Company: Allstar Stats / Rotoworld.com / Sandbox.com (NBC Sports Fantasy Division)
Launch date: January 1, 1989 (Internet March 1995)
Became full-time operation: 1989
No. of employees: 10

This week we debut a new format for the business profiles, where one or more representatives of the company tell you about the operation via a Q&A format. This first edition draws together several businesses under the NBC Sports fantasy umbrella, with answers provided by Rick Wolf, director of business development for NBC Sports.

1) What was the impetus for the creation of Allstar Stats? What did it offer in its earliest stages?

Rich Pike and Mike Oliveto were high school friends and coworkers at Friendly’s restaurant in Thornwood, N.Y. In 1988, Oliveto worked as a developer at the Power Authority and Pike worked in marketing for online services CBS/IBM/Sears joint venture Prodigy. They played in a fantasy league and hated the reports. Oliveto took the data from the reports and generated better ones. The next year, they decided to run the business out of their parents’ house. Oliveto would do technology and Pike would focus on marketing. They bought a stats feed, bought ads in magazines and started running leagues.

The leagues came in very fast, so they bought hardware and worked long hours to make sure that their customers had the highest level of service and the best reports in the biz.

• In 1992, they added an IVR (interactive voice response) system so people could do transactions by phone.
• In 1995, they went on the Internet with an automated transaction system called the Evaluator.
• In 2002, they brought on Rick Wolf and his Full Moon Sports consulting company.
• In 2003, they hired Gregg Rosenthal as lead NFL writer.
• In 2004, they hired Rick Cordella, who wrote as a stringer to program Rotoworld.com. Cordella quickly became part of the management team and has carried the vision for Rotoworld.com from 2005 to today.

2) How did Rotoworld.com come about, and what has driven it to its current position in the industry?

Rotoworld.com was created as a news source for Allstar Stats leagues in 1998. Matthew Pouliot and Troy Beech approached the Allstar Stats owners with the idea of working for advertising money. Those four initially split all revenues for Rotoworld.com. In 2002, it became a destination site when Allstar spent money at a new design and Pike and Wolf developed our first online draft guides and Assistant GM products (now called Season Pass).

3) What kind of startup costs did each incur, and how did you come up with any necessary capital?

Pike and Oliveto started Allstar as a side job in 1989 and they quit their day jobs in 1990. They spent $10-15k on print ads the first year that they got back in signups in 1989.

4) Was there a big break, a specific occurrence, move or chain of actions that vaulted Rotoworld.com to its status as a leader in fantasy content?

Two moments: The first major moment is when Fox decides (in August 2003) to buy fantasy content instead of hiring writers. They pay us MUCH less than what they would pay a staff, but it allows us to invest EVERY dollar back into the site/personnel. It allows us to keep all our best people and extend technologically and content to achieve our leadership position, especially in content premiums.

The second major moment happens when Rotoworld.com takes a risk on an idea from Rick Cordella on how to maximize advertising on the site. In August 2004, Rotoworld.com begins to use ad networks to fill inventory that is not sold. An innovative method of using five to six ad networks at the same time results in triple the ad revenue for Rotoworld.com. Again, Pike and Oliveto are smart enough to pump it ALL back into Rotoworld.com and rebuild infrastructure of Sandbox/Allstar Stats, automating most of the two legacy sites.

5) How much of the revenue is connected to Rotoworld’s various deals to feed player updates? How many partners does the company have on that front?

Rotoworld.com has only a small number of clients (about a dozen). The content is also distributed to the 235 affiliates of NBC Sports.

6) How did the arrivals of Rick Wolf and Rick Cordella alter plans for or directions of the businesses?

Rick Wolf would never have played fantasy sports if it wasn’t for Rich Pike. In 1989, Pike, who played softball with Wolf, convince an owner in the Prodigy Rotisserie league to add Wolf as his partner since Wolf was on the development team for Baseball Manager, the first online fantasy baseball game. Wolf returned the favor in late 2001, by creating a set of suggestions for how to grow the Allstar Stats business, including private label games for media companies, Rotoworld.com as a destination site and content premiums. In January 2002, Wolf’s Full Moon company contracted with Allstar Stats in a heavily performance-based deal to raise top-line revenues.

Lost in the Allstar Stats success story is the impact of Rick Cordella. His advertising system innovation that tripled Rotoworld.com’s revenues starting in 2004 turns out to be the critical Allstar Stats/Rotoworld.com innovation since it drove high-margin revenue and set the stage for NBC’s involvement.

Most important is Cordella’s daily focus to quality, coupled with his ability to find, sign and most importantly retain great fantasy sports writers and understand what great sports content is. This is what makes Rotoworld.com continue to lead in fantasy news and premium content products.

7) How did the relationship with NBC generate?

NBC bought the rights for NFL football and wanted some contests and fantasy content for their soon-to-launch NBCSports.com. They called their old friend Brett Vandermark, who worked for the Arena Football League. Sandbox.com did the official Arena Football League games using an Allstar Stats engine and content from Rotoworld.com. VanderMark recommended Allstar Stats and Wolf, then acting chairman of Sandbox.com.

Allstar Stats execs worked with NBC Sports veteran Kevin Monaghan to create a partnership deal to produce games/content. At that time, NBC Universal became interested in owning it all to jumpstart its new NBCSports.com initiative. NBCU purchased Allstar Stats, Rotoworld.com and Sandbox.com on August 18, 2006.

8) What have been the biggest benefits of NBC’s acquisition of Allstar? If you could go back, is there anything you would do differently?

NBC brings a level of expertise, passion and economies of scale that taught us how to be better at what we do. They have shown a keen interest in the Rotoworld.com property as a breaking sports news property and continue to be very supportive of the premium content business. It really is a family.

As for what I would do differently, I believe you should never go back. Look ahead and the future is bright!

David Bowie said: “Things that happened in the past only happened in your mind. Forget your mind and you’ll be free.”

9) What examples can you point to of NBC’s commitment to the fantasy platform?

We had 30-second spots on preseason games. We have had integrated information in all telecasts and in every Football Night in America. We have been promoted in every type of NBC Sports telecast.

Most importantly, they include fantasy in EVERY discussion. NBC Sports simply gets it on all levels.

10) What can we expect to see from you guys going forward?

We will continue to innovate whether in content premiums, fantasy content and/or content strategies. We will continue to dedicate ourselves to speed of delivery and depth of coverage. We will continue to expand fantasy sports news to be thought of as sports news.