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College sports fans hoping a particular athlete comes to their favorite school, or stays, now can help influence the athlete's decision by opening their wallets.
What once was taboo has gone mainstream with the recent launch of a crowdfunding platform called Fanstake.
“What we’re trying to do is create a free market,” Fanstake CEO Greg Glass said Tuesday. “We feel like the part that’s missing in NIL is the democratization of it, where the kids hopefully see their fair market value based on the demand and it makes it a little easier for your retail fan to participate where it’s no risk.”
Fanstake's concept is a variation of fans contributing to booster-backed collectives, which pool money and facilitate name, image and likeness deals that have allowed athletes to cash in on their celebrity since 2021. NIL money has grown into an important recruiting and retention tool in college athletics and will augment direct payments coming from schools sometime next year.
Fanstake invites individual or groups of fans to play a role in recruiting and retention by directing money to specific athletes.
Fans wanting to “stake an athlete," as Fanstake calls it, choose whether they want to pledge money for a recruit, potential transfer or an athlete currently on the roster.
A Nebraska fan, for example, could pledge $5, $10 or more to an athlete. If the athlete chooses Nebraska and wants to collect money that has been staked by an individual or group of fans, the athlete would be required to enter into an NIL agreement with Fanstake to satisfy NCAA rules. Glass said the NIL deals vary depending on amount of money involved, but all require the athletes to promote Fanstake in some fashion.
If the athlete ends up going to, say, Notre Dame instead of Nebraska, the Nebraska fans would get their money credited to their accounts and the Notre Dame fans would fund the endorsement deal. No NIL deal is made with an athlete until the athlete is on their school's roster, Glass said.
Glass said athletes keep at least 90% of the money and an additional 3% is distributed among teammates who also agree to promote Fanstake. The remaining money goes to Fanstake.
Fanstake has mostly used social media to advertise its platform, and Glass said over 5,000 fans have pledged a total of more than $20,000 since the November launch.
The only athletes up for bid initially are players in Division I football and men’s and women’s basketball, as well as the top high school prospects in each sport. Glass said Fanstake plans to add more sports along with athletes from lower divisions.
Fanstake this week announced Colorado five-star quarterback recruit Julian Lewis as its first brand ambassador. Lewis received an ownership stake in the company as part of his NIL deal.
Glass said a federal court decision in Tennessee last February barring the NCAA from enforcing its rules prohibiting NIL compensation for recruits cleared the way for Fanstake to open competitive bidding for athletes. The court found that the ban limited athletes' negotiation leverage and prevented them from understanding their true NIL value.
“We’ve reached the point, especially with the federal injunction, where the athletes have to be able to negotiate in advance of selecting a school and they need to understand what is the opportunity if I go to Nebraska versus if I go to Notre Dame," Glass said. “Fanstake is enabling that. We don’t actually engage into an NIL deal until they are at the school, but we allow the fan bases to help tell the athlete what the demand looks like and how much money potentially is there.”
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