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Sponsorships can seem like an easy way for a team or sports superstar to get the money they need. However, sponsorships can come with a whole bunch of different rules and regulations to keep in mind. By going against these rules, you can end up losing all of the money you made from your sponsorships. Make sure you keep these rules in mind before signing your first sponsorship.


Non-Compete Clause


Many sponsorships come with a non-compete clause. This makes it so that you can’t take multiple sponsorships with companies based in the same industry. Businesses do this as they don’t want to sponsor someone who is marketing their direct competitor.


To avoid this, make sure that you ask whoever is sponsoring you on their list of banned businesses to work with. If a business isn’t on the list, make sure that you ask them if it’s ok first as you don’t want to end up in a situation where a sponsor quickly drops you. Ensure that you fully understand non-compete clauses before signing your first sponsorship.




In the world of business, someone who might be sponsoring you could easily get grabbed by another company so your sponsorship changes names. Depending on the contract though, that business might drop you when they find out they don’t have to keep their end of the new bargain. To fix this, you should add a merging clause in your contract.


With this merging clause, you can make it so that businesses always need to pay out even if they get bought by someone else and have the business name changed. Just make sure that you get on good terms with whoever buys that business so you can have your sponsorship extended in the future. Make sure that you always have a merging clause in your sponsorship contracts.




The last and most important point is the financials. This means finding out what qualifies you for payments and how often are you going to get a payment from a company. All of this should be outlined in your contracts.


By having your financials outlined in a contract, a business can’t rip you off from a sponsorship without you being able to sue them. This means that you’ll also be able to easily plan the financials of you or your team since you know exactly how much money you’ll be getting. Always take care of the financials when creating a sponsorship contract.