I get asked a lot how did I get started in the fantasy sports industry, especially considering my background as an aerospace engineer. Well, I started by putting up a website and writing about the industry. Ultimately, I sold that company, and found myself starting a new fantasy sports company, again. These are the main steps I took in launching and growing Fantasy Ethos. By the way, the title of this post very well could say fantasy baseball, fantasy sports, fantasy hockey, fantasy ________, but I just choose football since its the most popular fantasy sport.

Find a niche First, you have to figure out what you are going to do in the industry. Maybe it is a piece of software that you programmed for yourself that you would like to take public, which is what Mock Draft Central and Draft Analyzer did. Perhaps, you have an interesting way of giving fantasy advice, which is how Matthew Berry got started with the Talented Mr. Roto, which he later sold to ESPN. Whatever you want your niche to be, make sure it is unique. If you are going to do something similar to other businesses, make sure you know everything about that niche, included failed attempts to penetrate that niche.

Make sure you size up your niche. For example, I will consider Fantasy Ethos wildly successful when it gets over 1,000 users a day every day. Fantasy ethos appeals to a very small fraction of fantasy players and to members of the fantasy industry. That’s it. If you think you site can succeed on that small of a market, then go for it. Make sure you understand what the minimal number of customers is.

One more thing, you should prepare to change your niche. Rarely do you ever end up where you set out to go. I only started writing about the fantasy industry because I was trying to look for a niche. Turns out that was my niche. ProTrade started with an exchange-based fantasy sports game and morphed itself into Citizen Sports to focus on the growing Facebook and social media market.

Build a Website Once you figure out what you want to do, figure out what to call your business, buy a domain name, and then launch your website. If your site is mostly going to be content, you can be running in an afternoon with the installation of a Wordpress blog. (Aside: I recommend not using a “wordpress.com” free account because if/when your business grows, you will want your own domain name and a little more control over the site.)

If you already know what you want, use our GoDaddy link to purchase the domain name and hosting, as it helps me pay our bills.

Once you have your site launched, get to work. The easiest way to get into the fantasy sports industry is by being active in the fantasy sports community. Get out there as soon as you can.

Be Patient Most small successful small business in the fantasy industry took at least three years before they started generating any significant income, and about five years before the owners felt like the company was really rolling. Part of the growth problem in the industry is that fantasy players are creatures of habit, and keep doing the same things year after year. The other, and probably bigger issue is that fantasy players are secretive. It is not like finding a good restaurant that you will tell everyone about. If fantasy players find the next great thing, they will not tell anyone about it. They use it to only help themselves. These habits make new customer acquisition a struggle. Which brings me to my next point.

Bootstrap Spend as little as money as possible. With the time line to develop a successful fantasy sports business three to five year, it will take a while for investors to get a good return on their money. Consequently, build with as few dollars as you can. To be clear, I am not saying invest in lower quality products and cut corners. Spend when you need to spend to make a high-quality product or service. Spend $250 to get a clean, fresh design for your website from an online designer, but do not spend $10K to have an advertising agency develop concepts for you. Spend money to make sure your website has plenty of bandwidth. Spend on customer service. Always.

This also means that you need to take as little outside funding as possible. I can count on one or two hands the number of fantasy companies that are netting over $1M per year. If you take in $500K in funding, you are increasing the odds against yourself in succeeding and making money on your fantasy business. There is no easy solution to this problem, but the best solution is to figure out how to do more for less.

Market To be successful, you will need to market your business. You should/will spend at least as much time marketing your site as your improving your business. Luckily, there has never been a time that you could market a product as easily as you can now without spending money, which is even truer for fantasy companies, since they are mostly internet-based. Between engaging customers on blogs, twitter, facebook, social media, etc and search engine optimization, there are plenty of ways to drive traffic without spending much money. Find where your customers are and engage them there.

This is enough to get you started. As I think of new points, and learn new lessons, I will continue to write about them, which means you should keep checking here for new content.

If you would like to add to this discussion, please comment on the article, tweet the article, or email me at derrick@fantasyethos.com.