July 1, 2022, marked the one-year anniversary of college athletes being allowed to generate revenue for themselves from the use of their names, images and likenesses (NILs). On this date, there were over 120 known NIL collectives that were creating NIL opportunities for college athletes. Today, this number has climbed to about 200–but what exactly are NIL collectives, and how do they operate?

What's a Collective?

NIL collectives are essentially ways for donors to pool together money in order to pay college athletes for their NILs. The collectives generate NIL deals for athletes at the school that it supports, but is still its own independent entity separate from the school. These collectives are usually created by alumni or other supporters of a school who have the necessary capital to start them. 

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Most collectives are referred to as donor-driven collectives. These collectives take the donated money from boosters and businesses and then help facilitate NIL deals between them and the athletes, resulting in the athletes being paid the donated money for the use of their NILs. Another form of collective is the marketplace collective. These attempt to create a place for athletes and businesses and boosters to meet to develop their own NIL deals. The money donated to these collectives is used to help facilitate these meetings. Finally, there are dual collectives, which perform the functions of both donor-driven and marketplace collectives. Other forms of collectives are beginning to be formed as well, but these three are the most common. 

Some collectives are applying to become 501(c)(3) non-profit organizations, which means that donations made to those collectives are tax-deductible. Other collectives are attempting to become 501(c)(7) tax-exempt entities as well. 

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What Purpose Do Collectives Serve?

Athletes are signing NIL deals through collectives that utilize their NILs in a variety of different ways. These include anything from signing autographs, appearing at events or in commercials, posting sponsored social media content and more. It's worth noting that a key purpose behind these collectives is to make schools attractive for college athletes in hopes that they will choose to attend them and remain in attendance for as long as possible. 

The majority of larger schools in terms of athletic notoriety across the country already have at least one NIL collective. This includes at least 92% of Power 5 schools and all 14 schools in the SEC. Many of the largest and most well known schools have multiple collectives, such as the University of Texas at Austin. Other major universities with collectives include schools like Clemson, Ohio State and Michigan. To get an idea of the magnitude of how much these collectives are looking to raise, experts are predicting that Power 5 collectives are attempting to generate at least $50,000 per football player per season. 

Related: Rate the University of Texas-Austin, Clemson University, Ohio State University, the University of Michigan

As if the new NIL rules didn't shake up college athletics enough, NIL collectives have come in and blurred the lines even more. There is no doubt that the NCAA will continue to keep a close watch over these collectives to ensure that no illegal payments are being made and no pay-for-play deals are being struck. 

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* Originally published on April 28, 2023, by Owen Roche