- Sports Betting
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- Daily Fantasy Sports
While the daily fantasy sports industry in the US prepares toward the upcoming NFL season and the revenue that comes from daily fantasy football, at least one company has it sights set elsewhere.
Global Daily Fantasy Sports, a publicly traded company on Canada’s TSX Venture Exchange (TSX-V: DFS), will be entering the DFS market in Q4 of this year, according to new COO Justin Shulman, who was announced in that position on Tuesday. But it won’t be in the US, and it isn’t a consumer-facing platform product like DraftKings, FanDuel and the other main DFS operators.
Instead, Global, a business-to-business product will focus on entering European regulated markets at the end of this year. It will launch with a competitive advantage thanks to an exclusive distribution deal it recently inked with NYX Digital Gaming, a part of the NYX Gaming Group.
NYX will offer its existing business relationships with gaming operators and casinos across the globe a new revenue stream in the form of Global’s DFS product through its sales and marketing arms. Clients already using NYX’s Open Gaming System (OGS) will enjoy the benefit of a seamless B2B integration affording them an opportunity to bring a DFS product to market with few technical challenges. Sports betting companies like Bet365, William Hill, Paddy Power / Betfair, SkyBet and Gala Coral all work with NYX already.
Operators who join the Global network will be afforded the opportunity to run both ring-fenced contests exclusively for their customers and will benefit from Network contests where liquidity is shared amongst all operators under the Global umbrella.
Global has already raised $8 million — $6 million via a non-brokered private placement financing — and was oversubscribed, according to Shulman.
The news this week for Global is the appointment of a new executive who comes from the world of North American DFS. Shulman, a co-founder of DFS operator Fantasy Feud has been immersed in the industry since 2011, was named the company’s COO.
“Justin joins Global with a wealth of fantasy sports experience,” Darcy Krogh, Global’s President and CEO, said in a press release. “We are thrilled to have his expertise as part of the management group and look forward to expanding our operational team under his guidance as we get closer to the launch of our European facing daily fantasy sports product.”
Shulman said the opportunity to work with Krogh, who formerly co-founded Chartwell Technology, a B2B European platform (before it was bought by Amaya) and also worked at NYX was a big driving force to jump back into the industry.
“What resonated most was that the plan involved being able to integrate seamlessly with a shared wallet concept for operators, as opposed to trying to move people to a third-party site like we have seen others attempt,” Shulman told Legal Sports Report.
“The fact that Darcy had an existing working relationship with NYX and was able to bring our fantasy concept to the table with exclusive rights into their OGS platform, provides us market credibility from the start,” Shulman continued. “We have built a true B2B product built specifically for regulated markets with the operators needs top of mind rather than taking an existing consumer-facing platform and pivoting the business model.”
According to Shulman, the initial Global DFS platform will offer five major European soccer leagues — English Premier League, La Liga, Bundesliga, Ligue 1 and Serie A — for immediate play, as well as contests based on the PGA Tour and the European Tour in golf. Without giving too much away, he said there will be a North American DFS feel with salary-cap and pick’em-style contests as staples.
Shulman says Global plans to be in the UK, Italy and Scandinavian countries early on, with plans for more European expansion — and even Asia and Latin America — down the road.
Phase two of development will roll out additional sports and new innovative niche game types, a strategy that helped put Feud on the map. Shulman mentions that the ability to operate outside the fractured DFS North American market allows for more creative flexibility in contest/game design that will cater to sportsbook customers.
The Global DFS product will be on display at the NYX booth at G2E.
Shulman, who spent a great deal of effort building up Fantasy Feud, said some of the challenges that exist for B2C DFS in North America are a non-issue in B2B DFS in Europe, despite the fact that it is still a fledgling product across the pond.
“Customer acquisition just got so expensive and so competitive that it made it really challenging … profitability was just so far into the distance [at Fantasy Feud],” Shulman said. (Fantasy Feud recently sold its user base to another DFS operator, Fantasy Aces; Shulman had left Feud well before this happened.)
“What I am most excited about is starting from a point where the end users already have a registered account and comfort level with the operator. It’s back to the basics conversion tactics,” he continued. “When we partner with operators, they are going to bring to the table active users that I could only dream about at Fantasy Feud. Our acquisition costs are much more favorable with this model.”
Shulman said he believes the Global product — and the user engagement he saw on the B2C side — will be a welcome addition for European gaming operators already using NYX technology.
“Users are already out there playing sportsbook, casino, bingo, slots, poker; in some ways, this is just another potential revenue stream,” Shulman said. “To make a sports bet is a click of a few buttons and you are taking one side of a bet. Playing DFS, you’re constantly engaging with the app because you don’t know who your competitors have on their teams. The engagement that is required for DFS offers an unlimited amount of cross marketing opportunities at the operator level.”
Most European-facing DFS operators, B2C and B2B alike, are already in the UK. DraftKings and FanDuel both received gaming licenses there this year.
But other countries have been added to the mix of late, as well: