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The fact he's investing his time in building tools for others rather than putting all his time into winning on his own, raises doubts about his actual winnings.

The fact he's investing his time in building tools for others rather than putting all his time into winning on his own, raises doubts about his actual winnings. One explanation might be that he's maxed out how much he can win.

ChuckMcM 11y ago
Another, perhaps more cynical explanation, is that he's actually being paid by one or more Fantasy Sports companies to help promote the notion that playing is a skill based activity rather than a gambling activity. Since the latter gets you banned in NYC :-)
- knowaveragejoe 11y ago
  But both skill and luck are at play in DFS.
  - nickodell 11y ago
    Sure, but that's also true of, for example, poker. However, many states consider poker to be gambling.
    - TheLogothete 11y ago
      Gambling does not mean that poker is not a game of skill.
      - dragonwriter 11y ago
        As a key issue with DFS is state laws in which "gambling" is legally distinguished from "games of skill", yes, in context, it does.
        TheLogothete 11y ago
        I'm not from the US, so didn't know that, but it is stupid. Gambling and game of skill are not mutually exclusive. Gambling means that there is some variance, some risk involved. You gamble on the outcome. That doesn't mean you cannot develop a skillset which will make taking the risk profitable, over the long term. Any law that says otherwise is ill-written.
        akerl_ 11y ago
        By that definition, every action you undertake is gambling. Driving to the grocery store is gambling. But since regulating driving your car to the shop under "gambling" laws doesn't make sense, "gambling" as a legal concept involves wagering money on games of chance, and "games of chance" is a distinct concept which is separated from "games of skill". This is the line that DFS is trying to walk, because the skill side of the line is the side that lets them operate in places where gambling is more strictly regulated.
        TheLogothete 11y ago
        Like I said, any law that insists on making a mutual distinction between games of skill and gambling (risking money on a probability of an outcome) is ill-written. Poker is a game of skill just like backgammon. You can wager money and there is risk (chance) involved, but you can develop skills which will ensure that you are a winner over a less skilled opponent. Just like golf. There is always the chance that you will not make the necessary strikes and a less skilled opponent takes a game from you, but over the long run, you can sufficiently influence the outcome and achieve a positive win rate. This is what makes it a skill-based game. You influence it by your skills. You can place wagers and gamble on the outcome, but that doesn't suddenly make it any less not a game of skill. I'm not very familiar with fantasy sports, but to the best of my knowledge, the same holds true there too. A game of chance cannot be distinguished from games of skill. All games involve chance. This problem probably arises from the poor understanding of "chance" and probabilities by the people who wrote the law (presuming Hanlon's razor here). They wanted to ban games where the operator bleeds the players dry, like slots, lottery, etc., and called them "game of chance", but there is more to the story of "chance", like i outlined above.
    - grobbles 11y ago
      But this is also true for playing the stock market. Indeed, the stock market and fantasy sites are extremely similar, with the same fundamental issue -- a small number of people with a technical and information advantage are essentially skimming the table clean of the entry fees of a lot of people picking randomly or emotionally.
      - nradov 11y ago
        It's not really like the stock market since with stocks the majority of players "win" when measured over a sufficiently long time scale. A better analogy would be playing the derivatives market, which is zero sum (minus broker fees).
        grobbles 11y ago
        The stock market has a winning history because it is, to some degree, a pyramid scheme -- a growing population == more entrants paying out those who entered earlier. When the population stops growing, that premise no longer holds. See: Japan.
  - venomsnake 11y ago
    That is true also for MTG and any game in which you have randomness that does not originate from any of the players. But the question is ratio between luck/skill
- simula67 11y ago
  John Oliver did a segment on this : https://www.youtube.com/watch?v=Mq785nJ0FXQ https://www.youtube.com/watch?v=Mq785nJ0FXQ
- hkmurakami 11y ago
  Sounds like online poker all over again ;)
- jgalt212 11y ago
  or maybe even more cynically, he'll use data about how his customers use his tools to further optimize his own betting strategies.
  - avn2109 11y ago
    Sounds like this is the likely most profitable angle, similar to how DK employees use proprietary DK data to win at FD (and vice versa). Your comment should be higher up the page.
  - knughit 11y ago
    There was a recent news story about how some fantasy company employee made a fortune using questionable means (possibly abusing such data)
dswalter 11y ago
In addition, with the attention fantasy sports has been getting, his competition is probably stepping it up a bit. It may be easier to beat everyone's uncles than to best teams of people who are also using statistics/machine learning/sports analytics.
mr_turtle 11y ago
I have to disagree. I am not too familiar with the world of DFS, but I am with online poker. I understand many heavy hitters from poker transitioned into DFS a few years ago. There clearly is a need for better information, tools, and software for DFS players to make their decisions. Whether this will hurt his winnings by making his competition smarter is another issue. Can't find fault in him by branching out to another stream of revenue.
IanDrake 11y ago
Create a competitive advantage and use it while you can. Then when it's no longer an advantage sell it to the masses and show them the pile of cash you made with it. Happens all the time, works all the time.
asuffield 11y ago
According to the article, he's coming under legal pressure from various sides who want to stop people from doing this sort of thing. That sounds like an excellent time to shift gears to me.
mikeryan 11y ago
It does seem like one of those real-estate folks selling their "three step system for creating wealth flipping homes" who probably make more selling the system then actually flipping houses. In this case where he'd be giving folks the software they need to beat him and if these software systems do work they'd eventually just flood the market and make the whole point moot. That being said the whole industry is under siege. He may just be trying to make as much as he can before it officially becomes gambling or automated play becomes illegal.
- puranjay 11y ago
  It's called income diversification. Why make 5 million from one source when you can make 10 million from three sources?
downandout 11y ago
Another explanation might be that he wants to get everyone else playing the set of lineups his algorithm is spitting out. In GPP (guaranteed prize pool) tournaments, there are usually very large fields and the prize structures are heavily weighted toward a tiny pool of top finishers. The key to winning these tournaments isn't necessarily picking the lineup with the most expected fantasy points, but rather having lineups that very few others have, because you are looking for an extreme result that is different from that of your competition. GPPs are won much more through application of game theory than they are through any analysis of the specific games or players. If he gets a large percentage of the DFS player pool to play his algorithm's lineups and he goes a different direction, he'll crush the GPPs.
- giarc 11y ago
  I'm not a game theorists or anything but you don't win by having a different team, you win by having a different team that also does well. If his software is telling people to pick XYZ great lineup, he has to come up with a better lineup otherwise they all share the prize and he gets nothing.
  - downandout 11y ago
    It matters to some degree which players he picks, but in the case of GPPs it matters much more that the lineup is unique. There are lots of lineups that have nearly the same expectation.
  - fredophile 11y ago
    He doesn't need to come up with a better lineup. An inferior lineup with a higher payout could lead to a fighter expected value. For example, if he has a lineup that wins 1/5 the times the best lineup does but pays out 10 times as much he would double his returns.
gozur88 11y ago
Reminds me of the guys who sell books on wining at blackjack. If your system is so good, why are you selling books?
- tempestn 11y ago
  Because even if you have an edge at a game of skill and chance, it's not a license to print money. Professional blackjack players have to fly under the radar, and even with the large bankroll needed to survive swings, can only expect to make somewhere in the 5 figures. Plus, you have to spend all your time playing blackjack. Wouldn't you rather sell a book?
- babuskov 11y ago
  Because it's passive income.
- FanaHOVA 11y ago
  You play against the house in blackjack, you're not playing against other people who read your book so it doesn't hurt his chances at winning.
- RogerL 11y ago
  Playing blackjack is really, really, really boring (really!). There's a reason professional gamblers call it a 'grind'. There are mathematical systems to beat blackjack (counting cards, change your bets when the odds are in/out of your favor). Are you doubting this? The number of people that are going to successfully read the book, count cards, and beat the author are few to zero. The number that will buy the book? Many. Heck, I've read poker books, but don't play poker. It's interesting to learn algorithms, reasoning, and also to consider the psychological elements. As an aside, blackjack is beatable if you count cards. The books are not bogus (not sure if you are implying that or not).
  - schwap 11y ago
    Daily Fantasy Sports is not like blackjack, because how well your fellow players do directly impacts your chances of winning.
paxtonab 11y ago
He's also involved in multiple lawsuits stemming from the fact that he has an "unfair advantage" from using his software. If he makes it available to everyone he will still be making money if the courts don't rule in his favor... Plus fantasy sports are huge right now. I'd say with his track record he has the potential to make a very profitable startup. He also had to pony up $24k to submit 888 lineups on the day he won $221k, so I'd say he's doing all right.
ianstallings 11y ago
He probably does it for the same reason we program and tell the world about it on HackerNews - accolades. People are partly driven by peer approval. Another thing is that this type of job, relying on gambling for a living, can be prone to huge swings in wins and losses. So people look for ways to soften the blows with stable income.
emidln 11y ago
There is significantly less risk in selling the information than using the information.

ChuckMcM 11y ago

Another, perhaps more cynical explanation, is that he's actually being paid by one or more Fantasy Sports companies to help promote the notion that playing is a skill based activity rather than a gambling activity. Since the latter gets you banned in NYC :-)

knowaveragejoe 11y ago
But both skill and luck are at play in DFS.
- nickodell 11y ago
  Sure, but that's also true of, for example, poker. However, many states consider poker to be gambling.
  - TheLogothete 11y ago
    Gambling does not mean that poker is not a game of skill.
    - dragonwriter 11y ago
      As a key issue with DFS is state laws in which "gambling" is legally distinguished from "games of skill", yes, in context, it does.
      - TheLogothete 11y ago
        I'm not from the US, so didn't know that, but it is stupid. Gambling and game of skill are not mutually exclusive. Gambling means that there is some variance, some risk involved. You gamble on the outcome. That doesn't mean you cannot develop a skillset which will make taking the risk profitable, over the long term. Any law that says otherwise is ill-written.
        akerl_ 11y ago
        By that definition, every action you undertake is gambling. Driving to the grocery store is gambling. But since regulating driving your car to the shop under "gambling" laws doesn't make sense, "gambling" as a legal concept involves wagering money on games of chance, and "games of chance" is a distinct concept which is separated from "games of skill". This is the line that DFS is trying to walk, because the skill side of the line is the side that lets them operate in places where gambling is more strictly regulated.
        TheLogothete 11y ago
        Like I said, any law that insists on making a mutual distinction between games of skill and gambling (risking money on a probability of an outcome) is ill-written. Poker is a game of skill just like backgammon. You can wager money and there is risk (chance) involved, but you can develop skills which will ensure that you are a winner over a less skilled opponent. Just like golf. There is always the chance that you will not make the necessary strikes and a less skilled opponent takes a game from you, but over the long run, you can sufficiently influence the outcome and achieve a positive win rate. This is what makes it a skill-based game. You influence it by your skills. You can place wagers and gamble on the outcome, but that doesn't suddenly make it any less not a game of skill. I'm not very familiar with fantasy sports, but to the best of my knowledge, the same holds true there too. A game of chance cannot be distinguished from games of skill. All games involve chance. This problem probably arises from the poor understanding of "chance" and probabilities by the people who wrote the law (presuming Hanlon's razor here). They wanted to ban games where the operator bleeds the players dry, like slots, lottery, etc., and called them "game of chance", but there is more to the story of "chance", like i outlined above.
  - grobbles 11y ago
    But this is also true for playing the stock market. Indeed, the stock market and fantasy sites are extremely similar, with the same fundamental issue -- a small number of people with a technical and information advantage are essentially skimming the table clean of the entry fees of a lot of people picking randomly or emotionally.
    - nradov 11y ago
      It's not really like the stock market since with stocks the majority of players "win" when measured over a sufficiently long time scale. A better analogy would be playing the derivatives market, which is zero sum (minus broker fees).
      - grobbles 11y ago
        The stock market has a winning history because it is, to some degree, a pyramid scheme -- a growing population == more entrants paying out those who entered earlier. When the population stops growing, that premise no longer holds. See: Japan.
- venomsnake 11y ago
  That is true also for MTG and any game in which you have randomness that does not originate from any of the players. But the question is ratio between luck/skill
simula67 11y ago
John Oliver did a segment on this : https://www.youtube.com/watch?v=Mq785nJ0FXQ https://www.youtube.com/watch?v=Mq785nJ0FXQ
hkmurakami 11y ago
Sounds like online poker all over again ;)
jgalt212 11y ago
or maybe even more cynically, he'll use data about how his customers use his tools to further optimize his own betting strategies.
- avn2109 11y ago
  Sounds like this is the likely most profitable angle, similar to how DK employees use proprietary DK data to win at FD (and vice versa). Your comment should be higher up the page.
- knughit 11y ago
  There was a recent news story about how some fantasy company employee made a fortune using questionable means (possibly abusing such data)

dswalter 11y ago

In addition, with the attention fantasy sports has been getting, his competition is probably stepping it up a bit. It may be easier to beat everyone's uncles than to best teams of people who are also using statistics/machine learning/sports analytics.

mr_turtle 11y ago

I have to disagree. I am not too familiar with the world of DFS, but I am with online poker. I understand many heavy hitters from poker transitioned into DFS a few years ago. There clearly is a need for better information, tools, and software for DFS players to make their decisions. Whether this will hurt his winnings by making his competition smarter is another issue. Can't find fault in him by branching out to another stream of revenue.

IanDrake 11y ago

Create a competitive advantage and use it while you can. Then when it's no longer an advantage sell it to the masses and show them the pile of cash you made with it. Happens all the time, works all the time.

asuffield 11y ago

According to the article, he's coming under legal pressure from various sides who want to stop people from doing this sort of thing. That sounds like an excellent time to shift gears to me.

mikeryan 11y ago

It does seem like one of those real-estate folks selling their "three step system for creating wealth flipping homes" who probably make more selling the system then actually flipping houses. In this case where he'd be giving folks the software they need to beat him and if these software systems do work they'd eventually just flood the market and make the whole point moot. That being said the whole industry is under siege. He may just be trying to make as much as he can before it officially becomes gambling or automated play becomes illegal.

puranjay 11y ago
It's called income diversification. Why make 5 million from one source when you can make 10 million from three sources?

downandout 11y ago

Another explanation might be that he wants to get everyone else playing the set of lineups his algorithm is spitting out. In GPP (guaranteed prize pool) tournaments, there are usually very large fields and the prize structures are heavily weighted toward a tiny pool of top finishers. The key to winning these tournaments isn't necessarily picking the lineup with the most expected fantasy points, but rather having lineups that very few others have, because you are looking for an extreme result that is different from that of your competition. GPPs are won much more through application of game theory than they are through any analysis of the specific games or players. If he gets a large percentage of the DFS player pool to play his algorithm's lineups and he goes a different direction, he'll crush the GPPs.

giarc 11y ago
I'm not a game theorists or anything but you don't win by having a different team, you win by having a different team that also does well. If his software is telling people to pick XYZ great lineup, he has to come up with a better lineup otherwise they all share the prize and he gets nothing.
- downandout 11y ago
  It matters to some degree which players he picks, but in the case of GPPs it matters much more that the lineup is unique. There are lots of lineups that have nearly the same expectation.
- fredophile 11y ago
  He doesn't need to come up with a better lineup. An inferior lineup with a higher payout could lead to a fighter expected value. For example, if he has a lineup that wins 1/5 the times the best lineup does but pays out 10 times as much he would double his returns.

gozur88 11y ago

Reminds me of the guys who sell books on wining at blackjack. If your system is so good, why are you selling books?

tempestn 11y ago
Because even if you have an edge at a game of skill and chance, it's not a license to print money. Professional blackjack players have to fly under the radar, and even with the large bankroll needed to survive swings, can only expect to make somewhere in the 5 figures. Plus, you have to spend all your time playing blackjack. Wouldn't you rather sell a book?
babuskov 11y ago
Because it's passive income.
FanaHOVA 11y ago
You play against the house in blackjack, you're not playing against other people who read your book so it doesn't hurt his chances at winning.
RogerL 11y ago
Playing blackjack is really, really, really boring (really!). There's a reason professional gamblers call it a 'grind'. There are mathematical systems to beat blackjack (counting cards, change your bets when the odds are in/out of your favor). Are you doubting this? The number of people that are going to successfully read the book, count cards, and beat the author are few to zero. The number that will buy the book? Many. Heck, I've read poker books, but don't play poker. It's interesting to learn algorithms, reasoning, and also to consider the psychological elements. As an aside, blackjack is beatable if you count cards. The books are not bogus (not sure if you are implying that or not).
- schwap 11y ago
  Daily Fantasy Sports is not like blackjack, because how well your fellow players do directly impacts your chances of winning.

paxtonab 11y ago

He's also involved in multiple lawsuits stemming from the fact that he has an "unfair advantage" from using his software. If he makes it available to everyone he will still be making money if the courts don't rule in his favor... Plus fantasy sports are huge right now. I'd say with his track record he has the potential to make a very profitable startup. He also had to pony up $24k to submit 888 lineups on the day he won $221k, so I'd say he's doing all right.

ianstallings 11y ago

He probably does it for the same reason we program and tell the world about it on HackerNews - accolades. People are partly driven by peer approval. Another thing is that this type of job, relying on gambling for a living, can be prone to huge swings in wins and losses. So people look for ways to soften the blows with stable income.

emidln 11y ago

There is significantly less risk in selling the information than using the information.