OneTeam, Fanatics building major college group licensing business, but ‘nobody is getting rich off jerseys’

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When name, image and likeness took effect in July 2021, jersey sales were expected to be a primary source of income for college athletes. But there wasn't a structure in place to help facilitate a jersey program, the way the NFL Players Association or other unions handle that for pro athletes.

College athletes simply didn't have the wherewithal to organize their commercial rights. That meant it would require a third party to put that structure in place. It wouldn't be easy. Any company looking to organize the decentralized world of college athletics in the NIL era had to be prepared for "hand-to-hand combat," one college insider said. "It's a heavy lift."

Why? Because there are thousands of college athletes and there's not a single mechanism through which to reach all of them at once. Not only that, but the transfer portal has led to rampant player movement from school to school, which further complicates the process. Every time an athlete transfers, they must register a new group licensing agreement. Last year, that accounted for more than 3,000 athletes.

The college space, because of its sheer number of schools, teams and athletes, could yield a lot of business opportunities for the company that can scale it. But in order to sign the top college athletes to a group licensing deal that would underpin something like a jersey program, an agency would have to patiently go school to school to aggregate those player rights.

So, that's what OneTeam Partners, a specialist in group licensing, spent most of 2022 doing. February will mark one year since OneTeam partnered with Fanatics to launch a college jersey program that would rival the model and structure that has been commonly used by the pro players associations for the past 50 years.

During the past year, OneTeam has signed more than 8,000 college athletes to group licensing agreements, including 4,500 football players, 1,000 women's soccer athletes and 700 women's volleyball athletes across 80 schools.

Fanatics for the first time is offering Nike, Adidas and Under Armour football jerseys with actual player names and numbers. Previously, consumers had to use their own names. The football players in the program represent 42 schools — essentially the 42 best-selling schools in the Fanatics portfolio of partnerships.

In the coming months, it will grow even more. OneTeam and Fanatics will expand their program to include jerseys from the spring season sports, including baseball, softball and lacrosse.

"It's important to point out that this program is not just benefiting football and basketball players," said Malaika Underwood, OneTeam's interim CEO. "This has really opened the doors for us to provide an inclusive program across a bunch of sports, men and women. And we’re just getting started."

That expansion will drive growth in the jersey program to tens of thousands of athletes with licensed product on Fanatics and Barnes & Noble College e-commerce sites. OneTeam has already signed up 550 women's basketball players and 540 men's basketball participants from 94 schools this winter.

Athletes use their Compass NIL app to opt into the program, and Compass aggregates the opt-ins for group licensing deals, such as jerseys, trading cards and video games, or any other co-branded opportunities. Compass is a platform created by CLC to perform this kind of task and track sales.

The products within the jersey realm range from T-shirts and fleeces starting in the $30 to $40 price points to higher-end more authentic jerseys at $139.

OneTeam Partners takes 30% for its role in facilitating these deals. Each school negotiates its own royalty, while the athletes’ royalty is 4% of sales. The royalty rates for college athletes are the same, just as they are in group licensing for the professional athletes.

After one football season, the best-selling jerseys have belonged to Alabama quarterback Bryce Young, Texas running back Bijan Robinson, Tennessee quarterback Hendon Hooker and Southern California quarterback Caleb Williams, the Heisman Trophy winner.

"OneTeam did a spectacular job building the most scalable group licensing rights platform in the college business," said Derek Eiler, executive vice president, Fanatics College. "As a result, NIL has become a new, fast-growing category for Fanatics, and it has really helped drive football jersey sales for the top schools."

Still, "nobody's getting rich off jersey sales," one insider said.

Right now, jersey programs are as much about recruiting and providing a service to the schools as they are about generating revenue. "It's a daunting task because of the scale in college," said Underwood, a former volleyball athlete at North Carolina. "We’ve proven that we can drive commercial value through group licensing, but we have quite a bit left to accomplish."

There will be inherent challenges in the college space. There's relatively little demand for basketball jerseys, so most of the focus rests on developing a fickle marketplace for football jerseys. There are practically no Tom Bradys or Patrick Mahomes in the college space who can deliver an almost guaranteed amount of sales.

Going into the 2021 season, three of the most-hyped players would have been J.T. Daniels at Georgia, Spencer Rattler at Oklahoma and North Carolina's Sam Howell. Imagine a warehouse full of their jerseys midway through the season. That's why college jerseys have to be produced on demand, rather than importing finished jerseys.

Whether the reality of college jersey sales ever lives up to the anticipation remains to be seen, but the foundation has been poured.

"Many people don't understand the complexity and scale required to get the large group licensing programs off the ground," Eiler said. "The foundation has been poured by OneTeam, and it will build. After a year of collaborative effort, we’re seeing opportunities arise that will benefit athletes and schools over time.

A big day for the Buffalo Bills; Another big day for Rose Zhang; Jody Allen still not engaging on team sales and from intern to Big Ten COO.

SBJ I Factor presented by Allied Sports features an interview with Danita Johnson, president of business operations for D.C. United and a member of Sports Business Journal's Forty Under 40 class of 2023. Johnson talks with SBJ's Abe Madkour about learning how to sell and to not fear change, becoming an effective manager, the importance of empathy as a leadership trait, and what to look for when evaluating job candidates. SBJ I Factor is a monthly podcast offering interviews with sports executives who have been recipients of one of the magazine's awards, such as Forty Under 40, Game Changers and others.

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