Sometimes, a bird in the hand isn't worth anywhere near two in the bush. In September, the University of Washington School of Business struck a $50 million deal with a family foundation to rebrand itself the Michael G. Foster School of Business at the University of Washington, honoring its largest donor. But as precious a commodity as a school's name may be, it could prove far more valuable unsold.

In October, the University of Wisconsin School of Business announced that about a dozen alumni had donated a total of $85 million to keep it from selling its name for the next 20 years. In the months since, the value of the school's name has already appreciated by about $2 million, according to the calculations of Dean Mike Knetter. It took Knetter two years of smooth talking to convince alumni that cash donations remained even more valuable without naming rights. In 2005, he sent them a proposal that included a mathematical proof (first line: "Let x be the value of the naming gift") demonstrating that naming gifts have increased in value at an average of about 8 percent annually, which could make a $55 million gift in 2007 worth some $250 million by 2027.

"This was the most strategically sound way to proceed," says one alumnus and donor, Ted Kellner, chairman and C.E.O. of Fiduciary Management. There are clear side benefits: The school avoids a costly rebranding campaign and keeps attracting big donors who might otherwise be turned off by an exclusive naming deal. "When you choose one, you probably lose a $5 million gift from each of the others," Knetter explains.