For our 18th episode, President & CCO Ethan Whitehill chats with Jim Carr, President and CEO of NAIA, about the business of college athletics, the rise of emerging sports, and a new resource designed to maximize a schools’ Return on Athletics.
Ethan Whitehill: Hi, everyone. I’m Ethan Whitehill, president and chief creative officer of Crux, the “un-agency.” This is “To the Point,” our monthly podcast for thought-provoking conversations that get to the crux of it all to help businesses elevate their brands and amplify their missions. Today’s guest is Jim Carr. Jim is the president and CEO of the National Association of Intercollegiate Athletics, or NAIA. Jim joined the NAIA in 1998 as managing director and general counsel and was promoted to chief operating officer in 2000. In September 2006, he became the association’s seventh president and CEO before joining the NAIA.
Jim practiced law with the firm of Maynard Cooper & Gale in Birmingham, where his primary areas of practice were public finance, corporate and intellectual property. He previously worked in the athletics development office and served as director of licensing at the University of Nevada, Las Vegas. Jim obtained a BBA in business administration from Millsaps College where he was named to the Athletic Hall of Fame in 2011. He earned his MS in sports management from the University of Massachusetts Amherst and was named Alumnus of the Year in 2009. He completed his JD at Duke University and received an honorary doctorate from Webster International University in 2014.
His board service includes stints with USA Basketball, Kansas City Life and the National Association of Collegiate Esports. That’s an amazing resume, Jim.
Jim Carr: I hope I didn’t send that over. That’s kind of long, but I appreciate you.
Ethan Whitehill: Putting all that out there. It’s an honor to have you on our podcast and I want to start with this question for folks who really don’t know. What is the NAIA?
Jim Carr: NAIA stands for National Association of Intercollegiate Athletics. We’re one of several governing bodies for intercollegiate athletics in the United States. There’s the NCAA, which a lot of people know of, and the National Junior College Association, which works with two-year institutions. We have about 250 colleges and universities across the country, mostly smaller private institutions but we take athletics very seriously and run robust athletics programs. We provide championships, we provide things to get students eligible, a lot of marketing, branding, getting the word out. And then a lot of other initiatives that I’m sure we’ll get into later.
If you’re in Kansas City, you probably know us as a basketball championship. In fact, the NAIA started as a basketball championship in 1937. James Nasmith, among others, started it at Municipal Auditorium. They wanted a basketball tournament there, and it grew from that one tournament to now 31 championship sports around the country.
Ethan Whitehill: I was impressed to learn that NAIA represents 250 schools across 21 conferences. What type of school do you serve and how is NAIA different from the NCAA?
Jim Carr: Different in a lot of ways. We first start with the kinds of schools. Our average enrollment is around 1,800. We’re about 80% private institutions, about 20% public institutions geographically, primarily in the Midwest and Southeast, plus a lot of schools out west. That’s kind of the breakdown of it.
The conferences work just like the Big 12 or the SEC would work, and although ours are much more geographically centered than those conferences are now that spread across the country, they come together mostly for competition but also to do some things together outside of competition.
Ethan Whitehill: I understand that NAIA is a champion of some emerging non-traditional sports. So, it’s not just basketball that we know it well for, but women’s flag, Esports. What is your organization investing in these areas?
Jim Carr: We think about this a lot at the national office. Our schools tell us it’s important to them. Athletics does so much on these small campuses. They’s a driver for enrollment. Some of our schools have more than 50% of their students who are also athletes. So, a big part of that engine is also imported from a financial perspective because those students bring in not only tuition revenue but room and board and lots of other things. They help with donations, drive the economic engine and also change just what people think of for college sports in general. It’s a great way for people to rally around the institution and to to be a part of something bigger than themselves.
Ethan Whitehill: Beyond athletics, you mentioned a couple of the benefits that come from an NAIA relationship and sports in general within those schools. Tell our listeners a bit about how those services work and how you facilitate that.
Jim Carr: One of the biggest services we provide is initial eligibility. We call it NAIA Elgibility Center. Any first time NAIA student has to come through our eligibility center. What we’ve found with providing that service is it gives us a great opportunity to also promote many opportunities for student athletes across those 250 institutions. So, we partner with the National Federation of High Schools and the various state activities associations. We partner with a company called NCSA, which is the biggest private recruiting service for high school students who are wanting to play in college. And I could go on and on about the different entities that are our partners, but it’s become a really good marketing engine for not only NAIA as an association but for our individual members to get the word out to those prospective students.
We also have something called Return on Athletics. And I know you’re familiar with this because you all are helping us with a new initiative within Return on Athletics, but that’s designed to help with some of the things I mentioned before, which are the different ways that our schools are looking for athletics to positively impact the campus. It’s obviously a play on return on investment, but it’s what return does the institution want to get from athletics and how can the NAIA both provide data but also do things to help drive that.
Ethan Whitehill: I want to go back in time a little bit. When you joined the NAIA, things were a little different. They looked different. How have they changed? A lots changed in the world.
Jim Carr: Yeah, things have changed dramatically. You mentioned in my bio that I’m on the board for the National Association of Collegiate eSports. We started that association back in 2016. It’s grown from six institutions at that point to more than 250. They play their traditional sports and NAIA, but a lot of them in NCAA. So I never thought 25 years ago that I would be serving on the board and essentially the NAIA would own and run Esports association.
You mentioned flag football. Women’s sports have grown dramatically. In the 1990s there were lots of opportunities for women already, but flag football, we now have women’s wrestling. We have a number of sports that I just think back in the late nineties nobody thought would be opportunities for women.
There are certain issues that are hot button topics right now around transgender students and if they should and how they should participate in sport. That certainly was not on our radar back in 1998. So, just the changing landscape.
I guess the last one I would mention is really an impetus for a lot of the things we’ve already talked about and the things I’m sure we’ll talk about – the focus of the NAIA and just how higher ed has changed and our schools in particular. Small private schools are just under a lot of pressure these days. The economics of it, the finances and then just schools having to almost prove on a daily basis that education and what people are willing to pay for has value, and we’ll continue on and in a great way.
Ethan Whitehill: Let’s follow that line of thought and just talk about what is the future of higher education as NAIA sees it.
Jim Carr: If I had the answer to that, I’d probably be doing something different and making a lot of money by consulting with schools. But as I think about it, the one thing that people know is that it’s changing much more rapidly than it used to. Higher ed is known for moving pretty slowly, but we’re seeing institutions come together at a much more accelerated pace. We’re seeing, unfortunately, some go out of business.
I think it’s safe to say every school except maybe very selective institutions – the Ivy Leagues and some of the others that are very selective – are really assessing their business models and trying to figure out if they can be viable and thrive in this environment. Most of them are concluding that they think they can, but then the question becomes: how do we do that?
Ethan Whitehill: I know your organization thinks beyond just school success. You think about student success looks like, right? And you actually provide a lot of scholarships. Talk a little bit about how you’re connected to the schools and then the students within those schools.
Jim Carr: We have 83,000 student athletes across those 250 institutions, probably roughly half a million students in total at those schools. And the schools are the ones who actually provide the scholarships and collectively. By our last count about a year ago, there was about $1.2 billion in athletic scholarships. So, there’s a lot of money available to students who are good athletes who also want to get a great education, and that’s what our schools provide. We do have some limits for competitive purposes for each team and how many scholarships they can give, but for the most part we’re trying to help our schools figure out how to provide as many scholarships as possible so that students can absorb the rising cost of education.
Ethan Whitehill: Beyond Esports and flag football – to me that’s an amazing opportunity to diversify your offering as an athletics department within a school. What else are schools looking at?
Jim Carr: I believe in this philosophy that’s shared by a lot of our schools is that at smaller institutions people want to go there to do things, and it’s not all just about athletics. It could be theater or some things in music, but they have an opportunity to really be engaged and do things as opposed to going to watch a basketball game at KU. What we’re trying to do is help schools figure out what those opportunities are. So, in addition to what we talked about before with Esports, our schools are looking at all kinds of things. A lot of them are starting marching bands, and schools are even looking at shooting sports and they’re looking at anything that is popular out there.
I think offline we talked a little bit about pickleball. I’ve had probably half a dozen presidents in the last month mention to me that they’re building pickleball courts on campus. Now, there’s no varsity pickleball opportunity at this point, but five years ago there was no varsity women’s flag football opportunity either. So, we’re trying to find some partners who can help ramp that up for us. But I would predict in the next five to 10 years you’ll see NAIA pickleball.
Ethan Whitehill: I’ll have to run my name through your eligibility check just to see if I can actually play that because that would be amazing.
Jim Carr: I’m trying to learn myself, but it used to be viewed as a sport that was mostly for people our age, but now it’s the rage everywhere.
Ethan Whitehill: I want to go back to something else. You mentioned earlier Return on Athletics and that platform that you provide schools. How had schools traditionally looked at the return on their athletics programs and how does this change it for them?
Jim Carr: Pretty early on in my 25 years at NAIA, I was scratching my head a lot when I would talk to presidents of our institutions. On one hand, I would say we’re building out athletics because it’s a great way to get kids on the campus, but then I would talk to other presidents who would say we’re having to drop these sports because we can’t afford it. It’s too expensive and too high of a cost. The third element to it is from presidents who would come from larger institutions, let’s just use the ones close to us. You know, if someone came in from a place like University of Kansas to go to Kansas Wesleyan, they would say, “Well, I guess I just run athletics like I saw at KU but do it on a smaller scale.” And I intuitively knew that was not a good recipe because they’re just so vastly different. Kansas Wesleyan, for example, does not have the donor base and they don’t have the sponsorship opportunities. They don’t have a conference that’s going to pay them tens of millions of dollars a year for media rights.
Put all those conversations together to say we need to help these leaders on campuses understand how athletics work at a small institution and then how they should be thinking about what drives it on campus and how we want to come at it. So, we created Return on Athletics about six or seven years ago. Right now, we have four years of longitudinal data from every one of our student athletes at every one of our schools. The first thing is we now have this robust dataset that our members can tap into and compare themselves to – really almost anyway they want to slice it and dice it across the country to understand: are they using scholarships in a similar way? How’s retention look for them compared to others? I could go on and on about all the different data points, but that’s really become something that our schools find valuable.
What we’re now adding to that are things like research briefs that talk about the use of junior varsity sports and the roster sizes and how its impact might have on retention rates. It was something that most ADs and coaches can get into their jobs. They’re passionate about figuring out how it helps the business of the institution. If we’re not helping our schools do that, then they may not be around in 20 years.
Ethan Whitehill: I’ve seen some compelling numbers on what that return can look like when they do it right. It was $10,000 per student athlete in net revenue. Is that right?
Jim Carr: That’s right, and some of our schools are generating a net revenue of four to $5 million from athletics with very little in the way of sponsorship or even donor dollars coming in. So, it’s important that the schools that are doing it right are making some money and they’re very competitive at the same time.
Ethan Whitehill: Good numbers to know. Beyond yards right after reception and all that, let’s talk about the dollars, right?
Jim Carr: I’m pleased to see that some of our athletics directors are really coming around on it too. They always say they’re kind of in the middle of all this because they have an administration that’s saying we have to do this in a financially responsible way. We have to use it to help drive enrollment. But then their coaches are saying to them, “I need more money for recruiting and I need to give more scholarships. We need better facilities.” All the cost center of it all. So, the AD needs this data to be able to figure out where they need to be.
Ethan Whitehill: One thing I want to talk about, because you mentioned it earlier, is just NAIA in Kansas City because to me, it’s one of those near and dear institutions that most Kansas Citians are aware of. And it’s not just because of the HQ but it’s because of the basketball tournament, like you mentioned. What makes our city the right place for your organization?
Jim Carr: I would start with, it’s our original home, and the great history that’s here. Not only James Nasmith being a part of starting one of the first events at Municipal Auditorium, but we also have great history of John Wooden essentially breaking the color barrier in college basketball by having an African American student athlete on his team in the late 1940s. So many great games at Municipal and even for a while we were at Kemper and when I first joined the NAIA, we were actually in Tulsa, Oklahoma. There was an eight year period where we weren’t in Kansas City, and I always liked people in Kansas City to know I was not a part of taking the organization to Tulsa, but I was a part of bringing it back. So, I was on the right side of that one.
I think it helped the organization understand what we were taking for granted in Kansas City and that is people who love the organization, people who appreciate the history, people who come back year in and year out to the basketball tournament. I’ve been here since 2001. It’s just a great place to raise a family and bring in employees and do all those kinds of things. But the support for the NAIA and the people who care about it – we couldn’t find that elsewhere.
Ethan Whitehill: This is my mystery question. I have a list of 20 questions. I’m going to roll this and it looks like question number 16 is what we got here. Oh, this is a good question. What is your favorite question?
Jim Carr: Oh my goodness. I would say outside of settings like this, I love when people ask me about my kids because I love to talk about my kids. So, “What are your kids up to?” Or “Tell me about your kids!” would probably be my favorite question that I get.
Ethan Whitehill: I love that answer. How can listeners connect with you to learn more about NAIA in general?
Jim Carr: I think the best way is our website naia.org. Any of us on the staff that show up on the website love to help out folks in the community and people in our membership as well. But we love to talk with people, so if you have questions or just want to connect with us, send us an email or give us a call.
Ethan Whitehill: Perfect. Thank you, Jim.
Jim Carr: Thank you.