As NCAA evaluates future, Opendorse launches program for colleges to make NIL payments

With permissive school-to-athlete NIL pay potentially just five months away, service providers are taking notice of the coming change to the college sports landscape.

NCAA President Charlie Baker first brought up his Project D-I proposal in a memo to membership in December. The potential changes laid out included creating a subdivision of Division I that affords them more freedom to craft their policies and enables them to compensate athletes in innovative and consequential ways.

Since that initial memo was released, Power 4 leaders have pushed back on parts of the proposal. But one aspect that has found support is the permissive pay to athletes from institutions. The NCAA Division I Council is expected to discuss aspects of the format at its April meeting and could be adopted as soon as August.

With that in mind, NIL marketplace Opendorse is announcing the formation of “Opendorse Payments” on Tuesday. The software will allow college partners to manage NIL contracts, send NIL deals by scheduling recurring payouts, track completed activities and offer consolidated reporting to the NCAA once rules allow.

The technology is similar to what NIL collectives have been using for the last 30 months. Opendorse co-founder and CEO Blake Lawrence said the technology is something institutions have been asking about in recent months.

“Charlie Baker’s proposal has had an impact on accelerating allowing institutions to start to think about how they will participate more in NIL,” Lawrence told On3 earlier this week. “There’s also been a movement of schools who are starting to always think about how they can be more involved with NIL. And so giving the school themselves the same tools that are used by brands and collectives and their athletes already used to receive payments is just natural.”

College sports heading toward professionalized model

The NCAA has struggled to govern the NIL space as it now faces mounting legal challenges. On top of the National Labor Relations Board regional director’s decision to deem Dartmouth men’s basketball players as employees, a subset of athletes could be classified as employees of USC, the Pac-12 and/or the NCAA in an NLRB hearing in Los Angeles.

Congress has not shown any interest in assisting the NCAA, despite repeated efforts. The NCAA and power conferences could also owe thousands of athletes some $4.2 billion in retroactive NIL pay and broadcast revenue depending on the outcome of the House v. NCAA lawsuit.

Another key case to watch is Johnson v. NCAA, with former Division I athletes asking that athletes be deemed employees subject to the Fair Labor Standards Act. That requires covered employees to be paid minimum wage and overtime pay, much like non-athletes at colleges who participate in work-study programs.

With the mounting pressures, revenue sharing and employment models are not far off. Allowing schools to pay athletes NIL dollars under NCAA rules could be a step to combat the legal forces. According to Lawrence, Opendorse Payments would create a platform for centralized NIL compensation between athletes and schools.

This rollout from Opendorse comes as the NCAA has started its request for proposal process for its agent registry, disclosure database and education program.

“I would say that the role we play beyond a technology partner is just an NIL partner for colleges across the country,” Lawrence said. “So they lean on us to help provide them a vision of the future. In many of those conversations, the question is if the school can participate, then can they use the same tools that others in the market are using? The answer to that is yes, and that’s what Opendorse Payments is built to do.”