In Baton Rouge, Louisiana, a remarkable turn of events unfolded as quarterback recruit Bryce Underwood switched his commitment from LSU to Michigan. Amidst this upheaval, a private equity executive in San Francisco, Holden Spaht, received a plea for assistance from South Louisiana. Holden, a Harvard Business School graduate and Baton Rouge native, had been quietly working behind the scenes with a select few to support LSU football’s name, image, and likeness (NIL) initiatives.
Facing challenges like a string of losses, losing a top recruit, and lagging behind other SEC programs in NIL funding, LSU’s coach Brian Kelly and administrators launched a fundraising campaign to bolster the team’s roster and retain key players. In a rapid push to raise at least half of their ambitious $13 million NIL goal within two weeks, the program mobilized with a newfound intensity.
Despite past budget constraints, LSU’s fundraising efforts saw a remarkable transformation this winter. With strategic presentations and personal appeals, significant donations poured in, culminating in a surge of support. This financial boost enabled LSU to secure top transfers, keep key players, and recruit promising high school prospects, ensuring they remained competitive in the evolving landscape of college athletics.
As a new era of revenue-sharing approaches, LSU’s proactive approach and donor support have positioned them for success in navigating the changing dynamics of collegiate sports. The recent developments underscore the pivotal role of fundraising and strategic investments in shaping the future of college athletics.
Schools and booster collectives are rushing to distribute funds to athletes before the new revenue-sharing era begins in July, bringing stricter enforcement measures. Payments to athletes post-July 1 will be subject to scrutiny from a new enforcement entity, likely resulting in the rejection of many booster-supported deals seen in recent years.
To circumvent this, schools are frontloading athlete compensation, distributing funds before the deadline to avoid the new regulations and to maintain flexibility in the revenue-share pool. This strategy allows them to allocate funds before the new cap year starts in July 2025. Some programs are frontloading up to $16 million, with additional funds available for the 2026 season.
This frontloading trend is prevalent among power conference programs, with notable schools like LSU aiming to frontload over $13 million. However, this approach carries risks, as athletes may lack motivation during the season if they receive most of their payments upfront. Additionally, an inflated market may emerge in Year 2 of the revenue-sharing calendar, leading to potential discontent among athletes.
Looking ahead, uncertainties loom about the long-term impacts of frontloading and the sustainability of this approach in the evolving landscape of collegiate athletics.
In the image captured by Alex Slitz via Getty Images, LSU’s aspirations extend to being part of the national title conversation. At LSU’s newly refurbished football operations building, General Manager Austin Thomas sits at his desk, emphasizing the significance of the computer screen before him. This screen houses a software database system, a key tool developed in collaboration with athletic director Scott Woodward during their summer visits to NFL teams like the Seattle Seahawks.
This innovative system assigns monetary values to each position on LSU’s roster and to the players in those positions, be it a starter, rotational player, or backup. As Thomas inputs new values for one position, the values for all other positions adjust to ensure LSU remains within the revenue-share cap. For instance, if 15% of the funds are allocated to the quarterback position, the remaining positions cannot surpass 85%.
LSU implements a pay hierarchy based on factors such as experience and playing time. Thomas describes the system as compelling, emphasizing the importance of allocating capital to key positions like quarterback, cornerback, and defensive end. This structured approach guides decisions, such as letting go of players who exceed certain thresholds.
Thomas, a prominent figure in college football management, was appointed as LSU’s general manager in 2016 by Ed Orgeron. Renowned for his role in building LSU’s 2019 championship team, he has since made significant contributions to other programs, including Texas A&M and Ole Miss. His analytical expertise and fundraising efforts have been pivotal in LSU’s recent aggressive approach to Name, Image, and Likeness opportunities following Woodward’s appointment last January.
Transitioning from a talent evaluator to a strategic fundraiser, Thomas presented a comprehensive overview to top donors, showcasing the monetary value system and articulating the necessity of financial support for their initiatives. LSU’s proactive stance in the NIL landscape was underscored by comparisons to other programs, prompting donors to recognize the importance of their contributions in sustaining the program’s competitiveness.
As LSU continues to navigate the evolving college football landscape, Thomas and Woodward’s collaborative efforts exemplify a strategic approach to roster management and fundraising, positioning the program for sustained success.
The collective at LSU allocated $2 million to compensate players with similar low five-figure amounts, aiming to maintain team culture and unity. Head coach Kelly limited transfers to sustain the program. Despite the team’s recent record of 15-9 in power conference games, Kelly, who earns $10 million annually, emphasized building the team with high school talent to avoid constant rebuilding with transfers. The program faced financial constraints while pursuing transfers, prompting a fundraising initiative in December involving high-level donors. One of the donors, Holden Spaht, a successful private equity investor with a net worth of $3.7 billion, supported LSU football’s NIL efforts. Other prominent donors, like Todd Graves and Gordon McKernan, have also contributed significantly to the program. However, some donors, like McKernan, voiced concerns about the sustainability of such financial support.
The author discusses the potential challenges and opportunities for LSU in the context of the evolving landscape of NIL deals in college sports. While LSU may face obstacles due to the economic differences between Louisiana and states like Texas and Florida, there is optimism regarding the fundraising efforts through the Tiger Athletic Foundation. The foundation has been successful in generating significant donations for NIL deals, which could help LSU compete with schools in more financially robust regions.
LSU’s approach to recruiting and building its football team is also highlighted, with a focus on the transfer portal as a key resource for adding experienced players to the roster. The team aims to strike a balance between developing high school talent, retaining current players, and acquiring free agents from the portal. By prioritizing player retention and team stability, LSU hopes to achieve success on the field and in the competitive landscape of college football.
According to Thomas, success is not just about the amount of money one has, but rather how wisely that money is utilized. He describes it as an art, a combination of gut instincts, intuition, momentum, and data. Should the House settlement be approved this spring, Thomas and Kelly will have approximately $13.5 million at their disposal as of July 1, as explained by Woodward. LSU, like many other institutions, will distribute its revenue share pool of $20.5 million based on the House settlement’s specified formula: 75% to football ($13.5 million), 15% to men’s basketball ($2.7 million), 5% to women’s basketball ($900,000), and 5% to all other sports ($900,000).
The school plans to allocate a portion of new scholarships, totaling at least $2.5 million in additional aid. This amount will be subtracted from the revenue-sharing cap, reducing it to $18 million, which accounts for the specific amounts assigned to each sport. Woodward deliberates over the finer details, such as determining the allocation of the remaining 5% and balancing it with the teams’ ability to secure NIL deals.
The future of collectives operating under the revenue-sharing model remains uncertain, with some transitioning into marketing agencies facilitating third-party NIL deals for athletes to exceed the cap. Donations are emphasized as crucial for LSU’s athletic department, especially considering the projected budget deficit in the coming years, which is expected to grow due to built-in escalators in the revenue-share cap.
Despite the financial challenges, there is optimism and a strong desire for success. The pressure to win has heightened, with donors like Mosely expressing support for Brian Kelly and the investment made in the team. The objective is clear: to achieve success, defined by a playoff appearance, through strategic investments in resources, coaching staff, and overall team performance.
