Going Broke

Over the last several years, former (and sometimes current) NFL players’ sob stories hit the newswire about bankruptcies and extreme financial difficulties. According to Sports Illustrated, 78% of NFL players are broke within two years of retiring from the NFL. This alarming rate of players going broke should catch the attention of agents. While agents often don’t have financial backgrounds (or incentives to care about their clients future success after retirement), they do know how money works and how to manage their finances. Often times, agents introduce their clients to knowledgeable financial advisers. However, these young athletes find it difficult to relate to or understand the appointed financial advisers.

Agents need to take note of this dangerous trend and be more proactive in helping their clients learn enough about personal finance to avoid disaster. Since most college athletes are not allowed to work while under scholarship, they are not used to having money to manage. After graduating college, some of these athletes sign multi-million dollar contracts with large signing bonuses. With no real financial management knowledge, these athletes can go from millionaires to being broke within a few months or years.

There are numerous reasons players go broke from overspending, not saving/investing, poor investments, premature retirement (injuries), divorces or not planning for their lives after football. Some athletes do plan for their futures but because contracts are not guaranteed, they find themselves unemployed and not cashing in on their contracts. These athletes need agents to step up and provide them with a financial education as well as post-career planning to ease them into new jobs after retiring from football. Some players become analysts, coaches, or work in the front office of a football team. Others find themselves clueless on what they will be doing upon retirement. If agents had a financial incentive to manage their clients’ lives after they retire from football, we might not have this dangerous trend in bankruptcies. The NFLPA has taken action by proving a financial management education but agents have the ability and responsibility to at least encourage their clients to think about their futures. Will the NFLPA be effective enough or will agents have to get more involved? 

Players' Association Impacting Agents' Discipline

While sports have been around for over a century, the concept of sports agents is relatively new. Decades ago, sports agents became an occupation but not a very glamorous or financially rewarding career. The industry has evolved to be more lucrative for agents and has attracted some very greedy individuals. The industry has recently been overcome with scandals, infractions and agents taking advantage of their athlete clients. Professional sports leagues and the National Collegiate Athletic Association (NCAA) have been passing new rules at an increasing rate to rein in the unwanted behavior of agents.  The federal government has become involved as well as each individual state. It has now become expensive for agents to become registered in numerous states since agents have to register in every state they wish to do business in. It has become even more difficult for agents to learn and abide by the rules and laws of every state. Most states have recently adopted the Uniform Athlete Agents Act (UAAA) making it easier and cheaper for agents. Professional sports leagues and government will continue to pass more uniform laws to help prevent more intentional and unintentional missteps by sports agents but also to make it easier for agents to understand and abide by these laws.

In the last couple of years, it has also become necessary for players’ unions to step in and try to control the epidemic. The NationalFootball League Players’ Association (NFLPA) has even been busy this season discipliningagents for trivial offenses because they are unwilling to truthfully fill out their applications for certification as contract advisers. Agents Ethan Lock, Eric Metz and Vance Malinovic all agreed to pay $5,000 fines before an their appeal hearings due to their alleged offenses. Contract advisor John Rickert was also fined $5,000 and suspended for three months after failing to provide documentation he promised the NFLPA regarding a settlement with another contract advisor in a dispute about fees. As far back as November of 2010, the NFLPA pursued action against contract advisor Ian Greengross for numerous reasons including the actions of his recruiter Kenny Rogers. The NFLPA has been becoming stringent on their actions against agents who do not abide by their rules. This seems to be the new tone of leagues, state and federal legislatures, players’ unions and the NCAA. Dishonest and inappropriate behavior will no longer be accepted from agents and will be attacked from multiple sources and in a variety of ways such as fines, suspensions, and even jail time. 

The Difference Between Winning and Succeeding

As a young agent entering the business, I am still deciding who and what I am going to become. I am constantly looking for athletes, coaches and other agents to inspire me which led me to the website TED.com. The TED.com speaker that really inspired me was former UCLA basketball coach John Wooden who is affectionately known as Coach. Although I am 26 and living my adult life, I still seek ways to become inspired and to become a better me. Coach has always been an inspiration and his TED.com video titled "The Difference Between Winning and Succeeding" shares an even deeper understanding of how and when he developed his coaching and teaching philosophy. He shared with the audience about how his father raised him and the significant stories/events that caused him to grow/change his philosophies, which also garnered trust with the audience. He shared childhood stories and stories of when he first began teaching in grade school to show why his philosophy was so important.

His speech definitely helped me develop a deeper understanding of how I should measure my own success. One of his quotes that really stuck with me was, "Success is a peace of mind which is a direct result of self-satisfaction in knowing you made the effort to become the best that you are capable of becoming." To me, this means that life is not about winning or outscoring anyone. It’s not about acquiring more material things or getting more rewards for my accomplishments than someone else. Life is simply about becoming the best man I can with what I have been given. Life is about recognizing my best effort as a degree of success as opposed to my desired outcome.

Coach is well known for a model he created called the “The Pyramid of Success”. This pyramid can be found at his website and shows different traits of success as measurements of faith and patience. The pyramid consists of 15 building blocks and each block has a trait along with what he thinks what a person is to do to accomplish the given trait. By following this pyramid, it was his intention and my belief that a person will become successful. After a journey to grow each block and build my own pyramid of success, I believe I will become the best man and agent I am able of becoming.

Invisible Agents in Times of Crisis

With news breaking about the New England Patriot’s tight-end Aaron Hernandez being investigated for murder, it once again seems like sports agents have dropped the ball. Every time athletes find themselves in a crisis, their respective agents are nowhere to be seen or heard from.  While an agent puts on many hats, a publicist can be one of the most important roles and is often the most overlooked. 

Since many agents have legal backgrounds, they know that it is usually in the athlete’s best interest to refrain from making public comments when faced with legal issues. These same agents should also take into consideration the athlete’s future as far as endorsements, public opinion and employment when legal issues arise. Agents should be in “damage control” mode and should be doing everything they can to control what stories the media releases.  By giving the media enough details, they will have enough information to write an informed story instead of assuming the worst and making up their own stories.  At the very least, these agents should be telling the public not to jump to conclusions (and to keep telling them) according to the attorney for Ray Lewis’ murder trial. This would prevent at least some members of the media and a part of the general public from assuming the worst-case scenario.  It may also save a few endorsements from severing ties with the athlete along with future endorsement money. In Hernandez's case, he lost his first endorsement shortly after the news broke.

A player’s legal council will almost always instruct their client to not speak about the situation.  That leaves only one of two people who can and should speak about the situation, the lawyer and the agent.  Often times, this will be the same person.  By instructing a player to remain quiet and then having the legal team/agent remain quiet, there is no positive information reaching the media and public.  This lack of positive or neutral information will only allow the negative information to reach the public which will in turn, influence their opinions negatively.

Since the Super Bowl ended on February 3^rd, 27 NFL players have been arrested (as of June 26^th).  In all 27 cases, their agents have not made an immediate statement to the public about their innocence or encouragement for them to not pass judgment until all the facts are out.

Misunderstood NFL Endorsement Market

The responsibilities of an NFL agent became widely known thanks to the movie Jerry Maguire. Aside from finding employment for players and negotiating playing contracts, agents must also procure endorsement deals and personal appearances. This marketing aspect of the business is commonly misunderstood and can be far more difficult than one might think. For the NFL’s best players, this can be very easy but for the rest of the players, it can be nearly impossible. Relative to other sports, football players often find it more difficult to land endorsements and speaking engagements.

According to Sports Pro Media, there is only one football player in the World’s 50 Most Marketable Athletes. Athletes of varying sports from team sports such as soccer and basketball to individual sports such as tennis and golf dominate the list. It even has multiple cricket and motorsports athletes. One of the main reasons football players aren’t as marketable is recognition. Only the NFL’s best players and key position players such as quarterbacks are ever shown with their helmets off. This makes it difficult for fans to recognize them outside of the football stadium. According to National Football Post’s Jack Bechta, players that aren’t talking to the media after every game or at every practice will not be able to gain the necessary recognition that companies seeking to endorse athletes require because they are under the helmet during games. Football players often have shorter careers than other athletes so gaining the needed notoriety is often more difficult.

There are many more issues that can make endorsement deals hard to come by such as a player’s character or even another athlete’s character. When a major athlete has character issues, it hurts the marketability of all athletes in all sports.  This became very evident after Tiger Woods and Lance Armstrong had their dirty laundry aired in public. Companies quickly withdrew their endorsements and were very hesitant to seek out new players to endorse. A player’s position, lack of talent relative to other teammates and his team’s performance are also issues. While a feel good story like Jerry Maguire might entice some agents to the business, reality will eventually set in and endorsement deals may seem like a distant dream.