Fantasy Sports Business: Creating long term partnerships
Finding synergies & creating partnerships in fantasy sports is more art than science. Here is one view of the roadmap to success.
So, you are probably thinking….who the hell am I to tell you how to create partnerships in fantasy sports? Well, I have made a lot of partnerships in fantasy sports. I was in the room when SportsLine partnered with Netscape, MLB and NFL. I led the charge at Allstar Stats for the partnerships with FOX, USA Today, NHL, Maxim, NBC Sports and dozens more. I saw many styles when deals were made. Sometimes, deals were made to make as much money as possible in the short term. Generally those deals didn't work out well for either party. The BEST relationships are created when people who wanted to work with each other create an equal partnership with personal respect, committment and dose of compromise.
So, as some of you who listen to Colton & The Wolfman on SiriusXM Fantasy Sports Radio on Tuesday nights at 10pm eastern know, I have seen the movie 48 Hours about one hundred times. Seriously, Eddie Murphy and Nick Nolte are the best partners on film ever. You can have Top Gun, Midnight Run, Lethal Weapon, Butch Cassidy & The Sundance Kid, The Sting, Thelma & Louise and even Dumb & Dumber. Keep them all. Goose and Maverick who? I want Reggie Hammond and Jack Cates.
Step 1: Finding the right partner.
So why bring 48 Hours up when writing about partnerships? Well, because sometimes the best partnerships come from getting to know one another and then figuring out how to work together to solve each other’s problems. Isn’t that what happened here? For those who have not seen the best movie of all-time, 48 hours is the story of Jack Cates (Nick Nolte), a struggling cop who is as dedicated to his job as he is to the bottle. When a convict, Albert Ganz (James Remar) breaks out of jail and shoots a cop in front of him with his gun, Cates is out for revenge. Cates gets a 48-hour pass for a gang member friend of Ganz, Reggie Hammond (Eddie Murphy) to find the cop killer and bring him to justice. When Jack breaks Reggie out, it starts off rocky…
Reggie: This ain't no god damn way to start a partnership.
Jack: Now, get this! We ain't partners. We ain't brothers. And we ain't friends. I'm puttin' you down and keepin' you down until Ganz is locked up or dead. And if Ganz gets away, you're gonna be sorry YOU ever MET me!
Reggie: I'm already sorry.
Step 2: Understand the goals and each other as people
An old friend, the Founder of The Idea Logical Company, Michael Shatzkin said to me once, “People don’t do business with companies, they do business with people.” This is something that I used in my business development dealings for the last 20 years. I treat people as people and not as the representatives of the company that I am talking to. I like to know them personally. If I genuinely care about them and they about me, then we will both try as hard as we can to create a lasting relationship that can be successful long-term and beneficial to the companies that we work for. You cannot do all your business this way. Of course not. But the longest lasting most successful partnerships are created this way. Listen to the words of Howard Roark in The Fountainhead from 1949…
“In all proper relationships there is no sacrifice of anyone to anyone. An architect needs clients, but he does not subordinate his work to their wishes. They need him, but they do not order a house just to give him a commission. Men exchange their work by free, mutual consent to mutual advantage when their personal interests agree and they both desire the exchange. If they do not desire it, they are not forced to deal with each other. They seek further. This is the only possible form of relationship between equals. Anything else is a relation of slave to master, or victim to executioner.”
Step 3: Create equal “value” for all parties involved
When creating a partnership, you should be attempting to create a balanced scale because you care enough about the other party to make sure that what each party gets is equal. This is not to say that you should both have exactly the same responsibilities, but only to say that the level of “value” in the deal should be discussed openly and honestly. Then, the value to each party should be balanced as best as possible. If the balance cannot be reached to a level that is acceptable to both parties, then a partnership should not be consummated. Cash can be placed onto the scale to make it even if necessary, but the more non-cash items in a deal, the better the long-term prognosis for the partnership is. When creating the balance try to be as understanding of both parties’ goals and find the easiest things to give to the other party. An old friend from NBC who created tons of long-term partnerships including the relationship with Rotoworld.com always said, “it’s a sleeve off a vest.” You should add as many things as you can that add value, but are easy for you to put into the deal. Gordon Gekko in Wall Street had the opposite approach as does Wall Street. This is the fantasy sports industry and not cut throat stock trading where...
“Greed, for lack of a better word, is good.”
Step 4: Closing the deal: “Are we done?”
Whenever possible, create the terms of a deal together. You have created a personal relationship with this person. You genuinely care about them. Now work together honestly to make the terms of the deal. This can take each party going back to the stakeholders at their respective companies and coming back honestly to their partner. If you are truly working together on the deal creation, closing it is as simple as one of the parties asking the question: “Are we done?”
We are taught in all the books we read about closing deals. There are these tricks and words that you can say that help you to close a deal. They tell you that you are doing the client a favor since your products and services are great. I am telling you that from my experience it is about being honest, true to yourself and staying focused on the needs of your partner before your own. If you have a good partner, they will be in that same place and it will be simpatico.
In most organizations there is so much pressure to close deals that it goes something like Blake (Alec Baldwin) from Glengarry Glen Ross…
“We're adding a little something to this month's sales contest. As you all know, first prize is a Cadillac Eldorado. Anybody want to see second prize? Second prize is a set of steak knives. Third prize is you're fired.”
Step 5: Get to work. Track everything, but don’t keep score.
How can you track and report everything without keeping score? You can’t. You track all the metrics and have reports to share with each other, but it should not be for reasons of sticking it to them on contract terms. Once the contract is signed, it is put in a drawer, only to be taken out to show the other person what was agreed to and never to litigiously show legal clauses. We keep track of success to help each other do better with the commitment to help each other in each other’s businesses. It is about accountability and adjustments. What adjustments can be made to do better? If you are not tracking and reporting, you simply cannot know that you need to do better or more importantly, what is working. If you don’t want to know whether you need to do better, you don’t care about the partnership. I say, then why have it?
Next, add more things when possible to help your partner reach EXCEED their goals and don’t keep score as to whether they unbalance the scale. Your partner will add things when they can too and it will work long term if you are not keeping score on every little thing. Like Frank Abagnale Sr (Christopher Walken) said in Catch Me If You Can...
"Two little mice fell in a bucket of cream. The first mouse quickly gave up and drowned. The second mouse, wouldn't quit. He struggled so hard that eventually he churned that cream into butter and crawled out. Gentlemen, as of this moment, I am that second mouse."
Look to the future for the real value of a great partnership
The value of your partnership is in its ability to create more partnerships and expand your business even more. Dedicating your mindshare to both your company’s goals and the partner’s goals means that you will be helping each other find more partnerships or more shared ways to succeed together, share resources and win long term.
There are many people who are about getting the deal done. There are dozens of books written on the “art of the deal” by rich and famous people. Yes, you can get rich by doing business in a cut throat ruthless way. You can reap the spoils of a great one-sided business deal. I have found that when you work with people and solve their problems while they solve yours, you have the best long-term results and like James Garner said in Barbarians at the Gate…
“Every penny you think I’m pissing away here, comes back dressed up like a nickel.”