Ever since the House vs. NCAA ruling in March, things have been in motion for collegiate sports to adopt a revenue-sharing model to pay their athletes. As 2024 is wrapping up, the present and next month are sure to be full of anticipation. The elephant in the room being: when the official approval for revenue sharing will happen.

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Navigating the potential that comes with revenue share will be a brand new challenge for everyone. A revenue-sharing model in collegiate sports will bring its own share of opportunity – and uncertainty – from top to bottom. And the timer is counting down on how long administrators have to figure out how to pay their players properly, fairly, and safely.

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In this article:‍

What would a revenue-sharing model in college sports look like for schools and their athletes?

What could happen when revenue share officially kicks in?

What can administrators do to support their players before rev-share hits?

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What would a revenue-sharing model look like for schools and their athletes?

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Once revenue share is approved, institutions will receive a budget of slightly over $20 million per year that will be split by their discretion to use on their athletes. 

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To prepare for revenue-sharing in collegiate athletics, school administrators will have to be more strategic about how they’ll allocate their budgets and pay their players.

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Sounds… complicated.

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In some ways, it is. It goes without saying that adopting a revenue-sharing model will affect incoming and current athletes. It will require decisive planning from teams and administrators for athletes to feel taken care of, whether they’ve been on the roster or are just starting their collegiate career.

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Just this year, we’ve seen how the House vs. NCAA case made dual-revenue streams possible for athletes and how they may be paid for NIL deals. But revenue-sharing brings another set of questions to the forefront: what’s next with revenue sharing? How will it affect athletes, or a whole program’s budget and prospective revenue? How will schools balance these very new developments without dropping the ball?

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The ball is in the court (literally.)

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The kicker is: no one has the exact timing on when revenue sharing will be approved by. Which complicates things a little more for administrators.

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Scout’s CEO, Michael Haddix Jr., weighs in. “At this moment, schools are thinking, ‘how do you manage all these moving pieces and continue to run an athletic department, be competitive, and also be aware of the cost – and be ready to do it all once it’s officially approved?’”

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One thing is for certain: there’s no time to lose. The seasons won’t be waiting for schools to figure out their next move. As a former forward for the Siena Saints, Haddix Jr. knows a thing or two about how unrelenting the collegiate seasons are. 

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“Regardless of the final decision, all these sports are locked into a specific time every year. The courts aren’t.”

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“Revenue share is getting sorted out, but schools can’t be waiting for the final word of the settlement while the seasons are starting up so soon.”

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What could happen when revenue share officially kicks in?

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It’s anyone’s game as to what the final decision will bring. It’s also why planning accordingly is paramount – administrators can’t be caught off-guard when revenue-sharing is intrinsically tied to their athletes’ wellbeing and financial health.

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Haddix Jr. predicts some of the adjustments that schools may need to be prepared to make.

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1. Schools will continue recruiting, but must not deprioritize their current athletes.

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“Everybody's looking for the future,but you still have things going on now,” Haddix Jr. emphasizes.

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He advises schools to stay in the present, which includes focusing on recruiting and retention efforts.

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“You have to still be recruiting. You have to still be preparing for next year, and you should be making sure you can make the right offers to the right players. You have to keep asking yourself, are you investing in your players? Are you able to keep your players? Will you recruit better players?” 

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Alongside recruiting, Haddix Jr. urges schools to continue remaining active in supporting their existing teams and athletes. “Recruiting can take a big chunk out of the budget, but you still have athletes that need to be paid at present. They need to get their taxes done, and educated on all the financial stuff, sooner than later.”

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“It’ll be even more important that athletes understand what this will mean for them and their longterm financial health.”

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2. Athletes may face heightened financial challenges that will require more tailored guidance provided by administration.

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Since the election, there is more restlessness among collegiate sports surrounding athletes’ employment category. “I think with the election, what we'll see is a reduced chance of players becoming employees. With the National Labor Relations Board and the new president, it’s going to be a much slower pace for these players to turn into employees versus contractors.”

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“In 2025, more athletes will be paid as 10-99’s. They’ll need to know how to approach taxes and NIL deals,” Haddix Jr. says.

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“Education and execution shouldn’t be on the backburner any longer for schools in supporting their athletes.”

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3. Schools will need to consider Title IX now more than ever, especially in how they pay players.

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Title IX will continue to be an important factor in recruiting and retaining athletes.However, as we head into a new presidency, Haddix Jr. cautions administrators on neglecting Title IX in favor of only focusing on solely revenue – though the latter will now play a large part.

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“Revenue projections may affect how programs adhere to Title IX. There will be more factors that include revenue than just meeting a 50-50 split of players. Schools need to be careful of how revenue-sharing will affect pay to all of their athletes.”

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4. Administrators will need to invest in athlete development as part of their new budget

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Haddix Jr. suggests that administrators pay extra careful attention to how they invest in the development of their athletes, current and incoming. “College sports as a whole must avoid looking at everything as an upfront cost. There's an ROI component to this and making sure your players and your teams have a shot to succeed.”

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“A lot of times, schools may look at their budget and say, ‘we can’t afford to do it this way or that way.’ But with the new landscape of college athletics, we’re now recognizing that the cost today could result in differentiation tomorrow,” Haddix explains.

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Donors can also influence a great deal of NIL opportunities, directly affecting how players can earn not just during a season, but throughout their entire careers.

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“For programs to excel, there needs to be a self-sufficient process that begins with investment in the athletes. From that initial investment, those athletes can get more media deals and opportunities, leading to more revenue.”

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“It’s especially important that player development and experience needs be boosted with this new infusion of cash.”

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5. Safety concerns around payment and compliance will require paramount priority.

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“Questions of how to efficiently and safely distribute funds are definitely at the forefront of the mindshare of administration,” Haddix Jr. adds. “Payment won’t just be coming from collectives anymore. Payment through an institution needs to be immediate, and it needs to be safe.” 

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Privacy concerns will become more pertinent in the coming months as players gear up for the seasons. The last thing an athlete wants to experience is for their payment to arrive improperly, or not at all. “You want to avoid delays as much as possible. There needs to be security, infrastructure, and transparency when you're dealing with upward of $20,000,000 or so a year. And a lot of that is federal funds.”

NIL deals in collegiate sports increased by 146% in 2023, adding to the urgency for security as soon as possible. It’s imperative that administrators handle compliance and payment with sensitivity as more revenue streams for athletes rise alongside revenue-sharing.

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“There's a gravity to this where it needs to be really thoughtful on how it's done.”

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What can administrators do to support their players before rev-share hits?

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Much like how active rest is beneficial during a workout, administrators need to keep things moving, especially as their athletes are preparing for the seasons. While college sports waits for the final call on rev-share, Haddix Jr. provides a few immediate action items that schools can jump onto right now.

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1. Administrators can help their players get a head start on their taxes.

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“From a player's side: make sure your taxes are in order.” 

“Taxes come April 15th, but there are some things that these players can be doing before the end of the year, like gathering all their forms, establishing SEP IRAs or solo 401K’s, and filing ahead of the deadline.”

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2. Be thoughtful about the partner you choose.

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“Do your due diligence and find a partner who is an expert at what they do and has safety rails that align to the gravity of this situation, of your athletes’ wellbeing and futures. There’s no need to rush into it, but you want to make sure you’re choosing a partner that will provide you and your players with long term solutions.”

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“Administration must make sure they’re putting all the tools and foundation in place.”

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3. Find a trusted partner to support your athletes together.

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“You and your roster don't have to go at this alone. Your partner shouldn't just be a tool you plug in. It shouldn't just be an app you or your players download and never look at again. A reliable partner will provide you with valuable expertise, guidance, and knowledge of payments and compliance.”

“Find someone who is a knowledgeable partner, and not just a transactional one.”

Haddix Jr. shares how expert guidance and a solid team makes a world of a difference for both administrators and athletes. “A partner should be someone that you can call, and say, ‘let's strategically think about cash flow management, let’s talk about how I can better manage payment schedules.’ That also applies to the athletes and how they can grow their wealth, plan their lives, and keep rising.”

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About Scout

Scout is a financial coaching platform that provides student-athletes with the knowledge and tools to facilitate personal financial success — from investing and saving to budgeting and tax planning. We work with individual athletes, college teams, and athletic programs to empower and protect students in the changing NIL landscape. Black-led and with a deep commitment to diversity, equity and inclusion, Scout is intentional about welcoming, educating, and guiding those from under-resourced and marginalized communities.

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Investment advisory services--which are not FDIC insured--are provided by ELV8 Inc. (“Scout”), an SEC-registered investment adviser, and financial planning tools are provided by ELV8 Inc. (“Scout”). Tax planning tools offered through ELV8 Inc. (“Scout”) via partnership with April tax planning software.