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Teenage basketball stars make big bucks before they even get to the NBA

Tyler Smith is 16, 6-foot-9, and has the kind of basketball skills that varsity coaches turn green. But the Houston-area athlete gave up his future NCAA eligibility – and his final two years of high school. Instead, he turns pro.

Smith and 23 of the brightest young players in the United States and abroad have signed on to play in a new basketball league – Overtime Elite – which launched in March and is part of Overtime, a company of media that debuted in 2015 with an app that featured highlights of amateur basketball action. Each OTE player will win $ 100,000 per year, train year-round at state-of-the-art facilities, take courses in financial literacy and social activism, and be coached by former University of Connecticut and NBA veteran Kevin Ollie .

The league is part of a booming world in which amateur athletes have a myriad of options that allow them not only to chart a course for the pros, but to monetize that journey every step of the way. The traditional path of a teenage phenomenon trying to get a sports scholarship in a powerful Division I program and working toward the goal of playing professionally has given way to a new business model: making money and growing your business. mark early.

“In the end, the pros outweighed the cons,” said Chris Gaston, a Houston-based agent who founded Family First Sports, an NBA-focused agency, and who represents Smith. He said Smith and his mother had been thinking about the deal for more than three months before making a decision. “Tyler’s goal is to be a professional basketball player. He thought it was the best road to get to the NBA.

Even before a Supreme Court ruling in June established that the NCAA cannot prevent student-athletes from being compensated – a decades-old problem that had been out of balance in favor of fattening colleges and universities. their coffers thanks to the performances of their players – many young sports stars had started to ignore the college route altogether, choosing instead to earn a six-figure salary, sometimes at the same age as a teenager is eligible to apply for a driver’s license . Some college athletes are already signing lucrative sponsorship deals.

Now, between alternative routes like Overtime Elite and the lucrative sponsorship deals that college players are attracting, young athletes have a growing number of choices for making money – and a lot of people who want to help them do it. while taking a little for themselves. The growing market has attracted major funders. Amazon founder Jeff Bezos and Canadian rapper Drake have invested in Overtime Elite, which launched in March and stands as a direct path to the NBA, where players ages 16-19 are salaried employees.

Overtime has refused to make executives available for interviews.

While the market now offers young athletes many more options than before, some in the sports media industry warn that some of these choices are riskier than others. Steve Trax, head of sports and entertainment for MAI Capital Management, warns against compromise.

“It’s important to think about short-term wants, but to consider long-term needs and not run after the almighty dollar before a very structured process,” he said.

“My advice to all young athletes and their families is that they have to go through this process very slowly,” added Trax. “And I strongly advise families to develop a strong team of counselors. “

This is a distinct change from just a few years ago. Since the early 2010s, a boom in social media content around amateur basketball has raised the profile of some young players, including Zion Williamson, whose high school moments have become an internet sensation. (After a season at Duke, Williamson was the No. 1 NBA Draft pick in 2019 and now plays for the New Orleans Pelicans.)

Young basketball players no longer have to go to the pros to capitalize on their athletic skills. Julian Newman first gained attention on social media as a fifth-year student on his varsity team in Orlando, Florida. Now 20, Newman has 749,000 Instagram followers, a clothing line and a reality show. And he’s still working on his dream of playing in the NBA, training in Las Vegas with the goal of playing professionally in Australia or the NBA’s G League.

“It’s easier to create a brand now. The world flows on the Internet, ”said Newman, who has jumped the university route. “But,” he warned, “you still have to have it. Some people can make their own brand and that won’t do anything, because no one cares about that person. No disrespect to anyone. . There are a few great hooters who don’t have a good following behind them so their brand won’t do well. Some have to make it to the NBA and become an All-Star for their brand to be popular. “

The NBA provided another option. The Ignite program, which has been around for a year in the NBA’s G League, allows high school graduates to sign a lucrative deal, train and grow for a year before they turn 19, the age at which prospects are draft eligible. Ignite’s players are giving up their NCAA eligibility in exchange, but the year of intense training could bolster their draft value. Following the end of Ignite’s inaugural 2020-21 campaign, two of his players were among the top 10 picks in the ʼ21 NBA Draft – Jalen Green at No.2 and Jonathan Kuminga at No.7.

“Beauty is in the eye of the beholder,” said Gaston, the Houston sports agent. “The G League is not for everyone. Overtime is not for everyone. In college, you have to choose which route is best for you and your family. There is no one size fits all with this.

Dyson Daniels, a highly touted 18-year-old Australian goalkeeper, said he chose Ignite over the university not only for the rich experience and development of basketball and the opportunity to be paid, but also because ‘Ignite promotes growth off the field of his players.

“They help us do things like build our brand,” Daniels said. “They have people here who specialize in this stuff. To have a great brand today is a great thing. I think I made the right decision.

Gaston said the same of Overtime Elite and Smith.

“They’re going to take classes on financial literacy, social activism,” he said of the players. “They are going to learn a lot of life lessons.”

Even NBA commissioner Adam Silver endorsed Overtime Elite this year.

“I think it’s generally good for the community to have an option, especially when very strong people, which seems to be, are supporting them and supporting them,” Silver said ahead of the 2021 All-Star Game.

But the decision to seize these opportunities is not easy. Joining these leagues means giving up NCAA eligibility and, in the case of Overtime Elite, high school eligibility, meaning players can’t get scholarships if they change their mind. Overtime Elite guarantees $ 100,000 for tuition fees if a player decides not to pursue a professional career.

“Eligibility for college and maintaining eligibility is very important to a future professional basketball player,” said Jason Setchen, a Florida lawyer who has represented many NCAA athletes. “And if he’s lost, he may be gone forever. Children should be aware of this. “

It’s a choice Setchen fears some young athletes may not be ready to make.

“Most kids who are 17 and are considering that kind of money in the short term, even at the expense of their eligibility, may not be mature enough to make an informed decision,” he said. “The college-NCAA path at this point is even more proven.”