FanDuel Making Key Company Numbers Available to the Public
The beautiful part about the DFS industry today is that despite how much it’s grown over the last two or three years, much of the people involved still envision a healthy growth period coming in the future. One way to get this idea across to new users (quickly) is to compare the prize pools of the year-end championships in 2013 to seasons just a few years in the past. As I glance over an article about the 2011 FFFC (FanDuel’s year-end NFL championship), a tournament which paid out $150,000 in prizes – including $75,000 to 1st place – it’s clear that the size of the prize pool was extremely exciting at the time, for FanDuel and their users. The $150,000 (and the $75K to 1st) was the biggest prize pool in the history of DFS, for a short time at least. Fast forward to the 2013-2014 NFL season, and we saw three sites offer multi-million dollar end-of-season NFL championships. Three people became instant millionaires after just one day of football, and even the 2nd and 3rd place prizes were paying out six figures, more than most families take in per year. Not only was this true for the 2013 FanDuel FFFC, but also for the year-end championships on DraftKings and DraftStreet.
That’s just one of the shorter, more concise ways to help explain the “boom” in Daily Fantasy Sports, but there are quite a few different ways to get the point across. One man that was (and still is) particularly skilled in convincing the business world of the potential of this industry is FanDuel’s CEO Nigel Eccles. Back when Daily Fantasy Sports was still in it’s relative infancy, Nigel and his team at FanDuel were working endlessly to convince investors of the upside that exists here, and after a bevy of failed attempts they were able to secure the funding that has given them the room to grow into the leader of one-day fantasy sports.
As the market leader in this industry, it makes sense for the team at FanDuel to want their customers and partners to be kept up-to-date on their growth and performance. Since it’s birth in 2009, FanDuel has been focused on building a long-term business that is profitable and sustainable, and it’s important for the public to know how that business works. Now more than ever, outside parties are building great businesses based off of one-day fantasy sports, whether it be content-based sites or communities like we have here at RotoGrinders. With FanDuel now sharing it’s key numbers, prospective businesses are able to see just how far this industry has come in such a short period of time.
At FanDuel, the way the company makes money is the difference between entry fees and prizes. This is what equates to the company’s revenue; if they have a tournament where the total entry fees are less then the prizes awarded, they account for the difference as negative revenues, and net it against their revenue figure. FanDuel will now allow the public to view quarterly information regarding entry fees, prizes, revenues and paid active users dating back to the 1st quarter of 2011. The up-to-date chart appears above (excluding April and May of 2014, which you can find directly on FanDuel’s site). They are projecting around $6.5 million in Q2 revenue, and are expecting roughly $40 million on the year.
For anyone who works in or is involved with the Daily Fantasy industry in any form, the data above should bring a smile to your face. The number of entry fees, prize pools and paid users (3,198 paid actives in Q1 of 2011, over 192,000 in Q4 of 2013) today are staggering when you compare them to the figures of just a few years ago, and it not only helps to illustrate the success of FanDuel, but the popularity of one-day fantasy sports as a whole. The future is bright!