New Age Athletes Manage Themselves and Reduce Dependence on Agents. Andrew Bogut is Proof.

Andrew Bogut is a 7’-0” center for the Golden State Warriors. He earns $13 million annually. Like most NBA players, he has used an agent to negotiate on his behalf and handle the much of his business and charitable affairs. Unlike most NBA players, he did not grow up with the United States professional sports anesthetic of league, team, and agent dominance over the business and financial affairs of the player. He is from Melbourne Australia. And unlike many employees, he grew up inclined to challenge traditional authority figures, leading at one point to his dismissal from a high school in his junior year.

But there are various types of intelligence. Academia does not have exclusive jurisdiction over business savvy, though Bogut was a business major while at University of Utah.  At 27 years old, Bogut has now been in and out of the NBA, with injuries as a contributing factor over the past eight years. The recent NBA lockout gave him time to consider the business of being an NBA player. And perhaps the injuries unwittingly enhanced his sense of how fleeting the career can be. So during that break in physical action, his mind took center stage. Bogut started developing a plan to buy into his agent’s management company, One Management Group & Consulting (OMGC).

If that arrangement is successful, he can reverse the financial relationship, i.e. instead of the agent deriving significant income from him, he can derive income from the agent. More specifically, Bogut could then utilize his current $13 million salary to buy into the sports management business and use his current goodwill and market value to lure other players into the agency.  In fact, all those services his agent, Bruce Kaider provides in managing his affairs, he can now profit as the agent for others, unless there is an agreement to the contrary. So during the very short period in which he has player income and intangible assets, he should generate additional revenue streams beyond his physical on-court performance. 

And while his salary is individual income to him on which he must pay state and federal income tax, he can still have the for-profit business that generates deductions, and can still develop his own foundations with expenses and charitable contributions that can ultimately reduce his tax liability.  Instead of his agent receiving all revenue generated from setting up his business and charitable affairs, Bogut can take a share of the profits derived from his own labor as a player.

More importantly, by leveraging his current influence among NBA players, he potentially can negotiate an agreement where he makes money from existing firm clients, new clients brought in by others, as well as the clients he personally brought to the firm.  

And most importantly, once his playing career is over, his own agency can be his landing spot for a second career – a career that could have more long term stability, still high income, and still involving the game he loves, albeit from the sports management perspective. And as a part-owner, I suspect there is an understanding as to how he will be tutored so that he too can be an agent of others. Even while he plays professionally, he can learn how to do more for himself, essentially paying himself instead of others to manage more of his own affairs.



That self-help and empowerment over one’s own career is what I call the New Age Athlete. Bogut is positioning himself to learn as much about his own intellectual property rights as those who currently control them. I also suspect this is not an aberration but a future trend, as players become increasingly sophisticated in the business in which they perform.

If you want to comment on Andrew's efforts or want to assist with his current charitable ventures, acces his official website at http://www.andrewbogut.com/ 

Foundations -IRS Filing made Easy.

Required Forms for Foundations Now Available Online

Charitable organizations, including the foundations most used by professional athletes, are required to Forms 990 or 990 E-Z. Those forms have just been made available online for the tax year at: http://www.irs.gov/charities/article/0,,id=233830,00.html   

If your organization makes $25,000 or less, you qualify as a small tax exempt organization and can submit a very user-friendly Form 990-N.  

Your organization can file any of these forms online. If there is an undue hardship the IRS may waive the requirement of the electronic filing.

All forms are due on May 15 of every year but you can apply for an extension. To apply for an extension, you can request a 3 month extension by filing a Form 8868.

It is important to file. It is not overly burdensome, and at worst an extension request is worthwhile. Otherwise your organization is subject to a penalty. You may have to pay up to $20 a day for each late day of filing. However, the IRS will not charge you a penalty if you had a good cause for your late filing.

If the Center for Sports and Social Entrepreneurship can be of assistance, please feel free to contact Professor Roger M. Groves, rgroves@fcsl.edu.

jennifer@franceathletes.com

Jamal Crawford Giving Back

“I love basketball, but basketball doesn't define me” is Portland trailblazers guard Jamal Crawford’s twitter tagline.  So we look at the man behind the basketball.  Crawford has spent most of his off-season giving back to his hometown community of Seattle   He is involved in programs such as “High Tops and Healthy Hearts” a program raising funds to benefit Seattle Children’s Sport Health Program to him funding an all girl intermural team.  Crawford is committed to encouraging youth to not only strengthen their bodies but their minds as well helping them to become well-rounded adults.  We salute Crawford for not only being phenomenal on the court but for his Philanthropy.

Dominique Price, CSSE Contributor.

Kentucky Players and Coaches are Still Underrated.

If I asked you which team had the best scoring percentage
defense in the country and 10th scoring defense you might say
Michigan State, or Princeton or BYU or some other team not known for being
flashy. I suspect you would not say Kentucky, yet that’s the right answer.

The question is: Why are we surprised? The answer may be that we have biases not
disclosed to anyone – not even ourselves. The Kentucky team depends on freshmen
at several vital positions, particularly point guard (Teague) and center (Anthony Davis), and small forward (Kidd-Gilchrist). And the veteran go-to-guy is a sophomore (Terrence Jones).

We believe defense is all about self-sacrifice, discipline, work ethic, mental toughness, and technique.

If you are over 40 like me…OK over 50, then we may as well admit that we assume the youth, by virtue of youth, just don’t work as hard as our generation. We assume that youth, like our own children or those we know, have a level of immaturity, which means they may act without appreciating the consequences of their action. Therefore, they often act prematurely, and are
thusly prone to error. We assume they need more time to get the engrained techniques that must be taught, not natural. Examples include moving your feet to stop the opposition instead of your hands to reach in and foul.

We also assume the kids are more prone to “me-first-ness” which means they want to get the glory of scoring, rather than concentrate on the thankless task of preventing the opponents from scoring. We assume they do now know enough about sacrificing their body to take a charge.
And then there are some of us who probably don’t realize that when we see a fast paced run-and-gun style, we assume all they do is offense.

So we are surprised when a group of guys new to shaving can execute all those elements that comprise defensive excellence. The definition of excellence should include a high level of consistency in doing the right thing. Kentucky enters the NCAA tournament having earned those impressive defensive statistics over 34 games during the season, despite having the bulls-eye on their back, taking everyone’s best shot, saving their best effort and yes their best offense for Kentucky.

Credit, like blame, should be shared. Defense means mentally saying, “I may be outplayed but not outworked”. That mental toughness and technique building did not happen by accident. Coaches privately admit that no one coach has a monopoly on coaching methods. They share plays with each other in camps. They move from job to job and take their methods with them. What is unique is their brand of communicating, their personality, their judgment and wisdom about organizing a system and picking staff and player personnel.

For three years now, John Calipari has that combination of attributes to do something virtually unprecedented in modern college basketball. He has brought in the highest quality talent in each season to Lexington Kentucky. If we had not been previously shocked and therefore now
conditioned by Michigan’s Fab Five, the media and fans would be going crazy, claiming Calipari was inciting a riot in the sport and he cannot has “sustainability” without long term loyalty by players to the program. Each season he brought in an eye-popping collection of McDonald’s All
Americans. Each season therefore Calipari faced the challenge of downsizing All American egos, and creating a culture of sacrifice.

But before I say Calipari did all of that, I am not going to succumb to the underlying and
undisclosed assumption that the selected All Americans had bigger-than-necessary egos. It is entirely possible and frankly more likely probable, that these are just very good team players who were extraordinarily talented. I suspect there is already a willingness to sacrifice, and had some
good home training as an ingredient. Stated differently, I don’t think one coach completely transforms an entire group of players in a season, without a qualitative character within each of them to “buy in” to the coach’s system. Many scholars and social scientists have authored empirically based studies concluding that much of one’s personality and mental aspects are molded early in life. Each of these highly recruited players with super-sized talent brought a lot to Kentucky.

Yet sharing the credit means noting that Calipari convinced them to come. Yes, there is Kentucky tradition and resources, but the Wildcats have had plenty of other coaches before Calipari. I doubt any of them could have reached the influence level like Calipari. Calipari had to have something special. He had convinced them he was trustworthy with their future, honest and
tough-loved with them, and culturally attuned enough so he could communicate with them in a way they can appreciate. Not every coach can do that. Some coaches never get enough of the blue chip players. They soon have to put their house up for sale. Other coaches get the players, but have trouble connecting until they are juniors or seniors. By that time, the team suffers losses and/or transfer attrition.

So part of Calipari’s transformative coaching is his ability to blend all those intangibles, getting the player buy-in to the system harmoniously all in one year. And then Calipari has repeated that process the next year and now again this, the third year. When top players leave after one year, Calipari’s testimony has been clear, honest, and so resonating with players, that the next wave of blue chippers are as convinced as the players they adulate and now hope to replace. If the Calipari experience was not working, if Calipari was not the honest broker for them, believe me, players talk. And the youngest teenagers respect the opinion of the senior teenagers. Something very special is going on in the locker room, practices, and training tables we never see on the court. Calipari is indeed very special.

I trust all this player and coach-speak does not leave you feeling sorry for the university, being taken advantage of by these employees and students. Just like the Patrick Ewing/John Thompson glory years of Georgetown or Fab Five years at Michigan, I suspect the royalty revenues at Kentucky, already in the millions per year, is rising. In the two years of Michigan’s Fab Five, the merchandising royalties grew from $1.6 million to $10.5 million. Even after the scandal, U of M did not have to give any of itback. Applications to Kentucky by non-athletes too, I suspect, are also on the rise during the Calipari era. But as for the moment, we should at least takenote of something special. Calipari and particularly the players in each of these years comprise a shared success, defying our unwitting assumptions.

Green Bay Packer Fans are a Refreshing New Super-Pac.

We are inundated daily with anecdotal evidence that “it’s all about the money.” There seems to be a collective throwing up of hands in surrender, giving up on the notion that people do things for the right reasons, or should I say, people will not do the right thing unless they make money for doing it. In politics, we know the US Supreme Court opened the door to super-sized contributions for political purposes. We throw up our hands and ask whether political action committees have more influence on elections than democratic ideals or the interests of most Americans. In sports, the not-for-profit NCAA and its member institutions is Exhibit A for hypocrisy in the minds of many. In pro sports, team or player loyalty gives way to the common disclaimer: “it’s a business”. So for those of us who are sports idealists, forced by intellectual integrity to be realists, it is important to seize upon evidence to the contrary – that people sometimes choose to actually have non-monetary returns when they spend their own money.

Barely reported in newspapers, radio, television, or social media is the fact that fans of the Green Bay Packers just finished paying $67 million for a stadium renovation. More specifically, they each bought a tiny piece of the team when buying shares of corporation, and the money raised will be used for the renovation. Saliently, each of those who were part of 268,000 shares purchased decided to pay cash without any expectation of receiving more money than they paid as a return on their investment. They were advised that when they buy shares of stock in the Packers they would not receive dividends. There is no expectation of increased appreciation in the shares they purchased. But these new shareholders could transfer stock to family members. That tells us that the value of ownership wasn’t in the anticipation of receiving more money than invested. It was not about the money. It was the nonmonetary value that comprised the return – the intangible sense of loyalty, supporting “my” team, and someday giving a piece of what I sentimentally care about to people I love.

These fans are on the fringe of becoming social entrepreneurs. When buying shares, and without officially declaring it, these Packer fans became a Fan-Pac. They had a combined purpose of profitability and philanthropy. They help enhance profits because paying for stadium improvements means the corporate owners have to borrow less, pay less interest, and thereby reinvest those savings in interest payments into player salaries or hiring and retaining top executive talent. But they also were motivated by something more than money. This translates into a double bottom line.

Perhaps these Packer fans are on the cusp of a new age of fandom. A future Fan-Pac project may expand beyond a stadium renovation. The corporate owners may so appreciate the new capital from Fan-Pac that the Board of Directors (elected in part by the Fan-Pac) may authorize a small percentage of the new capital for charitable projects designed to help the communities that support the team. The project may be “Packers for the Homeless” or even a fund for players. Pittsburgh Steeler Ryan Clark lost several organs after playing in Denver due to a blood disease called sickle cell anemia. Other players have that same disease, some of whom may be current or former Packers. Some funds could be allocated to fund research to refine procedures for emergency treatment of players with that disease or for that matter, heart abnormalities. A Saint-Pac may develop among New Orleans Saints fans that the owners agree can help subsidize housing for a city still feeling the effects of Hurricane Katrina. It would be less government dependence, more private equity, to help those in need.

I may never understand or accept the media conclusion that we prefer to view perversity, or gossip or tragedy over philanthropy. I think the society will be judged more by how we took care of the most needy, not on how rich a few of us got. But I can at least do my part to show evidence, wherever we find it, of the best within us to find a balance, a double bottom line.

This is not the first Fan-Pac. Children in several communities have formed their own, albeit unprofessional, teams. But their teams are not playing a sport. They shave their heads to support classmates with childhood cancer. The charitable funds are raised in joint venture with adult nonprofits and hospitals funds research for a cure. If children without much money, but plenty of hair use that precious commodity as currency for charity, we can have fans with discretionary income among 32 pro football teams, and 30 pro basketball teams, and every other pro team sport do the same? If hospitals and non-sport foundations can joint venture, so can professional sports teams.

Yes, NFL and NBA owners have foundations with charitable activities. And adults place billions into nonprofit organizations each year for the right reasons. We just don’t hear much about it. I suspect that is why this Fan-Pac robustness is just beyond the horizon. The more exposure we give to the projects, the better chance for more of the same. We need more reminders that even in sports, money doesn’t make the world go round, people do. People like Packer fans who say, I’d rather pay to pass on Packer loyalty than buy another share of Exon Mobil.

Roger M. Groves is a Professor of Law at Florida Coastal School of Law, teaching business and sports courses and director of The Center for Sports and Social Entrepreneurship. Follow him at Twitter@rgroveslaw.

Michigan State’s Draymond Green Is Exhibit A to Why Most Players Should Stay in College

Every season there are a handful of college basketball players with impressive awards and statistics. This season Michigan State’s Draymond Green is one of them. He is a Sporting News First Team All-American, and Player of the Year in the Big Ten Conference. He led his team to the conference championship, and was that tournament’s Most Outstanding Player. He has more double-doubles (10 or more points and rebounds) than most players in recent history. Over his career, Green has scored over 1,000 points and may become MSU’s leading rebounder. And he often led the team in assists and/or blocked shots. In fact, I am about to unveil a new statistical category for the most positive impact of a player’s cumulative offense and defense, called a positive versatility index (“PVI”). I may as well name it after Green.

But that is not what makes him worthy of special mention. We now live in an era where great college players stay a year or two and move on to the NBA. Two of this year’s 1^st Team All Americans are Kentucky’s Anthony Davis, a teenage freshman, and Ohio State’s Jared Sullinger, a sophomore. If they move on, I’m not mad at them. They have been in training for that profession since puberty. Before becoming McDonald’s High School All Americans, they were already plucked from ordinary childhood and beamed around the country to play with other future All Americans through their corporate and quasi-corporate sponsors – like Nike and the AAU. I bet some amass more frequent flyer miles by age 17 than business execs get by 50. I wish them well just as I would a Beethoven-playing child prodigy pianist who leaves college after a year to perform in a profession that also does not require a college degree for entry.

But most college players are not quite “prodigies” destined at 19 years old to be first round draft picks with guaranteed multi-million dollar incomes. As MSU coach Tom Izzo said, Green was a “very good” high school player, “but didn't have a lot of hype surrounding him or lofty expectations from the outside.” Izzo recently reflected, “But he's done what a four-year player is supposed to do, and that's to get better each and every year.” And shouldn’t we all. From a fan’s standpoint, it has been good to see. It reminds me of what a college mission should be, to help all of its students get better every year. For the non-prodigies, and that is everyone except that less-than-one-percent, let’s hope our institutions retain that focus despite the lure of big time revenue from the less frequently found high flyers.

Green is one of those worthy of honorable mention here because over his four years, he has evolved in a way he could not have if he was beamed to professional sports after a year’s taste of college. If he had left too soon, he would not have had as much time to face team adversity and grow from it. One challenge was physical. He came to MSU with pancake pudginess, not quite ready for prime time. With inspired suggestions from coach and team, he worked his way into playing shape and beyond, logging more minutes than most and looking the part of the All American he has become.

More challenging was the conflicts among media and teammates. In his junior year, the media made him the team’s poster child. The problem was that Kalen Lucas and Durrell Summers were already stars - stars that led the team to two final fours. They or others must have reminded him, “No matter what sportscasters say, the two stars are over here, and you’re over there”. That is a part of the media’s nebulous reference to a lack of chemistry about last year’s team. Draymond must have felt awkward by being touted as the leader over the very people he looking up to. But from that fire, the metal in his character was forged. Now he can speak from personal experience when he uses the familiar phrase, “If it doesn’t kill you it makes you stronger”.

Then there is emotional maturity that can come from the college experience. It is not fashionable among the coolest teenagers to say, “I love my coach”. Green unapologetically espouses a love for not only his coach, but his school, his teammates, and the fans. But he may not have said that during his freshman year. Draymond admitted on the conference’s network, BTN, after the tournament championship that Coach Izzo had to straighten him out on occasions over the years. Green said he had good tutelage growing up, which led him to think he already knew how he wanted to play the game before he came to MSU. But he learned to take instruction, and grow thereby. If he left too soon, he would have missed that life lesson.

If he had left too soon, he would have missed the chance to earn the leadership role from his peers. Due in part to the earlier internal discord, the team underperformed last year and was unranked entering this season. I suspect Draymond will say last year was a challenge. He would also say that entering this season without co-senior and important starting forward Delvon Roe was a challenge. He would also admit that playing the toughest schedule in the country this year was a challenge. So being a leader under those circumstances too was a challenge, albeit a challenge he would not have faced if he had left too soon. According to his coach who has seen many, Green is among the best, and a coach on the court with a rare knowledge of the game.

And over the past four years, Green has had a chance to realize and appreciate humility. The test of whether one has it is often clearer if someone is already a star. Indeed, for two years now, Green has been one of the most publically adored college players in America. All the temptation one needed to get the “big head” was swirling around his. Yet when he had two straight tournament games of poor shooting, he said, “My guys picked me up the last two games”. When sitting on the stage for a network interview after being named the Most Outstanding Player, he said, “I don’t know why I am up here. My teammates should be up here.” What I think he will realize too is that his humility is not only good for his team. It’s good for his blood pressure.

So it was only fitting that with about a minute left in the game, Draymond faced yet another level of adversity. The game was hanging in the balance and he had the ball in his hands. He had taken 14 shots but only made 3. A few minutes before, he banged his head on the floor attempting to unselfishly take a charge. He was admittedly stunned, woozy and had lost track of what was happening on the court. Yet now the conference championship was at stake. He was already on record nationally for saying he wanted this team to leave a legacy footprint for the program. Against these odds and self-imposed pressure he had to decide whether to risk taking the shot. It could lead to victory or be the cause of defeat. He took the shot.

His character, emotional maturity, earned leadership, and his having faced adversity over his four year career all came together at that moment. As if a reward for the experience, he made his 15^th shot of the day, the last shot of his conference career. Four year fairy tales can come true. He was a hero to everyone except himself, as it should be. If Draymond had left too soon, he would not have authored this lifetime memory. He would not have had the tale to share with his coach, his teammates, and those of us who are fans of college basketball.

Now MSU enters the NCAA tournament as a lofty number one seed on the biggest stage in college basketball. They may not win a national championship, but they have the experiences befitting one. Those experiences include the four year career of Draymond Green. I hope other non-prodigy players will take note and follow his lead.

Roger M. Groves is a Professor of Law at Florida Coastal School of Law, teaching business and sports courses and director of The Center for Sports and Social Entrepreneurship. Follow Roger at Twitter@rgroveslaw.