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And what amounts to their biggest competition — the likes of Yahoo, Fantasy Draft, Fantasy Aces and DraftDay — have taken the same basic approach to DFS as those two companies. That’s the so-called “salary-cap” model, where users draft a roster of fantasy players. (Another competitor in the space, Draft, offers a different take on DFS but still relies on selecting a roster of players.)
The events of the past year have generally slowed what was an influx of investment and accompanying innovation in the DFS space.
But at least three companies have been ramping up their products this NFL season, using the concept of “fantasy sports” to what amounts to prediction-based and in-game contests that diverge wildly from the DFS market as currently situated.
What are these sites up to, and where are they headed?
Here’s a look one of them: Boom Fantasy.
Boom Fantasy CEO and co-founder Stephen Murphy believes the future is in fantasy, but in a different realm than the one dominated by the “big two.” Murphy has been involved with real-money gaming for about a decade, including consulting MGM Resorts International on fantasy sports.
“Fantasy sports right now is a crowded landscape,” Murphy said in a recent interview with Legal Sports Report. “If you look at competitors of DraftKings and FanDuel, I think you’re in a tough spot if you are just trying to outcompete them in terms of your software, in terms of your offering.
“If you have a product that is remotely similar to what their product is, I think people are just going to go to where the liquidity is. In some ways, the war has been won when it comes to salary-cap lineups.”
The in-game model is what sets Boom Fantasy apart, Murphy believes.
“We have a product that is very differentiated,” Murphy said. “Our key, flagship product is this play-by-play format where fans can play as they are watching the game.”
Boom Fantasy gained some attention in January when it launched, along with announcing that it had received $1.4 million in funding, led by Zynga CEO Mark Pincus.
The idea behind Boom Fantasy is “fantasy-esque” but is certainly not “fantasy sports” as most of would recognize it.
It’s now live with an NFL product (and NBA, for that matter, along with an MLB product earlier in the year). There are two basic iterations of their game: In-game prediction contests and more standard prediction contests where choices are made before the underlying games begin.
Here is how the in-game version works:
Here’s how the more standard contests work:
Here’s an example from an upcoming NFL contest:
In reality, Boom Fantasy runs up against many of the same hurdles as traditional DFS. Like the rest of the DFS market, it operates under the auspices of the federal UIGEA fantasy sports carveout, and the same claim that is a game of skill and not gambling in the states that it serves.
(And much like the larger DFS industry, there is also some question of whether it could possibly run afoul of the federal law PASPA, although a challenge on this front from the major pro leagues seems unlikely.)
Boom Fantasy serves 37 states, according to its terms of service. (By contrast, DraftKings and FanDuel both serve about 40 states, currently.)
Boom Fantasy is looking to be in regulated markets, however; for example, it has applied for a temporary permit in New York. The way Boom Fantasy is constructed, it fits into the state laws regarding fantasy sports that have been passed this year.
The events of the past year on the legal and regulatory fronts don’t worry Murphy, he said.
“We’re not daunted by the environment,” Murphy said. “I think anyone who didn’t see this happening was probably not too clued into the legal uncertainty.”
Murphy also notes that his company works with Jeff Ifrah, who is widely considered one of the best gaming attorneys in the country.
The in-game aspect of Boom Fantasy and some of the others in this niche of products — notably WinView Games and ringit! — is what Murphy believes gives his company a chance to scale.
The DFS market dominated by the “big two” misses out in some ways, Murphy said, and that DFS captures a market already likely to watch a lot of sports and games. He said he has talked to people in the sports industry that agree with that assessment of the current DFS market.
“I think some of the teams and leagues are not as convinced that DFS moves the needle for the casual fan,” Murphy said, saying Boom Fantasy’s game play is more tailored to someone not interested in the investment of time needed for setting DFS lineups.
“And for our product, we think that we do increase consumption,” Murphy said. “Our users are watching more and watching for longer.”
In-game fantasy isn’t really designed to replace or supplant DFS, Murphy said.
“We see [Boom Fantasy] as a complementary product,” Murphy said. “You can play FanDuel and DraftKings up to kickoff; once kickoff happens, we see users start to engage with our platform.”
He also noted that the platform is pretty “sticky” in that users that try it are being retained at a solid rate. Fifty percent of all Boom users still actively play and enter real-money contests 30 days after depositing, according to Murphy. One-third of players are still playing after eight months.
As a point of reference, in October, Murphy said more than $180,000 in prizes were awarded. That’s obviously small potatoes compared to DraftKings and FanDuel, but represent good numbers for a start-up that is less than a year old.
Boom Fantasy is growing at a rate of 200 percent quarter-over-quarter:
Murphy also said he believes Boom Fantasy captures the social nature of watching sports and season-long fantasy that DFS in some ways can miss.
“If you think about how you watch sports, or how you watch sports with friends, it’s sometimes hard to have a natural conversation about DFS,” Murphy said. “Something like ‘I think Tom Brady should be worth $10,400 this week.’ That doesn’t really roll off the tongue.
“What is easy to do? Elbow your buddy in the side and be like ‘Tony Romo is totally going to throw an interception on this play.’ And that kind of gameplay, we can capitalize on. I think our product is inherently social in how it’s consumed and how it’s shared.”
To that point, much of its customer acquisition has been through organic means, like direct referrals, Murphy said.
Boom Fantasy believes it has a product that has a future for meaningful growth outside of the traditional DFS model. But it’s not alone in that thinking.