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Creating and Collecting Fantasy Football League Fees

Updated 8/22/2017 by Brad Perniciaro

Collect Fantasy League Fees

Introduction

In Part 4 of this article series on starting your own fantasy football league, we discussed the qualities you should emphasize when choosing a fantasy football commissioner. In this article, we will cover various options for establishing league fees for the purpose of generating league revenue. Most fantasy football leagues offer some type of awards (either monetary or otherwise) to the best teams each year. In order to finance these yearly awards, you’ll need to find a way to raise a few bucks.

Fee Structures

No single form of fund raising works for all fantasy leagues, but there are two well-established fee structures which are common in the fantasy football community: One-time Entry Fees and Transaction-Based fees. These are tried and true approaches to generating league revenue that should help you raise the desired funds to finance your league prizes.

 

One-time Entry Fees

One-time league entry-fees are far and away the best method for generating fantasy football league revenue. Most owners favor this method because it is a definite, known amount that they can plan for. Commissioners generally favor this method because it requires the least amount of effort as he only has to collect one lump-sum payment from each fantasy owner.

The league entry fee can be any value but most serious leagues charge around $100 per team. I think this is a reasonable entry fee when you consider that this includes many weeks of fun-filled fantasy football enjoyment. Most commissioners do not pocket any of the entry fees (they should be running the league out of the goodness of their heart).

League fees are generally used to pay for league hosting and/or any prizes to be awarded at the end of the fantasy season.  And that's another reason to college league fees early.  If you want to purchase a significant fantasy prize like a fantasy championship belt, you'll need that money on-hand to make that purchase.  I review some of the best fantasy football championship belts here.

In addition to being the most manageable system for generating league revenue, entry fees also help to eliminate unreliable fantasy owner prospects. If someone is unwilling to front $100 for the entire fantasy season, then chances are they're not interested enough to stay involved for the entire fantasy season. The more money you charge for a league entry fee the greater chances you have for eliminating disinterested prospects, but be careful because you also don't want to make the league unaffordable for those who are generally interested.  Find the balance that works best for you and your vision of the league.

Yet another plus for entry-fees is that they can encourage league participation throughout the entire fantasy football season. By collecting money at the beginning of the season, there is an available prize pool starting at week 1. One of the things we’ll discuss in a later installment is the idea of awarding weekly cash prizes to the team with the highest point total. The idea of winning a weekly cash prize helps to ensure that all teams will remain engaged throughout the entire NFL season, even if they have been eliminated from the fantasy playoffs.

There is a natural tendency for owners to slack-off if they know they have no chance at playing for the championship. In the worst-case scenario, this could lead to their opponents getting an easy victory late in the season (a situation which would not be fair to other teams vying for a playoff spot). By awarding a weekly prize during each week of the regular season, you will encourage all teams to remain active and put their best foot forward. This will have the desired, secondary effect of ensuring that the competition remains high throughout the entire fantasy season.

Note: The tool I designed to create custom fantasy football cheat sheets using drag and drop is completely free (try it out now). Inside your sheet you can reference stats, player news, other rankings, and even add your own player notes. Then simply generate a printable sheet for your draft.

Transaction-Based Fees

Some leagues implement a fundraising system whereby fees are accrued based on user-initiated transactions such as waiver-wire pick-ups or player trades. For instance, a league may attach a $0.25 fee for each player that is pulled from the waiver-wire and/or attach a $5.00 fee to any team that participates in an approved player trade. This fee structure is defined to gradually build up a pot dedicated to year-end prizes. 

So, rather than making ever owner pay a flat fee, each owner's fees will depend on the number and type of his/her player transactions. While transaction fees may seem small, over the course of an entire fantasy season they can result in a very sizable pot.

I generally advise against transaction-based fees unless your league is well-established and everyone is in favor of this type of system. Collecting entry fees from participants before the season begins can be nerve-wracking in itself, even in a well-run league. Collecting transaction-based fees at the end of a season as is nearly impossible (you generally have no other choice in this type of system since transactions occur throughout the entire season).

The last thing you want as fantasy commissioner is to chase people around after the season has ended for money in order to pay out the league prizes. To avoid finding yourself in this precarious position, charge a fair but sizable entry-fee at the beginning of the season and avoid transaction-based fees. The end-result is largely the same and you can focus your attention on running the league and not chase people around for money.

Collecting Money for Fantasy Football

Even in leagues where the members know each other well, commissioners frequently have problems collecting league entry fees from owners.  How you handle this situation depends largely on your managerial style.  

Immediate Expulsion

Some owners choose to immediately expel any owners who do not pay by the predefined deadline.  If your deadline is before the fantasy draft, be sure that you leave yourself enough time to find a replacement owner so your draft isn't thrust into disarray.  If your payment deadline is right before the playoffs, be sure you have a plan for how the league will absorb the lost revenue.

Late Payment Fee

If you think you will eventually recover the fees, you can always apply a late fee to owners the initial fee, but good luck collecting the increased fee if you can't even get the first fee.

Passive Administration

There is another well-tested strategy for addressing late payment that will encourage people to pay in a timely manner: Instead of establishing a payment deadline for league-entry fees, allow your owners to pay at their leisure, as long as payment is made before the league playoffs began. The catch is that any weekly prize won by an owner who has not paid their entry-fee is forfeited by that owner and added to the pot for the league champion. This accomplishes several goals:

  • It punishes the delinquent owner for paying late (i.e. he/she gives up a weekly prize that otherwise would have been won) and hopefully serves as motivation pay as soon as possible.
  • The commissioner can focus on administering the league and not chasing people around for money.
  • It allows teams to pay their league fee at their leisure and 4 months is plenty of time to scrape up the entry fee.
  • The champion is awarded a larger pot at the expense of the procrastinators.

You may be wondering how you handle the situation where a team does not pay his money by the time the playoffs start. Well, if you chose your players wisely you should never run into this situation because all of your owners should be reliable. In the most extreme circumstances, the last option is to kick out the delinquent owner and replace them with someone else.

If the deadbeat owner cannot pay their league entry fee by season’s end it is probably wise to replace them anyway. I have used this system in my own leagues and it has worked flawlessly with very few payments coming after week 1.

Conclusion

In this article we discussed various fantasy football fee structures along with ideas for how to collect money owed.  In the next installment of this article series, we'll cover how to choose a fantasy football hosting service for your league. No one likes to change hosting services after each fantasy season; our tips will help you identify a host who can support your league's needs year after year.

 

 

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