INDUSTRY FORUM

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  • naten

    So I have seen a lot of people recently up in arms about increased rake in some contests, and my question is why does it matter if you are a consistently good player? If you are a solid player, and are getting a top 20-30% score consistently, it really shouldnt affect you. Take rake on double ups for example. If you are finishing with a top 30-35%, you are getting double your entry fee, unless the rake gets absolutely insane. Really increased rake by a couple of percentage points only should affect those sitting on the 44-50% score bubble. Am I thinking through this correctly?

  • hoangryhippo

    In my opinion. If you win it doesn’t matter. I don’t have that problem cuz I am a pretty consistent loser.

  • bringemvaught

    • 303

      RG Overall Ranking

    • Ranked #18

      RG Tiered Ranking

    The higher rake gets, the more quickly people get pushed out of DFS. It’s basically just a transfer of $ from the players to the sites.

  • pmsimkins

    • 2014 FanDuel WFBC Finalist

    • 2015 FanDuel WFBBC Finalist

    In the impossible scenario where you play double ups and finish in the top 30% every single night then yes rake wouldn’t matter. Unless of course it was raised to the point where top 30% doesn’t win. In any realistic scenario rake certainly does matter.

    Here’s an example. Lets say you play 5 $109 50/50 contests each night for a year. Those contests have 8.3% rake. If the price of that contest was raised to $111 the rake would be 9.9%. Over the course of a year this change would cost you $3650.

  • CrazyGabey

    The margins for most profitable DFS players are extremely low.

  • btwice80

    @naten said...

    So I have seen a lot of people recently up in arms about increased rake in some contests, and my question is why does it matter if you are a consistently good player? If you are a solid player, and are getting a top 20-30% score consistently, it really shouldnt affect you. Take rake on double ups for example. If you are finishing with a top 30-35%, you are getting double your entry fee, unless the rake gets absolutely insane. Really increased rake by a couple of percentage points only should affect those sitting on the 44-50% score bubble. Am I thinking through this correctly?

    No, you’re not thinking through it correctly. Over the course of a year (a full season of both baseball and basketball), even the best DFS players finish on that bubble quite a few times. For a really high volume player, just once means thousands of dollars. One pct. point reduces every single daily player’s ROI. It drops minorly profitable players to break-even players and break-even players to losing players.

  • TwoGun

    • 187

      RG Overall Ranking

    • x3

      $1M Prize Winner

    • x3

      2016 DraftKings FFWC Finalist

    Rake matters a lot more in h2h/double ups than gpp’s. Currently, you can get a larger edge in gpp’s since you can use contrarian plays to maximize your edge and newer (more casual) players are drawn to the big payday. Plus one huge bink in a GPP and you’re good for the year (or in life).

    In h2h/double ups, the most you can gain is just double your money, and absolutely no one is good enough to where they can always cash in those contests.

  • sports4life

    My main issue with it is the site hosting the contest is alot of the time making more than twice what the first place winner is. If a site chose to lower the rake and spread the wealth I have to think they would fill those tournaments quicker and would likely be able to create multiple versions of the same contest that would fill as well.

    They like to say they don’t make a profit but when they are spending so much on advertisements and other write offs they are choosing to not show a profit. I am certain if they had a good number cruncher with a big imagination at the top running the contest portion of things they would both be profitable and be able to take less rake. Thus more people cash and return. I would love to see the numbers on how many users play once or twice, don’t win and never return.

    I know there is bills to pay but customer retention will pay those bills. The more they win, the more they play, the more the site profits.

    sports4life

  • deactivated17417

    @CrazyGabey said...

    The margins for most profitable DFS players are extremely low.

    And most DFS players are not profitable.

  • huitcinq

    @naten said...

    Take rake on double ups for example. If you are finishing with a top 30-35%, you are getting double your entry fee, unless the rake gets absolutely insane.

    I think you’re significantly overestimating the ability of “consistently good players”

    A consistently good (not great) player will be looking at maybe a 55-60% win rate for cash games or double ups.

    At a 10% rake to break even you need roughly a 55% win rate, so yes any marginal increase in the rake will eat into the profits of a consistently good player, or turn him from a break even player to a losing player.

    Additionally there’s the fact that higher rakes means less money being “replayed”, the end result being less money on the table.

  • whits23

    2010 FFFC Finalist, 2010 DFBC Finalist, 2011 FFFC Finalist, 2014 DSBC Finalist

    • x2

      2010 FanDuel WFFC Finalist

    • 2011 FanDuel WFBC Finalist

    let us know when your in top 20 to 30 percent on a daily basis

  • whistexpert

    I think the first three problems with rake are:
    1-3) How people think about it

    I made a simple example in excel for kicks. Basically imagine there are two players, A and B, and they are both equally skilled (they both win 1/2 the time)… obviously if you think about it for a moment, because of rake, even if they trade wins for eternity, they are actually decreasing their overall combined wealth.

    Graph: http://oi62.tinypic.com/149p8q9.jpg

    Basically I say they both start with 100 bucks and play a $5 headsup everyday (net wealth = $200). Under FD rules thats +4 to the winner, -5 for the loser. Every day $1 disappears from the system. After ~ 85 days I have shown, the net wealth of Player A +Player B is $115. Because of rake.

    The truth is, if you hope to ever be a true grinder and not just make a bink, you should care about rake. I truly believe FD/DK hope you don’t stop to think why they are so obtuse about how much rake actually goes into competition. That said, I still play DFS, cause boilerplate line they can do whatever they want and I choose to still play.

    But at the very least I can point out an obvious truth.

  • FantasyUpSupport

    If you want to enhance your ability to become a winning player, whether you’re a shark or newcomer, we invite you to check out FantasyUp, where we are 100% rake free. This will enable you to play for longer and enjoy the game we all love to play!

  • kunah

    @bringemvaught said...

    The higher rake gets, the more quickly people get pushed out of DFS. It’s basically just a transfer of $ from the players to the sites.

    This is pretty much the case in my view. After I have played for a while now,,I can see that all I am doing is exchanging the same $10 bill back and forth with all of you every night. Win,lose,lose,win, win, lose ,,,,,, pretty much even. Bankroll stays about the same and it’s getting a little monotonous . But the DK and FD always get their cut. Thinking about shutting it down until NFL season starts.

  • jd0505

    As Crazy Gabey said, the majority of “pro” DFSers aren’t winning an enormous percentage of their games, but are instead taking advantage of slight margins with lots of volume. It’s possible to make a living with a 1-2% ROI, if your bankroll is big enough. Rake increases can turn that 1-2 ROI into ~0, in which case you can no longer make a living.

    Personally, I’m not making a consistent living off this, but I do typically have $500-$1000 in lineups each night, and thanks to a big week 7 in the NFL, I’ve done pretty well for myself. Outside of that big week, I’ve essentially been a break-even player, and I’m guessing I fall somewhere around 0-2% in terms of long-term ROI expectation.

    So, for me, the recent DK rake increases are actually a pretty huge blow to my dream of eventually using DFS as my primary source of income. Of course, I’m still not going to stop playing unless I go on an ugly run that decimates my bankroll (LOOKING AT YOU, MLB). It’s highly entertaining and I already write about fantasy sports.

    And, if I can hit a second big GPP score, I’ll be in a position to increase my bankroll to a point that I could conceivably play DFS “professionally” with an sub-3% ROI. Right now, I’m just not confident enough, so I’ve put most of my NFL winnings away. If rake in low-to-mid stakes games were dropped to the 7-8% range, I wouldn’t hesitate to dig into that money and throw out 2-3k of action per night, with hopes of eventually building up to 10k per night.

    More simply put, rake is massively important for all of us, though I can’t imagine TwoGun is too distraught, having recently won ~$2 million in GPPs. Your average pro DFSer has not hit a millymaker, sunday million or live championship, as guys like TwoGun and Dink are more the exception than the rule in that community.

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