Here is a volunteered explanation from one of Georgia's top donors who's a member of the Vent and hopes these comments are helpful.
We will not reveal their name, but we can vouch for their identity. We can also unequivocally state that this donor is in a position to know what they are discussing here. They are doing this as a service to the DawgVent community and staff and wish to remain anonymous. I urge you all to take the time to read this.
"This is offered in response to a recent suggestion to hear from a major donor about NIL/donations, etc. I’ve contributed several million dollars to the UGA Athletic Association (and the University of Georgia) and interact regularly on these issues with the AD, coaches, and other significant donors.
I realize the following is TLDR and a lot may be self-evident but it’s a complex thing to describe. With that, here are some observations in no particular order (I’ve tried to be as fact-based as possible):
- while our NIL fund is less than TAMU and TX, in the SEC, we are competitive with/better than everyone else. To date, when we’ve lost someone due largely to NIL it’s almost always been because Kirby felt the player wasn’t worth it and/or chose not to break his “salary structure”. But other programs are raising more and more NIL money (tOSU is a good example) and with prices rising we risk falling behind. The need to increase the level at UGA is real.
- the UGAAA administration is and has been actively encouraging donors to make NIL donations; they see on-field success as key to their fundraising and feel a rising tide will lift all boats, so they are encouraging and supporting, not squelching, NIL efforts with large donors.
- but that doesn’t mean there isn’t significant tension between money raised for the Athletic Association versus money raised for NIL. The UGAAA pays for +/-20 sports so coaches’ salaries, facility improvements, operating costs, payment for scholarships, etc. all fall on UGAAA and all are escalating (yes, UGAAA pays the university for each athletic scholarship).
- those costs are rising fast and if/as growing NIL emphasis restricts their revenue, the UGAAA has three options to cover them: cut costs, generate more donations or increase prices (or a combo). NIL definitely makes UGAAA fundraising harder; it’s not a zero sum game but there definitely is overlap/impact
- also, “donor fatigue” is real and donors feel like they’re being squeezed from all sides (and not just from football; every head coach for every sport at UGA is pushing donors for NIL money - I’ve been approached directly not only by Kirby but also by the head coaches for men’s and women’s basketball, baseball, golf and track for NIL donations). All in addition to the needs of UGAAA we are asked to support. Don’t get me wrong, I’m not asking for tears - I am blessed to be able to support UGA as I have - but the mounting requests are ratcheting up the pressure on large donors and affecting giving.
- I feel like it isn’t practical to say UGAAA should forego donations to encourage NIL even more than is already happening organically; we actually need both to go up. It would be nice if UGAAA could raise funds and use them for NIL as well as their other needs but that isn’t allowed under NCAA rules, plus it would create difficult/unresolvable Title IX issues so it’s a question of balance.
- on the fundraising side, UGAAA has been a fundraising behemoth since Kirby arrived (the two facts clearly are related, causally). We’ve set new annual records for six straight years and last year went over the $100M mark - that puts us in the top 3 in the SEC. We’ve gone from about 20 Silver Circle ($1M or more) donors to around 150, as one example.
- those funds, under NCAA rules, cannot be used for NIL; neither can the increasing TV money we receive. NIL donations generate neither UGAAA points nor a tax deduction, which are factors for some large donors (but it can be claimed as a business expense for those donors who own businesses).
- on the ‘pricing’ side, the studies cited in the thread can be misleading given that each school handles prices, donations and revenue generation differently and factoring in things like the ‘tickets for life’ policy at UGA: while it takes a significant contribution level to get “good seats” as a new season ticket holder, your seat is yours for life (plus your surviving spouses’s life), which means a LOT of the good seats at Sanford are filled with people who have had their seats for a long while and haven’t made massive contributions. That means those people who have recently make large contributions can’t necessarily move into those best seats - no matter how much you've given you can’t get a seat until someone gives it up. Same for parking.
- UGAAA has raised the per seat charge once in over 10 years. Once. How many businesses can afford to not raise prices on a regular basis? A 50 yard line seat in the lower bowl is less than $500, which is quite low given what UGAAA could get for it on the open market. Plus ticket prices have grown less than inflation and our suite prices are also very low relative to other places. Raising prices for tickets, parking, etc. would open things up for Magill donors but UGAAA has actively resisted doing that.
- how has UGAAA been able to do that? The answer basically is fundraising plus TV revenue increases. Venters like to complain about Magill but it’s an example of creative fundraising that’s driven higher revenue, which has allowed UGAAA to not raise prices (or even perhaps re-seat Sanford, which tOSU does with their stadium every five years, BTW). It seems to me that if/as NIL squeezes UGAAA fundraising the need for pricing will go up.
- FYI, the new Press Club premium seating area will be market priced; it will take over a million points to qualify to pay $7500 per seat (every year) to sit there. Compared to the rest of the stadium that’s obviously a LOT higher and represents a new $2M+ every year for an area that was non-revenue generating. That may be a sign that UGAAA is trending toward more pricing actions. (The two new suites being added will require a $10M donation, FYI.)
- some of the Vent suggestions to raise NIL money aren’t practical/legal but others are creative and good and we should do them. I wish our NIL effort was more creative in ways to generate revenue (the reality is that huge donors are always going to be critical but more grassroots efforts are helpful and powerful, too).
In the ‘my opinion’ category: I feel that Kirby’s incredible success has masked these underlying realities by letting UGAAA raise millions from donors and thereby allowed UGAAA not to have to press the “pricing” button. But as NIL needs to grow I think they’ll have no choice but to do so for us to remain competitive across all sports. And were our on-field football performance to drop I think we’d likely face immediate revenue issues and some very tough calls.
Also, like most Venters, I feel we’re headed toward a train wreck that will force change. I don’t think NIL has ‘ruined’ college football - I think unregulated NIL plus the ability to immediately transfer and play is ‘ruining’ it (which is down to horrific leadership and lack of a proactive vision by the NCAA/college presidents). Who knows when that happens, exactly, but unfortunately it’ll almost certainly be driven via litigation, which is unlikely to be a good thing (although that may finally force schools to change). There are some very dark clouds on the horizon and no clear answers - we are blessed to have Kirby but we need to realize that’s temporal and be building the foundation for a highly flexible, sustainable model.
Go Dawgs!"
We will not reveal their name, but we can vouch for their identity. We can also unequivocally state that this donor is in a position to know what they are discussing here. They are doing this as a service to the DawgVent community and staff and wish to remain anonymous. I urge you all to take the time to read this.
"This is offered in response to a recent suggestion to hear from a major donor about NIL/donations, etc. I’ve contributed several million dollars to the UGA Athletic Association (and the University of Georgia) and interact regularly on these issues with the AD, coaches, and other significant donors.
I realize the following is TLDR and a lot may be self-evident but it’s a complex thing to describe. With that, here are some observations in no particular order (I’ve tried to be as fact-based as possible):
- while our NIL fund is less than TAMU and TX, in the SEC, we are competitive with/better than everyone else. To date, when we’ve lost someone due largely to NIL it’s almost always been because Kirby felt the player wasn’t worth it and/or chose not to break his “salary structure”. But other programs are raising more and more NIL money (tOSU is a good example) and with prices rising we risk falling behind. The need to increase the level at UGA is real.
- the UGAAA administration is and has been actively encouraging donors to make NIL donations; they see on-field success as key to their fundraising and feel a rising tide will lift all boats, so they are encouraging and supporting, not squelching, NIL efforts with large donors.
- but that doesn’t mean there isn’t significant tension between money raised for the Athletic Association versus money raised for NIL. The UGAAA pays for +/-20 sports so coaches’ salaries, facility improvements, operating costs, payment for scholarships, etc. all fall on UGAAA and all are escalating (yes, UGAAA pays the university for each athletic scholarship).
- those costs are rising fast and if/as growing NIL emphasis restricts their revenue, the UGAAA has three options to cover them: cut costs, generate more donations or increase prices (or a combo). NIL definitely makes UGAAA fundraising harder; it’s not a zero sum game but there definitely is overlap/impact
- also, “donor fatigue” is real and donors feel like they’re being squeezed from all sides (and not just from football; every head coach for every sport at UGA is pushing donors for NIL money - I’ve been approached directly not only by Kirby but also by the head coaches for men’s and women’s basketball, baseball, golf and track for NIL donations). All in addition to the needs of UGAAA we are asked to support. Don’t get me wrong, I’m not asking for tears - I am blessed to be able to support UGA as I have - but the mounting requests are ratcheting up the pressure on large donors and affecting giving.
- I feel like it isn’t practical to say UGAAA should forego donations to encourage NIL even more than is already happening organically; we actually need both to go up. It would be nice if UGAAA could raise funds and use them for NIL as well as their other needs but that isn’t allowed under NCAA rules, plus it would create difficult/unresolvable Title IX issues so it’s a question of balance.
- on the fundraising side, UGAAA has been a fundraising behemoth since Kirby arrived (the two facts clearly are related, causally). We’ve set new annual records for six straight years and last year went over the $100M mark - that puts us in the top 3 in the SEC. We’ve gone from about 20 Silver Circle ($1M or more) donors to around 150, as one example.
- those funds, under NCAA rules, cannot be used for NIL; neither can the increasing TV money we receive. NIL donations generate neither UGAAA points nor a tax deduction, which are factors for some large donors (but it can be claimed as a business expense for those donors who own businesses).
- on the ‘pricing’ side, the studies cited in the thread can be misleading given that each school handles prices, donations and revenue generation differently and factoring in things like the ‘tickets for life’ policy at UGA: while it takes a significant contribution level to get “good seats” as a new season ticket holder, your seat is yours for life (plus your surviving spouses’s life), which means a LOT of the good seats at Sanford are filled with people who have had their seats for a long while and haven’t made massive contributions. That means those people who have recently make large contributions can’t necessarily move into those best seats - no matter how much you've given you can’t get a seat until someone gives it up. Same for parking.
- UGAAA has raised the per seat charge once in over 10 years. Once. How many businesses can afford to not raise prices on a regular basis? A 50 yard line seat in the lower bowl is less than $500, which is quite low given what UGAAA could get for it on the open market. Plus ticket prices have grown less than inflation and our suite prices are also very low relative to other places. Raising prices for tickets, parking, etc. would open things up for Magill donors but UGAAA has actively resisted doing that.
- how has UGAAA been able to do that? The answer basically is fundraising plus TV revenue increases. Venters like to complain about Magill but it’s an example of creative fundraising that’s driven higher revenue, which has allowed UGAAA to not raise prices (or even perhaps re-seat Sanford, which tOSU does with their stadium every five years, BTW). It seems to me that if/as NIL squeezes UGAAA fundraising the need for pricing will go up.
- FYI, the new Press Club premium seating area will be market priced; it will take over a million points to qualify to pay $7500 per seat (every year) to sit there. Compared to the rest of the stadium that’s obviously a LOT higher and represents a new $2M+ every year for an area that was non-revenue generating. That may be a sign that UGAAA is trending toward more pricing actions. (The two new suites being added will require a $10M donation, FYI.)
- some of the Vent suggestions to raise NIL money aren’t practical/legal but others are creative and good and we should do them. I wish our NIL effort was more creative in ways to generate revenue (the reality is that huge donors are always going to be critical but more grassroots efforts are helpful and powerful, too).
In the ‘my opinion’ category: I feel that Kirby’s incredible success has masked these underlying realities by letting UGAAA raise millions from donors and thereby allowed UGAAA not to have to press the “pricing” button. But as NIL needs to grow I think they’ll have no choice but to do so for us to remain competitive across all sports. And were our on-field football performance to drop I think we’d likely face immediate revenue issues and some very tough calls.
Also, like most Venters, I feel we’re headed toward a train wreck that will force change. I don’t think NIL has ‘ruined’ college football - I think unregulated NIL plus the ability to immediately transfer and play is ‘ruining’ it (which is down to horrific leadership and lack of a proactive vision by the NCAA/college presidents). Who knows when that happens, exactly, but unfortunately it’ll almost certainly be driven via litigation, which is unlikely to be a good thing (although that may finally force schools to change). There are some very dark clouds on the horizon and no clear answers - we are blessed to have Kirby but we need to realize that’s temporal and be building the foundation for a highly flexible, sustainable model.
Go Dawgs!"
