20 Things You Didn’t Know About FanDuel
Fantasy sports is becoming a big deal in the United States. FanDuel is one of the most popular providers in the United States. We were checking them out and we found some interesting facts about them that is worth sharing. These are things that most people, including those who actively participate in fantasy sports probably aren’t aware of, so here are 20 things that you didn’t know about FanDuel.
1. They are ranked as the second largest fantasy sports providers in the U.S.
This is an interesting fact that we learned about FanDuel. The New York City company comes in second place to DraftKings. They got their start a little later so FanDuel has not yet caught up to the first major provider to come on the scene, but they’re doing well enough. This ranking has been established by a comparison of the entry fees paid and the number of participants in the user base.
2. The FTC blocked their merger with DraftKings
FanDuel had made an agreement with DraftKings, the number one ranked provider, to merge the two companies. They reached a mutually beneficial agreement in November of 2016. Because of the large size of both companies, the Federal Trade Commission denied their request to complete a merger legally. hey threatened litigation of they two giants pursued the merger. The reason for this is because bringing the two massive providers together would take up a very large percentage of the market share and it would have created a monopoly. This is an illegal practice, so in order to avoid anti-trust lawsuits, they called off the deal in 2017.
3. FanDuel was acquired by an Irish company
In May of 2018, an Irish bookmaker that goes by the name of Paddy Power Betfair purchased FanDuel. This was accomplished with the understanding that FanDuel would become the main brand of the company and the name under which it operated would not be changed. FanDuel would become the lead agent for the newly merged company that provides legal sports betting in the recently established and legally approved market.
4. FanDuel was officially founded in 2009
FanDuel became official on July 21st of 2009. The company was established by five co-founders. These were Tom Griffiths, Rob Jones, Chris Stafford, Lesley Eccles and Nigel Eccles. The sports betting company was a pivot from a news prediction site that was called Hubdub. It took more than a year for the new company to get its feet firmly established and its infrastructure in place to begin operations. They held their first Fantasy Football Championship in 2010. This was the beginning of an enterprise that would blossom into a mammoth in a short period of time. Although they were not the first to offer fantasy football services, they did offer an alternative to the first company, DraftKings.
5. They got a big boost of funding to start
FanDuel was an expensive business to get started. The overhead was massive, but with the success of DraftKings, it seemed like a sure bet and a good venture to back financially. The initial round of venture capital came from the two funders Sottish Enterprise and Pentech Ventures. They invested $1.2 million in funding to get the new business started. It was an investment that would pay off big time over the next few years.
6. The first event was really small
The very first event that FanDuel sponsored was a small affair, but the payouts were decent. There were just ten users who gained entry into the event by winning competitions earlier. There was a total prize pool in the amount of $40,000 at stake. The winner of the first prize received $25,000. This made the competition interesting and profitable for the lucky winner. Contestants had to participate in a fantasy football league for the entire NFL season that would qualify them for entrance into the contest.
7. FanDuel Received more funding to expand
FanDuel would have reached its maximum capacity for operation if it had not expanded its infrastructure. There was a huge need to ensure that the company could accommodate the droves of new users who were signing up. They held another round of funding in January of 2013. Investors put yet more into the highly successful venture with a round of Series C funding that yielded $11 million in funds. This went on again in September of 2014 and the Series D funding round yielded $70 million. In 2015, yet another round of Series E funding brought in a massive $275 million in additional funding on top of the other amounts that were previously invested. This brought the company to an estimated value of more than a billion dollars.
8. FanDuel Acquired an analytics company
In September of 2015, FanDuel made its first official acquisition. They purchased an analytics company by the name of numberFire. This increased the size of the giant even more than it had been previously The services provided by their acquisition helped them do a better job of providing analytics for their registered users.
9. They made their third acquisition in the same year
FanDuel wasn’t done with their expansion. They also acquired AlphaDraft in the same year. This is a DFS service with their main focus on e-sports. It was an ideal pairing because the company offered services that were in line with FanDuel’s current needs to expand, plus, although the company was much smaller than FanDuel, prior to the acquisition, they were, on a smaller scale, still competition. FanDuel had successfully acquired two companies in the same year.
10. A DraftKings employee won big on FanDuel
Here is a fact that we found to be very interesting. The New York Times reported a story about a surprising event that took place in October of 2015. A user on FanDuel that worked as an employee of their competitor DraftKings won $350,000 on the FanDuel website. The employee had “inadvertently” let data out prior to the beginning of the third week. We’re not sure if this could be considered unethical or not but it certain seems ironic to us.
11. DraftKings employees made bank off FanDuel
We also discovered another interesting fact that is related to the DraftKings employee who won the $350,000 off of the FanDuel site. It seems that employees of DraftKings were making a habit out of winning on the FanDuel website. The statistics show that in all, employees of the competition had won a total of $6 million from FanDuel. It’s worth noting though that this is a very small percentage of the two billion dollars in prize money that they’ve handed out. The DraftKings employees who were winners on FanDuel only made up 1.3 percent of the pool of winners. In a way, it’s a compliment to have the competition’s employees bet on your boards.
12. FanDuel and DraftKings drafted new policies over the event
As a result of DraftKings workers playing on the FanDuel site, the two companies saw the potential for trouble and they drafted new employee policies. It is now prohibited for employees of either of the giant fantasy sports providers to register and play on the site of their competitor. Until the issue was brought to light, it had been an oversight and when they realized what was going on, both companies took immediate action. We’re not sure if FanDuel employees registered on the DraftKings site or not.
13. FanDuel also acquired Kotikan in 2015
Around the same time that FanDuel purchased numberFire, they also acquired Kotican. This was a company that developed the mobile app for FanDuel and this is what helped them to make the decision to bring the company in-house. It was a wise decision to bring the company into the fold. It represented the third major acquisition for the year. In addition to this, FanDuel also hired a large group of employees who had been laid off by Zynga 365 Sports. In all, 42 Zynga workers had been laid off and FanDuel hired 38 of them. This was an act that helped out a lot of people who were in need of jobs, but it brought more seasoned professionals into the fold of FanDuel.
14. FanDuel and DraftKings were sued
The Massachusetts Attorney General’s office pursued allegations that both of the fantasy sports giants had engaged in practices that were considered to be deceptive and unfair. The allegations claimed that these practices occurred before 2016. Both companies settled the law suit and it cost them a pretty penny. In all, DraftKings and FanDuel each ended up paying an equal amount of $1.3 million to settle the matter. This was a lot to pay out but neither of the company suffered monetarily. They’re billion dollar businesses, but the damages were not good for the reputations of either company.
15. FanDuel changed leadership recently
Nigel Eccles, one of the co-founders of the company made the decision to turn over the reigns of FanDuel in November of 2017. The CEO was succeeded by Matt King. Matt had previously served in the capacity of Chief Financial Officer and his skills were well respected by members of the board. It wasn’t long until another of the co-founders decided to leave the company also. Tom Griffiths left and in his place, the former Head of Product of the acquired company NumberFire, Nik Bonaddio, took his place. 2017 was a year of change and transition for FanDuel with some major changes taking place within its leadership. We could not find out why the two co-founders made their decisions to leave FanDuel, but it’s not uncommon for founders to step away from leadership or management roles. They had both stayed with the company for several years.
16. Paddy Power Betfair acquisition came during a turbulent time
The FanDuell sale to Paddy Power Betfair expanded the company to include sports betting. Paddy Power Betfair only obtained a 61% controlling stake in the company but they did reserve the option to up its stake at an incremental rat of 80% and then later to achieve 100% of ownership throughout the passage of time. The precise amount of time was not stipulated. The sale of FanDuel came after the establishment of the Professional and Amateur Sports Protection Act of 1992. This act outlawed sports betting in the United States in nearly every state. The Act was subsequently taken before the Supreme Court where is was found to be unconstitutional. This opened the doors for FanDuel to begin this type of activity and to do so legally.
17. FanDuel moved into Racetrack betting in 2018
This is yet another sport that FanDuel added to its portfolio. After the Paddy Power Betfair acquisition, the company opened up a sports book at a New Jersey racetrack called the Meadowlands. As agreed upon during the sale of FanDuel, their name remained proprietary for all new operations.
18. FanDuel first offered Hockey in 2018
The major focus had been upon NFL fantasy sports betting. In November of 2018, FanDuel struck a deal with the National Hockey league to become their first official daily fantasy sports as well as betting partner of the organization. This was a first for the NHL as well as for FanDuel.
19. FanDuel has received a lot of recognition and awards
FanDuel has done an amazing job doing what they do best. In 2016 they received the Webby Awards for Best Sports App on a handheld device. They also received this awards in 2015 from Webby Awards along with the People’s Choice Award for the best mobile sports App and the Judges selection as well. In 2015 they also received a Best Industries award from Inc Magazine.
20. The accolades keep coming in
In 2014, FanDuel was named as the Fantasy Sports Trade Association’s Best Daily Fantasy Sports Contest as well as the Best Daily Fantasy Mobile App and Best Fantasy Live Event. They also received the Best Daily Fantasy Product for both web and mobile award. They were given multiple other acknowledgements begining in 2010 with the Heraldscotland.com Global Ambition award and Mashable’s Sports Innovation Index award.
