is capped. He’s not signing kids to lifetime deals.
If you’re providing money for them up front, no not at all. A lot of these kids come from extreme poverty. This allows them to support their families before turning professional while signing over a percentage of their future earnings. If the kids completely crash and burn, they still don’t have to pay the up front cost back to them. There is truly nothing wrong with that and it’s not even a new concept.
It’s so funny to me how casually you’re describing predatory behavior. You yourself are describing a person in a position of power using their influence to gain control over someone “coming from extreme poverty”. If you can’t figure out why that’s problematic, you’ve gone off the deep end.
people in extreme poverty need money today not maybe in 3/5 years. Trading cash up front for a percentage of future NIL earnings is a good deal for people with those circumstances. Of course Perk is in it to make money but that doesn’t change the fact that he is giving money to families that need it. Hes investing in an athletes future earning potential, but once again this is not a new practice. It’s been happening for decades in other sports.