Lottery picks are not stupid, and neither are their parents, AAU coaches, handlers, and whoever else might be involved in the agent selection process.  In most circumstances, agents for lottery picks do not make a dime off of the initial contract.  The first time they will make commission on a team deal will be in the second contract, which will be very lucrative for those rookies who outperform the competition.  If the contractual agent is not also acting as the marketing agent for the player, that means that the agent will be working pro bono for quite some time.  To make matters worse, other agents will be hawking at your lottery pick client nonstop.  If the client leaves you, you may lose quite a lot of money and time over this kid who was supposed to be “The One” to bring your agency to the top.

Recruiting money is never paid back, but often times, lottery picks will basically pay back the costs of workouts and travel expenses that the agent incurred in the pre-draft process.  You can call that a commission on the first contract, if you’d like.  Rovell is correct, most agents who represent lottery picks actually lose money…their hope is that long-term, these athletes end up paying for themselves and much more.

“The sports agent business has become so corrupt — I would not encourage anyone to try to become an agent right now.”

– Legendary NBA agent David Falk (WSJ.com, 4/22).

Is Falk jealous of the new crop of agents’ successes? Or does he present a realistic view of the current climate of athlete representation?