Football Fans Turn Fantasy into Fiscal Reward
Nov. 11, 2005 — -- It's the midway point of the National Football League's regular season, and general manager Ron Carey spends hours each week tweaking lineups of the teams he runs. Is he a high-profile executive in the NFL? Nope, he's a fantasy football player.
Industry estimates suggest there are 13 million to 15 million fantasy football players across the country, mostly grown men willing to pay Web sites like Yahoo!, ESPN (owned by Disney, which is the parent company of ABC News) and CBS Sportsline for the chance to draft a team of players who score points based on their statistics in NFL games. And now businesses are finding that many, like Carey, are willing to invest a little extra to get an edge on their competitors.
Carey is a statistics buff and a football fanatic, a combination that has led him to spend thousands of dollars on fantasy leagues over the past 12 years. He currently manages three teams, totaling $250 for entry fees, and he runs one league. He scours Web sites all week looking for information about players that might give him an edge.
"I'm in contention most years, and I attribute that to the fact that I keep up to date on all the information," Carey said.
With that goal in mind, he shells out $25 every year to get statistical information and advice from the fantasy football Web site FootballGuys.com.
FootballGuys is one of a number fantasy sites that offer player information and expert advice to fantasy owners. Their information is styled to attract fanatics like Carey whose passion for their fantasy teams knows no financial boundaries.
"If there are 15 million people playing fantasy football, we can subsist off just a tiny slice of that," said Joe Bryant, co-owner of FootballGuys.com
Fantasy Players Become Business Owners
As the popularity of fantasy gaming has grown the past several years, businesses offering peripheral fantasy services have sprouted up, often run by fantasy players who found their interest in the games made good businesses.
Bryant and his partner, David Dodds, started FootballGuys in 1999 as a free service that offered fantasy "cheat sheets," newsletters that organized information about player injuries and matchups for each week's games. The two were acquaintances and longtime fantasy players who were looking for more information than they found on traditional sports Web sites.
"I saw a need for a product I couldn't find myself," Bryant said. "It was really just a hobby, but with an eye on a possible business future."
Many services like FootballGuys and competitors like KFFL.com and TheHuddle.com charge fees for access to their information. FootballGuys operated free for several years and started charging users in 2002. Since then, Bryant and Dodds have advertised in fantasy magazines and even put out their own magazine ahead of this year's NFL season.
They've seen traffic and readership increase about 10 percent to 15 percent every year. FootballGuys has 60,000 registered members on a free mailing list, and many of those members are also paying customers, Bryant said. They now employ a part-time paid staff of about 60 contributing writers, and FootballGuys has become a full-time job for Bryant and Dodds.
"We operated free for a few years to set our name in the market and basically operated at a net loss for a couple of years," Bryant said. "Now, we've found a niche in the marketplace, and we've operated in the black for the last two years."
From Hobby to Small Business
Smaller-scale operations have also found a way to make profits. Jeff Christiansen, a Web developer from Fairfax, Va., started posting a fantasy cheat sheet online in 1998. He listed it with several search engines, and the cheat sheet began getting steady traffic.
His site, Fantasy Football Toolbox, now has about 100,000 registered users, and the Web site fftoolbox.com gets about 500,000 page views every week. That's about a 30 percent increase over last year's traffic, and Christiansen expects a similar increase next year.
All of the content on the site is free, and Christiansen sells advertising space to make money. But he has yet to pay for a single ad for his company, preferring to rely on word of mouth.
"We've been approached by some magazines, but we can't justify the costs. The industry is growing so rapidly that we've just been able to ride the wave," said Christiansen, who is also participating in six leagues this year.
Christiansen built the Web site himself and handles most of the writing, which includes player rankings and injury news. His wife, Rebecca, handles some of the business management, and he employs several part-time writers for extra content. He expects to pull in about $30,000 from the site this year, enough money to allow Rebecca to say home with their 3-year-old daughter
"It's turned from a part-time hobby into a small business. Now we take vacations on the money we make from the site," he said.
Hedging Your Bets
With the heavy investments that gamers like Carey make to play fantasy football on a yearly basis, two young entrepreneurs in New York hope that many will pay to hedge their bets. Jack Shankman and his partner Justin Felber, direct marketing salesmen in their early 20s, launched their version of fantasy football insurance, Fantasy Player Protection, in August.
FPP gives fantasy owners the chance to purchase financial protection for the players they draft in case of injury -- purchasing a protection package means that an owner can collect a reimbursement from FPP if an NFL player goes down with a season-ending injury. The exact payouts are determined by a formula that evaluates the player's worth, the point in the season he got injured, and various other factors.
The idea, Shankman said, is that fantasy team owners should consider their hours of research and money spent on leagues as investments. If a team's chances hinge on the health of its players, why not pay for a little protection?
"It's a good market to be in because it's a lot of single guys with expendable incomes who are really into fantasy football," Shankman said.
The site got its first national exposure when it was mentioned in an article on ESPN.com in early September. Since then, Shankman and Felber have been profiled in a number of local newspapers and sports radio programs, and business has picked up.
It was a tough week for the fledgling company, as the NFL's most-protected player, Kansas City Chiefs running back Priest Holmes, suffered a season-ending back injury. FPP will have to pay out a number of protection packages. But the temporary setback hasn't tempered their enthusiasm. As fantasy football's popularity grows, they hope the business will have a big-time future.
"Obviously, we do better when fewer players get hurt," Shankman said. "But the buzz has been too good to not keep it going. The goal isn't just to turn this into a full-time job. The goal is to earn enough money to buy yachts!"