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  • cedric19

    11.9% to 12.9%, matching Fanduel’s increases. Contemplating sitting it all out until football season

  • deejones49

    I think a start up will come along after all the regulation with lower rake and force the big boys to lower rake

  • noddy

    $1 and $3 double ups tomorrow out of 114 now. Did they lower it?

  • cedric19

    @noddy said...

    Has rake been going up at the smaller sites like Aces, Feud, and Fantasy Draft also? Or is it just DK right now?

    The thing that makes me hesitant about those smaller sites is the playing field. Even if there was no rake there if I was constantly going up against a small playing field of 90% pros it would be worse than 13% rake at DK

  • xatewatr

    The rake is up to 15% for the upcoming UFC 200 $100K Haymaker…

  • cedric19

    @laggard said...

    The rake is up to 15% for the upcoming UFC 200 $100K Haymaker…

    Just to illustrate how oppressive 15% rake is…

    Betting the 30 to 1 snake eyes bet at craps is a slightly better bet

    The real casino money makers, $1 slot machine payouts on the Las Vegas strip are about a 2.5 x better bet.

    Finally, a normal straight sports bet (-110) is about 3x better than playing in a 15% rake fantasy contest. There are very few winning sports bettors

    Sure it’s different playing others instead of the house, but with the avg. player quality ever increasing and the vast multi entries from the best pros it’s effectively closer to playing against the house.

  • noddy

    @cedric19 said...

    The thing that makes me hesitant about those smaller sites is the playing field. Even if there was no rake there if I was constantly going up against a small playing field of 90% pros it would be worse than 13% rake at DK

    90% pros at those sites?

  • cedric19

    @noddy said...

    90% pros at those sites?

    That’s why I’m hesitant, I don’t know the avg. skill level at those places but I would think it would be higher than heavily advertised sites like the big 2.

  • Bighouse55

    15% rake on $3 Drive to Green PGA GPP. 100% fade for me. With the rake and payout structure , slots are more attractive!

  • depalma13

    New York’s law has a 15% tax on gross revenue.

    Rake is only going higher.

  • cedric19

    @depalma13 said...

    New York’s law has a 15% tax on gross revenue.

    Rake is only going higher.

    Wait

    You mean NY is taxing the sites 15% on total entry fees? That state is absolutely out of control. People are leaving in droves because of outrageous taxes. The more they try to take the more people get paid under the table. People I’ve met from New York always seem to be crooked when it comes to accounting and taxes. I understand why now, they have to be

  • btwice80

    @cedric19 said...

    You mean NY is taxing the sites 15% on total entry fees?

    No, 15% of revenue (rake).

  • mannmicj

    It’s simple. This is how they pay for NY. NY is going to get a percentage of the profits to allow them to play there.

    “tax companies with an entry fee (15 percent of gross revenue per year plus up to $50,000 more) and set some important baselines for conduct.”

    “The legislation calls for a 15 percent annual state tax on gross revenues of all sports fantasy contests with an entry fee and another 0.5 percent to be assessed each year on the companies with a maximum of $50,000, reports say.”

    “Senator John Bonacic (the bill’s key sponsor) believes that the state could rake in as much as $5.5 million per year.”

    Those are quotes from news reports, also heard it during the hearing. Making money with DFS is going to be even more difficult as each state takes more of the profits. This is what everyone wants, right? The rake will only continue to increase to the point that 50/50 and double ups will be pointless to play.

  • 00oreo00

    • x3

      2015 DraftKings FFWC Finalist

    • x5

      2014 DraftKings FBWC Finalist

    Last time I checked increasing operating costs does not have any effect on what the market will pay for a service.

    DK/FD will continue to raise rake until they start seeing their net profits decrease as a result of the increases.

  • cedric19

    @00oreo00 said...

    Last time I checked increasing operating costs does not have any effect on what the market will pay for a service.

    But increasing operating costs does have an effect on what needs to be charged for that service in order to maintain profits.

    Are you saying the increase in rake has nothing to do with recent and future increases in expenses and is just the sites testing how much they can rake? Could be, I don’t know

  • 00oreo00

    • x3

      2015 DraftKings FFWC Finalist

    • x5

      2014 DraftKings FBWC Finalist

    Pretty much, they only benefit by raising rake if the contest volume doesnt change drastically. If they raised rake by 10% (from 13 to 14.3%) and volume drops by 15% they are making less profit.

  • badlands92

    The whole rake thing has always confused me. I prefer to look at a contest and divide total entrants by positions paid out.

    For instance, today’s $3 Early tourney on DK pays out 5150 places out of 25490. My 7th grade math came up with roughly a 20% payout percentage. 4400 of the 5150 (86% give or take) win in single digits. Yay $9! In fact, only 190 places (4%) win $20 or more. If you’re only entering one LU like I usually do, it’s really shooting fish in a barrel. A good winning LU most likely gets $6. $8 if it’s really good.

    I guess my point in all this is the joke is on a guy like me. I’ve treated DFS a lot better than DFS has treated me. I think that goes for 90% of us.

  • akarkennny

    more than 90%. the studies have been in. about 1% of DFS players profit, and they make up a large % of the overall winnings on the site. The increased rake should lower that 1% number. Eventually we’re going to get to a point where DFS won’t be profitable for anyone as rake increases.

  • ballabal

    I am not too happy about the rake increases either. However, with more taxation on DFS, it makes the cost of doing business go up. It is like any other business. If the taxes increase the cost of doing business, the company be it DFS, manufacturing, or other companies selling services or goods will pass this on to their customers. When the government gets involved it seems that the cost of business goes up. As more states pass laws to tax DFS companies, the rake costs will probably increase more.

  • badlands92

    @akarkennny said...

    more than 90%. the studies have been in. about 1% of DFS players profit, and they make up a large % of the overall winnings on the site. The increased rake should lower that 1% number. Eventually we’re going to get to a point where DFS won’t be profitable for anyone as rake increases.

    You’re right. This is from the 2015 article about “Mark” the firefighter who lost $20K to DFS.

    “The top 100 ranked players enter 330 winning lineups per day, and the top 10 players combine to win an average of 873 times daily. The remaining field of approximately 20,000 players tracked by Rotogrinders wins just 13 times per day, on average.”

    I have a few tickets left to play in MLB and then I’m out. I’ll be back for NFL and NBA I’m sure. I’m not going to spend the time on LUs to play quarters or the occasional dollar. That’s a waste of time. I’m currently throwing away money ($10-20) when putting together one good LU night in and night out. Therefore, the only choice is to take a hiatus. I’m sure new shark bait signs up every day to take my place. :)

  • btwice80

    @badlands92 said...

    β€œThe top 100 ranked players enter 330 winning lineups per day, and the top 10 players combine to win an average of 873 times daily. The remaining field of approximately 20,000 players tracked by Rotogrinders wins just 13 times per day, on average.”

    This is such a ridiculous statement it’s hard to even know how to begin addressing it. For one thing, there’s no way whoever “calculated” those numbers was able to track such a thing. If it was just from going through the RG results, anyone who knows anything about the system knows it’s worthless as far as gauging profitability, and anyway those numbers still wouldn’t hold water because many of the top players only play their 1-3 cash game lineups the vast majority of days. Even some of the best GPP players only play a few lineups most of the time. So even setting aside the more recent entry limits, an average of 330 lineups entered per day in 2015 or any other year, much less winning lineups, is not even in the universe of plausible. The amount of false information floating around about DFS is crazy.

  • badlands92

    I assumed the 330 winning LUs was spread out across the Top 100?

  • akarkennny

    here’s the study I referenced http://www.mckinsey.com/industries/media-and-entertainment/our-insights/for-daily-fantasy-sports-operators-the-curse-of-too-much-skill

    McKinsey is the best management consulting company in the world. Take it for you think its worth, but as rake increases it hurts everyone.

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