Yes, FanCave is fully compliant. Here’s how.

Yes, FanCave is fully compliant. Here’s how.

4/1/2024


tl;dr: Just like NIL collectives, FanCave enables fans to interact with college prospects and boost their NIL value for the fans’ favorite school. FanCave’s “public collective” is compliant with state, federal, and NCAA NIL rules (i.e. “true NIL” quid-pro-quo).
🏟️ www.fancave.me 🏟️

Welcome to FanCave: the first public collective

FanCave brings the shady, dark room operations of private collectives—into the light of the internet. We cut out the middle man to let athletes safely monetize their talent, and let any fan pitch in to recruit top players directly

What does an NIL collective do?

  • Pool fan money to offer to top prospects (high school, transfer portal) to attend their school
  • Fans have no control over how the money is used
  • NIL contract offers negotiated with athletes under-the-table
  • Compensation contingent on predatory terms: payback clauses, forced exclusive NIL rights ownership, NDAs, etc
  • Shell quid-pro-quo events to fulfill contract requirements

What is FanCave?

  • A public collective—cutting out the middle man and directly supporting athletes
  • Fans can directly interact with and support the specific players they care most about
  • Athletes earn compensation from FanCave based on the NIL value fans attribute to them—regardless of where they enroll
  • No shady contracts—NIL deals are paid out evenly over twelve-months while the athlete remains enrolled at any school
  • Fully compliant per recent regulation & fulfillment of NIL quid-pro-quo before money is paid to athletes

History of NIL Collectives

Compensation for college athletes through the original intent of NIL—brand endorsements and custom merch—became pennies compared to the real money: NIL Contracts from ‘Collectives.’

It only took a few months and some smart donors to figure out some key NIL bylaw loopholes—enabling big-pocket donors to pool their money, and use this pool as financial leverage to offer money to top recruits to entice them to come to their school.

This entity founded on the grounds of this legal loophole was called a ‘Collective.’ While the NCAA later updated their guidelines to try to reel this behavior in, the genie was already out of the bottle:

  • $8 million NIL deal inked with a 17-year-old QB for Tennessee (source)
  • Texas’s backup QB allegedly made more via NIL last year than Brock Purdy, the starting Super Bowl QB (source)

What began as a legal way for athletes to endorse their local restaurant turned into six-figure contracts from ‘NIL collectives’ to entice the best players to their school. And the same regulatory gray area that made Collectives ‘legal’ reflects the gray area in which they operate:

  • Not Inclusive: Collectives restrict membership to specific athletes in select sports (top 1%)
  • Not Transparent: Collectives aren’t transparent about how and where donor money goes
  • Not Fan-Friendly: Collectives control allocations and only let donors donate to ‘the general fund’

Even though the rules technically didn’t allow Collectives to use NIL as a recruiting tool… think that stopped them? It’s no secret that NIL drives recruitment decisions, and that’s where these shady Collective practices give them the upper hand:

  • Behind-closed-doors conversations that ‘technically never happened’
  • Under-the-table contract values that are predatory and non-negotiable
  • Controlling terms via short-term contracts, payback clauses, and forced exclusive NIL rights ownership

Private collectives put athletes at risk — yet fans continue to fund these shady operations. We believe a new system—one that is public, transparent, and online-first—needs to fix this mess. That’s why we made FanCave.

The 2024 Regulation Change Legalizing NIL + Recruitment

As of March 1, 2024—regulation change enabled collectives to offer contracts directly to recruits, and recruits have the power to negotiate those contracts before they commit.

The Eastern District of Tennessee announced a preliminary injunction on February 23, 2024, that officially blocked the NCAA’s ability to enforce any of its NIL bylaw rules:

"...without the give and take of a free market, student-athletes simply have no knowledge of their true NIL value... this suppression of negotiating leverage... harms student-athletes."
- TENN v. NCAA, Preliminary Injunction (Feb. 23, 2024) - Full Doc Here

And one week later, on March 1, 2024, NCAA President Charlie Baker concurred with this court ruling:

"...NCAA staff to pause [enforcement of] third-party participation in NIL-related activities ... consistent with the injunction [regarding the NIL-recruitment ban]”
- Charlie Baker, Letter to NCAA member schools (Mar. 1, 2024)

What does this mean?

Prospects (both recruits and transfers) finally have the leverage to compliantly discuss, understand, negotiate their NIL value prior to committing to a school. So, as of 3/1/2024, the NIL-recruiting ban has officially been lifted.

FanCave is built on compliance and athlete trust

FanCave was built though hundreds of conversations with NIL Lawyers, Athletes, Collectives, Fans, Boosters, and more. If the future of NIL-based recruiting is here (it is), we believe:

  • Athletes deserve to openly assess their NIL value on a per-school basis
  • Fans—a team’s true lifeblood—deserve to have a real part in assembling their team’s future

FanCave is the first public collective—cutting out the middle man and directly supporting athletes:

  • Fans can directly interact with and support the specific players they care most about
  • Athletes earn compensation from FanCave based on the NIL value fans attribute to them—regardless of where they enroll
  • No shady contracts—NIL deals are paid out evenly over twelve-months while the athlete remains enrolled at any school
  • Fully compliant per recent regulation & fulfillment of NIL quid-pro-quo before money is paid to athletes

We’re excited for the future of a free and open NIL-driven recruitment process, but the reality is that NIL collectives still exist. Under-the-table NIL offers still exist. Predatory contracts still exist.

What is now possible is not yet a reality.

FanCave makes this a reality—prioritizing compliance, athlete safety, and fan trust. Here’s how it works:

  1. Top prospects (recruits, portal targets) earn a verified FanCave page
  2. Fans offer their favorite prospects
  3. Funds offered are displayed on a public leaderboard—tracked per-fanbase and per-recruit
  4. Recruits cash out when they commit (earn a FanCave NIL deal based on the total ‘NILScore’ they accrue during their recruitment).

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Taking this commitment a step further, FanCave is a partner of the Public NIL Standard, an initiative seeking to establish a better role that NIL plays in college sports: www.publicnil.org

About FanCave

We’re backed by Y Combinator (of Airbnb, Reddit, and others) to sustainably pursue the mission of building the first open platform for collegiate free agency. And we’re just getting started.

  • Want to play a part in building your team’s future? sign up at www.fancave.me
  • Want to hear more? Reach out at hello@fancave.me
  • Want to follow the journey? Follow @lukebogus + @siscoe_

FanCave is powering the free agency of college athletics. Backed by Y Combinator, we empower fans to directly build their teams’ future—while allowing athletes to safely understand, own, and grow their NIL.

🏟️ Fans? Support your team here → www.fancave.me

🏆 Recruit? Begin your journey here → www.fancave.me/recruits