Troy Dannen addresses misconceptions about third-party NIL, role of donors

As the rev-share era comes up on its one-year anniversary, there’s also the quest for “above the cap” NIL dollars. There are different ways for schools to get there, but according to Nebraska athletics director Troy Dannen, donors are no longer an option.

Speaking with reporters Friday, Dannen said the days of donors writing checks solely for NIL are over. He cited the changes in place under the landmark House settlement with the NIL Go clearinghouse, which vets deals worth more than $600. It’s worth noting that 18 Nebraska football players are heading to arbitration over denied deals. Yahoo! Sports’ Ross Dellenger reported a hearing is scheduled for Tuesday.

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When it comes to “over-the-cap” NIL, though, Dannen cited the need for relationships between brands and athletes because of the changing role of collectives. He also said donor fatigue is something to navigate in the new landscape.

“I don’t think people realize what NIL is today,” Dannen said after the “Big Red Rebuild” project received Board of Regents approval. “It isn’t the days of everybody writing a check and how many people will give us money and we’ll go to 1890, deposit that and then, money’s paid. That’s not even legal anymore. The third-party NIL, the ‘above the rev-share cap’ NIL, those are actual corporate relationships with the athletes. So this isn’t a matter of, hey, I’m going to the donor now instead of 1890. You can’t even do that anymore. So one, there is a distinction.

“Secondly, donors don’t care for NIL. They’re doing it because they want our coaches to have success. That’s what’s happened up until now. What the stadium does, though, is I would tell you look at it almost as an endowment. The investment made by our donors in this stadium is going to produce revenue above debt – $15-$20 million of that revenue early on, and then growing from there.”

Troy Dannen: ‘We will be prepared for an uncapped world’

Ahead of the one-year anniversary of the rev-share era, the cap in place under the House settlement is coming under scrutiny. As Ross Dellenger previously noted for On3, schools are flying past the cap, and some in college athletics – including Miami AD Dan Radakovich – have called for it to be lifted entirely.

Troy Dannen said Nebraska has to be ready for whatever lies ahead in the player compensation era. That includes a potential world without a cap. It’s all part of the conversations taking place inside the facility.

“We’ve got to be prepared for whatever’s ahead,” Dannen said. “I will tell you we will be prepared for an uncapped world because if we’re prepared for an uncapped world, we’ll be prepared for anything in between. But that’s internal. The days of going to ask a donor to support NIL by writing a check are gone. It’s illegal.

“So part of it, there’s misnomers about what can happen. And I don’t blame anybody because the rules change by the day. That’s where we sit today. But we’re trying to prepare for whatever the inevitability of tomorrow is.”

Player compensation is ‘silver bullet’

Whether it be through revenue-sharing or third-party NIL deals, roster costs continue to rise across college sports. Football could see “multiple rosters of over $40 million,” as On3’s Pete Nakos previously reported.

To fund those rosters, Troy Dannen said Nebraska has to take a leading role in building brand partnerships. Since the cap is still in place, those agreements are crucial to maximizing the dollars.

“As the increased costs of college athletics continue, and I will tell you the No. 1 increase in costs is going to come from player compensation in whatever form it takes … is going to continue to grow,” Dannen said. “That’s how we fund player compensation moving forward. Matt Rhule has to have every bullet in his holster, and the ability to fund the player compensation piece, I would guess he would tell you is the silver bullet. It is the most important bullet in his holster.

“So the idea that we have to fund this through our department. We have to find partnerships with companies for our athletes to get above the cap.”