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Just thought I’d put that in the forum so everyone is aware it’s not the standard 10%. Please let me know if my math is wrong and I’ll delete. That extension idea for rake would be awesome.

Yeah but it would be BSPN, yuck

Only 100 people? Do you think you need 100 people everyday to run a site like FD?

Kill the industry? Probably not but if you go to 5% you literally cut their main revenue stream in half, nobody in their right mind would consider doing that.

Most importantly, keep in mind that a) these sites have large investors they have to keep happy as well as trying to draw in new investors and b) FanDuel especially is most likely prepping for an IPO. They are going to want to have the best looking financials possible ready for that so for that so every couple of % rake here and there is gonna add up nicely on that bottom line.

Good points

My point is the sharks are already eating the sharks because the rake is too high and the soft money goes broke too quickly.

There is a balance somewhere between having a high enough rake to recruit new players through advertising and low enough so amateurs(maybe me) don’t go broke too quickly and quit. I don’t think 10-12% is it

Sorry to hijack this thread with all my posts

I think this reply is probably accurate. When we pay the rake we aren’t paying to sustain profits for fanduel we’re paying for their overadvertising and upcoming IPO figures.

I suppose it wasn’t fair to take a pot shot at you. It does appear that your results are GPP. I guess the point I was making wasn’t as much about you, as it was the average rake conscious player. Sure, I would love to have lower rake but I’m also willing to pay a little more for a wider variety of opponents.

If rake was my only concern, I would just save up all my money and play a $5300 h2h. That gets me $5000 in action for only $300 in rake. In order to get that same $5000 in play at lower stakes I have to pay at least $500 in rake. I guess what I am saying is the $200 in savings on rake isn’t as important as finding a variety of opponents. There is a reason people play on the bigger sites. If you can find enough action on smaller sites and the rake is less, absolutely go play there, and it appears you are. It just seems to me that you are pretty good at FanDuel (at least GPP) so I don’t get why it would be hard for you to build a top 50% lineup and crush cash games.

I’m curious, what do you think?

That’s why I jumped out of cash. More variation in GPPs, but obviously bigger upside/downside swings.

The only thing that can bring rakes down is market pressure. If ESPN wants to come into the game and raid DK and FD’s player base, they can do it by simply offering 5% rake.

A big boy like ESPN or Yahoo will be able to afford smaller rakes than DK or FD since there will be a lot of synergy between their existing operations (websites, fantasy sites, player projections, marketing teams, servers, programmers etc.) and their new DFS sites. Thus their startup costs will be a lot smaller. Additionally, they can afford to lose money in the short term a lot more than these other sites.

Possibly, but poker is a pretty profitable industry that manages to run a ton of ads (or used to pre-black friday) and manages to get by with 5% (or less) rake with much better player rewards programs. DFS players are getting swindled.

Poker tournaments are raked more than 5%. I remember them being $10+1, $100+9, $200+15, etc. Also, the economics aren’t even close. Fanduel’s revenue was under $60M in 2014 whereas Pokerstar’s was estimated at $1.4B in 2010.

• Poker runs 24/7. DFS is dependent upon sports schedules and only has a small daily window.
• There’s more costs to run a DFS site. Stat feeds aren’t free and they have to update salaries everyday. You can’t just set the rules and run the program over and over thousands of times a day the way you can with poker.
• DFS is not really global. Poker is accessible to a much wider audience.

All in all, there’s way more $$ in poker

I’d love to see a rake reduction as well, but I don’t see it happening anytime soon.

The tournaments on Pokerstars were raked 10% or less (I played mostly $12 +1 Sngs) and the cash games in poker compared to the cash games on fanduel were much much much less, at worst half the rake of fanduel cash games. Plus the rewards were light years better.

Maybe there are some extra costs compared to a poker site, but like someone said earlier they took in 186k in rake on just some of todays NBA offerings. I will gladly monitor stat feeds and update salaries every day for them like a champion for 186k.

Anyway, I don’t enjoy NBA anymore. I can’t stand the syndicates flooding 50/50s with the same lineup so that a 3 pointer instantly drops you from 9th to 26th in 40 man 50/50s, and I also question how players with 12 wins can form a lineup so similar to those with 10k plus wins. Think I’ll let you guys fight it out and I’ll see you when football comes back around.

Yea, it’s a combination of less rake and better rakeback/rewards programs. Stat feeds aren’t free but they scale incredibly well. Same goes for salary updates which are generally automated anyways.

I haven’t seen any net loss/profit news from Fanduel but I bet that given their huge growth in revenue its pretty good even with all the advertising they buy.

The rake was heading north in tournaments and everyone seemed ok with it except for a few people who complained. Those people who I won’t name were told “the sites need the $$ for advertising.” Now that the players have been groomed to accept 12% + rake it is slowly starting to trickle into the cash game contests. This is standard practice for big companies. Eventually all contests will be 12%+ rake.

+1

To whomever made the revenue comparison to poker: that’s irrelevant. Profit margin is what’s relevant, not revenue.

They are both relevant. Are DFS sites even making a profit yet? Poker Stars had margins around 40%. I don’t think any DFS site is getting that. And lowering the rake doesn’t increase the sites’ margins. All this supports higher rake, rather than lower rake.

This is silly. Did online poker launch with 5% rake and rake back and tons of ads and rewards?

We’re they located in the US? Did they market through major sports leagues (in the early years)?

DFS players aren’t getting swindled. You can argue that the rake isn’t sustainable. But the greed argument is ignorant and tired.

I think you are wrong here. It is greedy to rake greater than 10%( which is already too high) on the cash game stye games. These are the games where the majority of your everyday players play in order to maintain a bankroll to keep paying rake the following days. There is no reason to soak these players with extra rake when you know as long as they have money they will keep playing.

This is a joke. Fine, push rake above 10% in some tournies. I refuse to pay 10%+ in cash games and everyone else should as well. It’s the principle of the matter. I have yet to receive a good answer from FD as to why these are now being raked at 12-14%.

But like everyone else, you will continue to play there and pay the rake. Until your money does the talking, they won’t change. So it is a joke, why do you continue to play there?

Because their other contests aren’t raked at over 10%.

Yeah, but you said you aren’t playing in those games with 10%> rake, but you are.

A lot of players pay no attention to rake whatsoever. Players need to create an advocacy group that can help educate players and can also put pressure on the sites. Among a lot of other (positive) things.

The bonus program is shit.

Sucks that they’re making so much off rake and not showing any love to players firing everyday