College Basketball GM State of the Union

Part II: Winning on the Margins

Hello again. Thank you for such a positive early response to the College Basketball GM State of the Union series.

I am doing my best to complete this series within a reasonable timeframe and will likely consolidate it into one comprehensive treatise when it is all said and done.

Enough of the logistical details; earlier this week, we discussed the impracticabilities that have prevented multiyear deals from being implemented at large. Now, we will examine how teams are strategizing to gain an upper hand.

At any high level of athletic competition, wins and losses are decided by minor differences in scheme, preparation, and skill. With talent increasingly concentrating at the top, exploiting even small strategic advantages can be enough to move from a bubble team to a ranked program.

Quickly, I found that winning on the margins for many programs hasn’t changed much. Prep recruiting has always been important, but now, these players are crucial to the success of every program.

Why?

As a broad trend, high-major basketball has moved towards portal recruiting. When projecting on-court contributions, transfer athletes come with a much narrower variance in their production floors. With more film and more reps against collegiate competition, the investment in a transfer athlete (who has seen the court) can be pricey, but it also provides a reasonable expectation of contributing significant value and usage.

Philosophies within high-major teams are split when it comes to transfers. Many schools pursue players with all-conference accolades from low- and mid-major conferences, viewing conferences like the Horizon League, OVC, and MAAC as a feeder system to high-major competition. In many cases, high school players can be under-scouted or poorly evaluated, but they may develop well in their first season or two of college, presenting an opportunity for many programs to bolster their rosters with players developed elsewhere and on someone else’s dollar.

Athletes like Yaxel Lendeborg (Michigan), Donovan Dent (UCLA), and PJ Haggerty (KSU) in this year’s college basketball transfer class are receiving multi-million dollar contracts, keeping them in college and away from the second round of the NBA Draft. While those numbers eat up a significant percentage of a team’s total budget, there is only a finite number of players in any given year that can be confidently projected to deliver such a high level of production.

Demand for these players is high, and bidding wars often lead to significant investments from teams. Some schools will not entertain elite low- and mid-major transfer prospects unless their production against top competition in non-conference play is prolific, hedging against the volatility of a jump in competition level, and ensuring that an athlete will be ready to contribute from the moment they step foot on campus.

As we will see with other concepts, risk aversion for GMs is highest when players consume a significant portion of a team's budget — this is intuitive, but surprisingly not always adhered to. In the past, recruiting with scholarships and, even more so, with limitless NIL from 2021-2025, was sometimes more emotional than logical. In my opinion, that mindset won’t age well.

Instead of highly touted transfers, some teams opt to invest top dollars in ready-made high school prospects at the highest tier of the prep rankings. Sure-fire prospects like A.J. Dybantsa (BYU), Nate Ament (Tennessee), and 2026 prospect Jackson Crowe (Missouri) have all been linked to seven-figure compensation packages. Like top-transfer talent, these athletes have tools so undeniable at the high school level that they can also command hefty compensation.

Many programs and coaches are becoming increasingly wary of handing over the keys to a player who has yet to hit their 20^th birthday. If a coach/GM is to give away 25% or more of their payroll to an athlete, having high-major experience, let alone Division I experience, is becoming increasingly necessary. While generational prospects like Cooper Flagg held a relatively high floor, that is far from the norm — many GMs do not feel comfortable extending those offers beyond exceptional circumstances.

The risk tolerance for freshmen unproven at the collegiate level is shrinking. If you have to invest, choosing the option with lower variance feels most prudent. The lack of experience has caused freshmen to become relatively inexpensive compared to quality transfers with high-major production or mid-major conference awards.

As we mentioned in Part I: Multiyear Contracts and Buyouts, the common consensus is that players are year-to-year, and with that assumption, there is no grace period for acclimation. Players earning significant compensation are expected to make an immediate impact. With a sea of talent available every offseason and the range of spending narrowing amongst top programs, high-major college basketball is becoming increasingly win now.

To win now, certain things are evident: depth is crucial to basketball performance. This is where prep recruiting comes in. Even as a minority of programs have abandoned prep recruiting altogether, many now see it as an avenue that could prove to be a major differentiator.

The most sought-after high school prospects demand compensation that can rival proven high-major transfers. Beyond the five- and high four-star prospects, undervalued recruits provide massive upside for programs with relatively light investment. High-school rankings are a great predictor of a player's first-year earning ability; however, they are often a less reliable predictor of collegiate production. Finding diamonds in the rough, in an incredibly top-heavy market, can give depth to a program at a cheap price.
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Here are the top-35 freshmen on high-major teams who played a minimum of 16 minutes per game (avg.), ranked by BartTorvik’s PRPG! compared to their 247 composite rank.

For the athletes highlighted in green, this is often where we see high-major teams implementing multiyear deals. As previously discussed, for prep prospects that teams believe in and feel are being under-scouted, they can demonstrate good faith to the athlete (and their agent) by offering guaranteed two-year compensation packages.

As high-major teams get older and more experienced, programs increasingly cannot provide an expectation of playing time to freshmen. A multiyear contract allows a grace period to come in and grow in the program without the financial pressures of contributing right away.

For high-majors, recruiting freshmen on multiyear deals allows for a commitment to development, the ability to mitigate risk on high upside athletes, the potential to lock a high usage player to a team-friendly deal (if only for a year), and generate greater roster continuity.

Players who exceed expectations will provide value on cheap deals while freeing up budget space for teams to spend, or even overspend, on their desired transfer talent or blue-chip freshman prospects. Prep recruits who don’t pan out in a two-year window won’t be a massive financial burden to a budget.

All schools want to improve their ability to beat the prep rankings, but the approach is handled differently from program to program. Some are bolstering investment in front-office personnel who focus on analytics, for others, it involves relying on savvy coaches with a knack for recruiting undervalued athletes or identifying players within their region with less visibility.

As seen above, several teams hit big on freshman recruits, including Jase Richardson (Michigan State), Jeremiah Fears (Oklahoma), Christian Anderson (Texas Tech), Thomas Sober (Georgetown), Jeremiah Wilkinson (Cal), and CJ Cox (Purdue).

Cox is a reminder that no one has been more effective at winning on the margins than Purdue’s Matt Painter. For two decades, his program has thrived by identifying undervalued recruits and developing them into stars. In the new era of revenue sharing, that skillset isn’t antiquated; it’s actually more valuable than ever. In Part III: Different Schools, Different Builds, we’ll dive deeper into Painter’s enduring philosophy and why it has made Purdue the Big Ten’s winningest program before and after the implementation of NIL.

Stay tuned.

Noah Henderson is the Director of the Sport Management Program and a Clinical Instructor at Loyola University Chicago’s Quinlan School of Business. His work explores the intersection of law, economics, and the social consequences of college athletics, particularly in the areas of name, image, and likeness (NIL), athlete labor rights, and sports gambling.

Henderson helped amend Illinois’ NIL legislation and played a direct role in establishing early frameworks that facilitated the legal payment of college athletes at Student Athlete NIL. He continues to advise athletic departments, brands, and sports agents nationwide on NIL policy, legal compliance, and best practices.

He contributed extensively to Sports Illustrated’s NIL Daily, where his reporting and commentary helped shape public understanding of the evolving business of college athletics. His insights have been featured by ESPN, NPR, CNN, PBS, Sportico, the Chicago Tribune, and others.

Henderson holds a Juris Doctor from the University of Illinois College of Law and a degree in Economics from Saint Joseph’s University, where he was a four-year letter winner on the golf team.