Inverting The Pyramid: The Optimal Offseason Guide to NFL Team-Building

Availability should dictate which positions are targeted when, placing the optimal bets at the right points in the offseason cycle

With the Combine in the rearview mirror (make sure to check out my modeling on what actually matters among the various drills and measurements), the NFL media-take complex will now shift to free agency. There are a ton of great resources available for ranking individual names in free agency, and I even got into that game last offseason. I’ll do more with valuing free agents soon, but for now I’m going to focus on something much more important: a general philosophy to how to approach free agency and the rest of the NFL offseason.

In this analysis, I’m going to combine previous research I’ve done on the higher-level, positional-value trends for free agency and the NFL draft, plus some new research on the trade market. These are the three levers teams have to build their rosters, and the availability of elite talent in each phases by position should dictate how teams approach the offseason.

If you look at team-building very literally, the key to winning is signing, trading for and picking the right players in free agency, veteran trades and the NFL draft. The fundamental problem with optimizing “acquire the right players” is that every other team is also investing most of its resources into player evaluation. Teams employee lots of scouts and coaches who have poured over tape and numbers to find who they believe to be the best players in the NFL. As much as I’d like to mock the “tape don’t lie” philosophy to evaluation, it’s true that watching players is the best way to evaluate them as individuals.

But what we’re trying to do is look for bigger relative advantages than being better at individual evaluations. Spending one-hundredth of the resources on developing a macro strategy of which positions to value where can bring outsized returns, simply because so few teams are fully incorporating the lessons of an optimal strategy.

On a recent podcast interview, former Sacramento Kings analyst and current Co-Founder and Chief Scientist at Zelus Analytics Luke Bornn had this to say about his biggest impact in his time in the NBA:

My whole background is in building really complex models and understanding really complex processes. And if I think of what I did in my three years with the Kings, ultimately, it was convincing people to take more 3-point shots. So fundamentally when you boil it down, I was trying to convince people that the number three is bigger than the number two.

“So you don't need complex math for any of that kind of stuff. Oftentimes, the biggest sources of impact you can have within an organization are really, really simple things.”

Player evaluation is extremely complex, but knowing which positions tend to provide the best value in different phases of the offseason cycle is fairly simple. Using simple heuristics like “don’t spend a high pick on a running back” (or tight end, to apply to this class), are more valuable than spending vast resources to get a marginally better evaluation of top running back prospects.

TIMING IS EVERYTHING

But before we get into how to apply analytical offseason research into a systematic formula, we have to think about how the NFL schedule plays out during the offseason. Unlike some other sports, like the NBA, the NFL free agency period starts months in advance of the draft, meaning that teams have to fill roster holes with veterans before they know how they’re going to spend their most valuable offseason resource: NFL draft picks.

This is how every season you have bigger free-agent signings immediately lose some of their usage value after the draft, most pointedly in the case of free agent veterans quarterbacks who are signed to teams that then use a high pick on the position - Mike Glennon’s 3-year, $45 million deal in the 2017 offseason comes to mind.

You have to know how to best allocate draft capital first, then apply that knowledge to your strategy in the prior free agency and trade cycles. The top of the NFL pyramid for impact and finding elite talent is the NFL draft, but it’s really the final piece of the team-building puzzle, outside of lower-impact signings and trades that tend to come after the draft. Teams have to think about this pyramid of where to find elite talent, but invert it for the NFL offseason schedule. I’m gratuitously stealing “Inverting the Pyramid” from a great soccer tactics book that you should all check out.

The graphic below illustrates how to view the NFL offseason:

Free agency comes first and has the largest player pool to choose from, literally every single potential football player entering the 2024 offseason not under contract. Then it’s the trade market, which never ends up being big in terms of player movement, but theoretically includes every player under contract for the 2024. At this point in the offseason, teams have between 45-55 players under contract, meaning the total addressable trade market in the NFL includes over 1,500 players. Last in timing and size of the player pool is the NFL draft. There will be 257 selections in the 2024 NFL draft, and expanding the pool to all players who have any ranking on media big boards brings the total draftable pool to a little over 500 prospects.

Looking at the opportunity cost and variance side of the pyramid, the draft has the highest of both, followed by trades and free agency. The biggest factor driving the variance in future player performance is whether you have evidence of their play in the NFL. Free agents (outside of UDFAs acquire post-draft), have played in the NFL, making their go-forward projections more solid. Draft picks have no NFL experience and are pure projections. Trades are usually an exchange of an experienced NFL player for draft picks, putting the variance somewhere between the other two.

Opportunity cost is closely linked with variance, but you can think about it in a different way. The most valuable players in the NFL should never make free agency or the trade market, as their current teams would want to retain them at the market price. Free agents are players teams have chosen to let go, believing they aren’t the most efficient/valuable use of limited cap dollars. Those free agents now will likely command even higher salaries as free agents, as the buyer pool expands to the other 31 NFL teams from only one team that had the exclusive right to extend their contract.

Draft picks have the higher opportunity cost, as they’re realistically the only place you can acquire the most valuable positions in the NFL and then have the right to retain them through their primes. Not only that, those players’ values are attached to a cost-controlled rookie contract for the first 4-5 seasons, adding to the potential upside. The draft is, by far, the best avenue for hitting on franchise-shifting values that can’t be found elsewhere. I’ll go more into the exact positions that need to be targeted in the draft later, but an easy example is quarterback: No team is letting a quarterback in his prime leave via free agency or trade that they really want to retain. Kirk Cousins was one of the few solid starters in his prime who hit the market, but Washington likely could have retained him if they chose. Recent trades of Matthew Stafford, Russell Wilson and Aaron Rodgers were strategic choices by their prior teams to shift priorities and longer-term plans from great quarterbacks who were exiting their primes.

NFL DRAFT STRATEGY

Let’s start by figuring out the optimal strategy at the bottom of the pyramid, which should dictate how we approach the other phases earlier in the offseason. My prior research of surplus value of draft picks by positions shows that there are distinct tiers of positions to target in the draft, especially in the early rounds.

As I discussed earlier, quarterback is the primary must-draft position for elite talent, but among non-quarterbacks the tier 1 to address in the market includes offensive tackles, interior defensive linemen and edge rushers. Specifically for interior defenders, the elite value lies entirely for those who effectively rush the passer, not the run-stoppers of old.

The tier positions (cornerback and wide receiver) provide good value in the first-half of the first round, but not on the level of the tier 1 positions. The gap narrows dramatically in the second half of the first round, basically disappearing as the second round progresses.

Franchises would be well served to avoid all of the tier 3 positions (interior offensive line, off-ball linebacker, running back, tight end and safety) in the first two rounds, perhaps longer. I’ll discuss more in the free agency section how these lower-value positions in the earlier rounds of the NFL also align with the positions that offer the most value in free agency, making them an easy pass with the highest opportunity cost picks.

When we look at trends over time for total draft capital spending by position, you can see how a lot of the trends align with the value findings.

The tier 2 positions of cornerback and wide receiver have had the biggest increases in total spending. This has been mostly driven by a larger volume of picks at the position, as almost every team now needs three competent wide receivers and three-to-four defensive backs on the field at a time.

Edge rushers have the largest total spend by any position (positions are arranged in that manner on the plot top-to-bottom and left-to-right), trending up the last few years after a down 2020 draft. Quarterback has a similar formation, with some down years like 2022 dragging the trend line lower, but a big year coming in 2024.

Offensive tackle has always been a draft priority, but defensive interior players have seen draft capital plummet. I don’t think teams have failed to recognize the value at the position, but it’s more random when great pass rushing prospects will be available, and a decline of wasted early draft picks on run-stoppers.

TRADES

I’d put this as the most underutilized aspect of team-building. It’s also the aspect I think reveals the most about the competence of NFL decision-makers. Meaningful trades are few-and-far between, but that might be more about risk aversion than optimal strategy. I also think NFL contract structures with dead money in almost all deals from signing bonuses may have kept players in the past, but the influx of mega-rich owners into the NFL is already changing the landscape. The Eagles trade of Carson Wentz a few years ago shattered dead money records at $34 million, and now the Broncos are releasing Russell Wilson with more than twice that amount ($85 million).