Want to win big? NIL collectives must be ready to break bank in basketball transfer portal

In college football, $1 million in NIL capital can go a long way.

A starting quarterback. Two elite offensive tackles. Maybe even four wide receivers. The top donor-funded NIL collectives are spending eight figures annually to field rosters that can compete for a College Football Playoff berth.

But in college basketball, finances run differently. Budgets range from $1 to $4 million. Deals pushing half a million to seven figures are much more frequent in basketball, unlike football.

“Think about it,” an agent who negotiates collective deals for football and basketball players told On3. “You really just need to pay seven or eight guys in basketball. Truly, just need two studs in basketball to win. But in football, you can’t just pay good money to two or three guys.”

Before the college basketball transfer portal even opened, assistants were sending warnings to On3 about how silly the 45 days could be. The national championship will be played Monday night. Nearly 1,500 athletes have already entered the sport’s version of free agency.

The most valuable position in the basketball transfer portal – where most NIL dollars are used these days – are power forwards and centers. For high-end talent at those positions, $1 million deals are commonplace.

Even top guards are making roughly half a million a year. Speaking with sources over the last week, On3’s learned of a conference player of the year transfer earning $500,000. Another guard is set to make $450,000.

“It just doesn’t take as many players in basketball,” one collective operator told On3. “And one guy can truly change the game by himself, unlike football.”

Who will be big spenders in transfer portal?

As On3 reported last week, Louisville and Michigan are two schools to watch for Florida Atlantic transfer Johnell Davis. A March Madness hero a year ago, a source said the guard can command $1 million in the market right now because of the impact he can make. Helping a college basketball program get back to relevancy is imperative for bluebloods.

To put those dollars in perspective, quarterbacks are typically the highest-paid position in football. Nebraska coach Matt Rhule said in December that, “a good quarterback in the portal costs $1 million to $1.5 million to $2 million.”

But without an offensive line, a quarterback means nothing. That’s completely different in basketball, where someone like Davis can take over a game instantaneously. As one agent pointed out, however, some top players will take a pay cut if it means playing around talent that boosts draft stock.

“Supply and demand and the impact one player can have in their sport versus football,” added another NIL collective executive. “The price per player on average is close to double the football average.”

John Calipari’s move shows how key NIL is

Evidence of how important NIL now is in college basketball came Sunday night. Kentucky’s John Calipari is finalizing a five-year deal to become the next Arkansas basketball head coach. As part of the agreement, he is expected to have “at least” $5 million annually in NIL funds to work with. The same source estimated the budget will be in the $6 million ballpark. That will place the Razorbacks at the top of the sport, where typical Power 4 budgets range from $1 to $4 million.

Having the NIL capital to aggressively attack the portal and high school recruiting is becoming a key factor in coaching decisions in football and basketball. UConn and Purdue are two of the oldest teams in the sport. Both are playing for a national title on Monday night. There are plenty of veterans available in the portal.

For years, Nike and adidas ran college basketball. The sneaker giants poured dollars into the sport, paying coaches and rosters. With the rise of NIL and lucrative collective packages, they have taken a back seat. NIL has arguably created more parity in the sport. But just because adidas and Nike are gone doesn’t mean the expected amount of dollars has changed.

“It’s been happening for a long time,” an ACC collective leader said. “They’ve been getting this money forever, especially in basketball. This is just the norm, and it has something to do with the environment Nike and adidas created. You’re also dealing with more real agents than in football. Guys have no problem saying, ‘I know you have more money.”

Return on investment quicker in college basketball

Another agent who deals in football and basketball dealings believes the NFL and NBA models can be reflected in the college game. The NBA has a maximum salary while the NFL does not.

“There’s really no amount an NBA team could give a top-five player that would be an overpay, so they have to create the individual max to make sure money gets spread around,” the agent said.

How top boosters look in the space is crucial to understanding why larger contracts are more common in college basketball. The way top basketball players can impact a game is significantly more than a football player does.

Basketball is also more affordable. Creating a roster capable of competing for a conference championship and an NCAA Tournament run can be a quarter of how much a collective needs to field a football roster.

“Boosters can have their attention caught up in basketball madness,” the ACC operator said. “Donors love the intensity of the sport. They can create parity much more than they can in football. Like $2 million in football is just a quarter of the budget. In basketball, you can buy every position and watch them play every night. Forty games is a much better return on investment than 12 games in football.”