Quote:
Originally Posted by Buffalo66
Profitability may become a bigger issue down the road. FD/DK are spending lots of VC money to build market share and also relationships with the sports leagues. Their world will be big enough that if/when they launch an IPO, the founders will become very rich.
Then these eventually huge public companies will be all about the bottom line.
While it is a huge growth industry right now, how much longer will it continue to grow exponentially? Handing out big cardboard checks and trips to the Playboy mansion is great, but it seems like the casual guy fan market is being penetrated right now. ESPN, NBC/Rotoworld, NBA, NHL, sports radio all offer DFS promotion or content.
The casual girl fan will probably never respond to those marketing efforts (especially when DK commercials talk about getting super models in your underpants). I know plenty of women who have discretionary income and are sports fans - attend NFL/NHL games and even play season long fantasy with friends - but they are spending their money on wine and pumpkin spice lattes, not a milly maker ticket.
Also IMO legalized sports betting will kill DFS growth because Joe Public degens would rather place $20 on the Cowboys than take time to fill out a fantasy lineup. Sports betting is coming, it's just a matter of time.
I agree with all of what you said, save the last graph. Because of at least two-decade long experience with fantasy football leagues, the casual sports fan would be just as inclined to fill out a DFS lineup as to sportsbet, if not more so.
Although I live in Vegas and have friends who actively sportsbet, it's always seemed too "gambly" for me, despite being a professional poker player. Although DFS is more luck-based than poker (you have zero control over whether John Wall strains a hammy in the first quarter or getting "Pop'd" with the Spurs resting their aging starters, but I can always fold to a river raise if the board runs out super scary), it's still largely a skill game with lots of information out there on how to improve. While delving into the DFS grind has taken me right up against the line of pure sportsbetting (a bit uncomfortably so), I never would have gotten into it if it weren't for my 15 year experience with season long fantasy football.
I'd "bet" my experience isn't merely anecdotal.