Fanduel - A Scottish success

This week I went along to Edinburgh University Business School to hear Nigel Eccles, CEO of Fanduel, give a talk run by Informatics Ventures.

Fanduel have an online fantasy sports site where players can pick their own sports teams then play them against other players either head to head or multi-player.  

It has several distinguishing characteristics:

• It is entirely focussed on North American sports, particularly NFL, NBA and MLB.  This has a current market of around 35 million players so there is huge potential.
• Their games run over a period of one day or one week. In stark contrast to most fantasy sports games, which go over the whole sports season, Fanduel games are over quickly - especially attractive to the younger demographic.
• You can bet on the games.  You can also play for free, but betting on your skills in Fanduel games can be lucrative - one star performer has so far won $492,692!

The history of the company is far from straightforward.  Nigel and the four other founders started out around 8 years ago with an online product called HubDub that was based on news stories and predicting how they would progress.

After a highly successful launch at TechCrunch in California, things looked pretty rosy for HubDub; angel and VC funding, positive reviews, success looked assured.

Change of tack

However, subscriber numbers slowed, and the feeling something wasn't clicking began to nag them.  They knew the sports stories were by far the most popular on HubDub and decided to change tack - and Fanduel was born.

Nigel's talk took us through a lot of the ups and downs they went through and it was a bumpy ride.  For example, having secured more funding, things were really starting to fizz when the NBA and NFL lockouts came along and knocked the wind out of their sails - overnight, their main earning games disappeared.

Things like this would have most people looking for the exit door, but they are merely 'lessons learned' to the true entrepreneur, and of course, they found a way through them.

Advice

Nigel also shared a few things that any budding company could pay heed to:

• Launch as early as possible
• It's unlikely you will find a silver bullet hire or idea from outside.  The answers are probably already inside your company.
• Keep the founders together (especially if one of them is your wife!)

The company now have a New York office for sales and marketing, but most of the development engineering is still done from their TechCube office in Edinburgh.

Their monthly revenues are now in the millions of dollars and they've paid out over $50m in prize money.  They're continuing to re-invest to grow their market.  

They're a Scottish success story.