There is value in your name, image, reputation and goodwill (also known legally as name, image and likeness or “NIL”). But you don’t know how much value until a valuation is performed. The underlying concept is also used in the housing market. A house is not usually bought or sold until there is an appraisal. That appraisal uses well-established methods of valuation to assign a market value to the property. The seller does not have a fully marketable value until the valuation shows a number. Only then does he or she have a good basis for saying, “I’ll sell you this house for $300,000.”
Though the house is tangible real property, the same principle exists for intangible property like your NIL. You want a 5-year endorsement deal with a show company. You don’t have a fully developed sense of the value of your NIL to start the negotiation until a valuation gives you a market value.
It is important to distinguish between an overall NIL valuation and the monetization of a name in social media. The monetization is essentially money made as of a particular time (e.g.adding up total dollars from ads on a website). A valuation examines current revenue plus the future income potential from all sources of NIL value, not just one item. Then the valuation assigns an overall present value in contemplation of those future income streams. In other words, your present NIL includes the reasonable income potential. That is really no different than saying “I will pay more for a house in an appreciating neighborhood than the identical house in a declining neighborhood.”
In sports, the NIL of a player who just finished his rookie season with the running title on a Super Bowl winning team will likely be higher than another rookie with the same stats who just an career-threatening knee injury.
Valuations of intangible assets, like NIL or trademarked logos or patents, are important because they are assets and part of your net worth. Your assets are recognized in the banking world as “collateral” for loans. The more secure a lender feels about your ability to repay a loan, the greater your chances of getting the loan, with a more favorable interest rate, which reduces your overall cost over the life of the loan. If your NIL can become part of your assets and be “collateralized” you can gain the benefits described above.
These are sophisticated principles used by large corporate entities to establish appreciating assets, value, and worth. The assets are leveraged in negotiating borrowing power. With proper guidance, you and business you create can do the same.
IF you are interested in gaining the above benefits from a valuation of your NIL, complete the form below. We will get back to you for further discussion.