Sharp-eyed DFS players noticed something funny this week as they logged into the two biggest fantasy sites to check the next lineup of contests: FanDuel and DraftKings have raised the rake they take from certain contests. Not surprisingly, the DFS community is not too happy about the change.
A member of the RotoGrinders forums called attention to the changes with a post two days ago. In the original post, user pburghpens22 noted that FanDuel had increased the number of entries allowed in its $200K guaranteed NFL Dive contest without increasing the prize pool. In other words, FanDuel is taking in more money in the form of entry fees, but is still paying out a total of $200,000 in prizes. Thus, more money will go into the FanDuel coffers after this week’s NFL Dive contest.
That $1 contest allowed 235,294 entries last week with a guaranteed prize pool of $200,000. This means FanDuel pocketed $35,294 for a profit margin (rake) of 14.99%.
That same contest this week is allowing 238,095 entries at $1 a pop with a guaranteed prize pool of $200,000. This time, FanDuel is pocketing $38,095 for a rake of 15.99%.
Some users in that thread were surprised to learn the rake was as high as 14.99% even before. It seems some people were still under the impression that FanDuel (and DraftKings) were charging around 10% rake. As one RotoGrinders forum member correctly pointed out, there was a time when nearly all contests charged rake of 10% or less.
DraftKings Increased Rake as Well
FanDuel was the first DFS site to be found raising the rake, but DraftKings has also increased the rake on certain contests. Last year, DraftKings was charging 13.5% rake on its Millionaire Maker according to a post published on CalvinAyre.com.
Now, the Week 4 Millionaire Maker is charging a rake of 15%. It is unclear when exactly the increase happened at DraftKings, but a quick search online shows that rake has certainly increased in recent times at DraftKings as well.
The rake at both sites’ marquee contests (Sunday Million at FanDuel and Millionaire Maker at DraftKings) now sits at 15%. In some contests, the rake now exceeds 16%. For example, three of the FanDuel WFFC Qualifier contests this week are showing up with rake ranging from 16.17% to 16.27%.
The good news is the rake increases have been limited mostly to large guaranteed prize pool contests. Head-to-head contests, 3-100 player contests and 50/50s are still showing rakes of 10% or lower for the most part. Cash game players should be better off under the new rake rates.
What Increased Rake Means for You
Increased rake in the biggest contests makes it harder to win. First of all, there is less prize money to be won relative to the number of entries in a contest. The higher the rake, the less prize money there is to go around.
These incremental increases are also slowly making it increasingly difficult for players to earn a profit. As the rake is increased, fewer and fewer players are able to turn a profit. If you’re just a casual player and have never turned a profit, these increases don’t have as much of an effect, but they do still make it even harder for you to turn things around and become a winning player.
Even small changes in rake can make the difference between winning and losing. This video published on Twitter shows that even small increases in rake can turn large numbers of winners into losers:
— Dan Back (@dan_back) September 26, 2017
How to Calculate the Rake
Something I wish the industry did better was to show how much rake it is charging for contests. Currently, the major DFS sites offer no simple way to see how much rake is taken out of individual contests.
There are however two ways to figure out those numbers for yourself. One is to work out the numbers by hand and the other is to install a browser extension that does the work for you.
Calculating Rake Manually
You can calculate the rake taken out of any contest by comparing the amount of money paid in by users to the total amount in prizes paid out by the site.
The first thing you do is multiply the total number of entries by the entry fee. That shows you how much money is being paid in. From there, you can see how much money the site is keeping back by subtracting the prize pool from that number. Then divide the fantasy site’s profit by the total money paid in to find the rake.
The calculation looks like this:
(# of entries * buyin fee) – prizes paid out = total take
Total take / (# of entries * buyin) = rake
Or You Can Just Use One of These Handy Browser Extensions
RotoGrinders.com has put out some handy browser extensions for Firefox and Chrome that you can use to quickly see the rake for any fantasy site. These tools also include a number of other useful features as a bonus.
Alternative Sites with Lower Rake
A number of posters in the original RotoGrinders thread discussing these changes expressed a desire to find alternative DFS sites after hearing about the rake increases. Some players are tired of the incremental increases while others were mortified to find out how much rake they had been paying even before this latest increase.
One nice thing about the DFS industry is there are plenty of alternative fantasy sites to the Big Two. One bad thing about the industry is there are no alternatives that come even close to FanDuel and DraftKings in terms of total players and guaranteed prize pool events. If you want to compete in contests with seven-figure prize pools, you’ll have to grit your teeth and stick with the higher rake at either FanDuel or DraftKings.
However, if you enjoy head-to-head contests and 50/50s, there are some options. The first that comes to mind is FantasyDraft. Their head to head contests currently charge no rake whatsoever.
Whether you’re playing in $0.25 or $10,000 games, all head-to-head contests at FantasyDraft pay out 100% of entry fees. An added advantage of the Fantasy Draft head-to-head matches is you can block up to 25 individual users from joining your games.
FantasyDraft also has lower rake in its biggest NFL contest of the week. Their Week 4 NFL Run and Gun contest has a guaranteed prize pool of $125,000 with an entry fee of $25 and total rake taken of 12.98%.
One other alternative you may consider if you’d like something a bit different is DRAFT. This fantasy site is geared more towards casual players and has no salary cap system at all. Instead, you and your opponents choose players using a more traditional snake-style draft.
DRAFT also has a queue functionality and auto-pick rules that you can use to ensure you still make smart picks should the contest begin while you’re away from the phone or computer.
Rake at DRAFT varies, but here are a few examples of Week 4 contests to give you an idea:
- 6-person, $1 entry with $5.40 prize pool: 10% rake
- 2-person, $10 entry with $18 prize pool: 10% rake
- 111-person, $5 entry with $500 prize pool: 9.9% rake
- 556-person, $1 entry with $500 prize pool: 10.07%
DRAFT is still a small fantasy site so you won’t find huge contests here. Most games are contested between 2-10 players with a few contests having room for several hundred. DRAFT was recently purchased by the Paddy Power Betfair group, which is a large gaming company with a big advertising budget. This means there is a decent chance DRAFT experiences significant growth over the medium-term and could become a much larger fantasy site over time.