Q&A: Dan Cook, co-founder, Fanamana

As far back as 2015, leading European sportsbooks like bet365 were reporting that fully three quarters of their revenues came from in-play wagering. Indeed most sportsbooks have spent the last few years allocating their product development budgets to in-play improvements, including various forms of cash-out, more live streaming and streamlining UX.

And yet despite the obvious appeal of in-play products, the DFS industry has yet to really embrace it in the same way as its betting cousins. FanDuel and DraftKings’ live offerings are limited to line-up monitoring apps, with no plans for change in the immediate future.

DraftKings at least pays lip-service to the importance of in-game engagement with its Live app which it describes as the “digital and fantasy-focused version of NFL RedZone”, while FanDuel also powers the NBA’s free-to-play in-play prediction game.

However, the paid in-game fantasy space has been left largely to start-ups like Fanamana which operates InGame Fantasy, a format designed to mimic real life sports action and allow players to play against other players rather than scripts and algorithms.

The MLB version of InGame Fantasy asks users to draft up to three players that are in the on-deck circle of a baseball game in real time. That batter’s outcome is applied to each team’s virtual game. If your first batter strikes out, you have one out in your first inning. If your second batter doubles, that’s a runner on second, and if your next guy homers, that’s a two-run shot.

The team behind InGame Fantasy claim they are seeing “off-the-charts engagement”, with average session times of almost 24 compared to an average session length across all mobile apps of less than six minutes, according to data from mobile marketing platform Localytics.

And while the unique format levels the playing field for users, it also helps avoid the legal questions that start to arise when in-game predictions start to mimic prop bets – the NBA for instance kept their game free-to-play due to regulatory questions.

Below, Dan Cook, the co-founder of Fanamana, explains how his firm plans to capitalize on the unique opportunity to engage DFS players once the games have kicked off.

EGR North America (EGR NA): When did you first recognize the opportunity for in-play fantasy?

Dan Cook (DC): I’m a season long player, and I would sit on the couch watching games and I’d have forgot to put in a starting pitcher, and it just seemed frustrating that I would have to watch the games live and not be able to do anything about it. It seemed obvious to me there should be a way to interact with the game.

So I looked for someone who was doing that and couldn’t find anything in the space. This was around 2012/2013 and DFS was taking off. FanDuel and DraftKings were finding their feet but I wasn’t necessarily trying to do DFS as we know it. What I wanted to create was much more of an interactive fantasy game.

We didn’t want the game to be about an accumulation of statistics, so for baseball it plays and scores like baseball and it will be the same for our future games in American football and golf.

EGR NA: So was the plan always to charge a fee to enter contests, or did growing up alongside the DFS industry influence you?

DC: The DFS industry has definitely influenced us as we looked for a viable business model. The real-money contests seem like the best way to turn a profit. We don’t come from a gaming background or even a DFS background. We just saw a gap in the market, and as we looked to turn a profit, that’s where DFS came in.

EGR NA: With the relative dearth of in-play fantasy options, who do you see as your main competitor in the space?

DC: A lot of what’s been done is in the predictions sphere.  What’s going to happen in the next play for instance, is more along the lines of prop betting and we want to stay away from that. We think we’re the only ones doing in-game fantasy. Others are doing these predictions which are fun – the biggest right now is probably Boom Fantasy which is a hyper engaging product.

But that’s actually an area we can differentiate ourselves, because we want to appeal to a more casual fan. While our game can be played as a second screen, it’s not a requirement. You can play at you own pace without watching and it’s not hyper engaging, it’s a little more casual.

EGR NA: Are all your players DFS players, or are you attracting a new audience?

DC: Almost all of our players have accounts with the main DFS companies. We see ourselves as complementing them rather than competing with them. We think our players will put their line-ups in with them then come and play with us during the game. We don’t have actual numbers but I’d guess almost all our players have traditional line-ups going the same day. The research can obviously carry over, so it makes sense.

EGR NA: Is it therefore a concern that FanDuel or DraftKings might introduce an in-play product and take these customers?

DC: They have enough on their plate right now but yes, it’s the logical next step in the industry to me because it complements rather than cannibalizes the current users.

But I think our focus is different from both companies. With or without a merger, they are in a difficult situation because their product has grown up in an ecosystem that caters to the players who enter 10,000 contests a night. While they say they want to make changes that would be good for the majority of the players, it would hurt their metrics.

We are going to keep our heads down and create fantasy contests that are interactive, fair and most importantly, fun to play.  As Paul Graham of Y-Combinator says: “Better to make a few users love you than a lot ambivalent.”

EGR NA: Does in-game fantasy lend itself to a more recreational player in a way that traditional DFS doesn’t?

DC: I do think it’s a better product for the casual player. The sharks and big spenders- they can do thousands of DFS tournament entries using software, but you can’t do that in-play. It’s a completely untapped market and I think the casual fan will end up on season long fantasy and in-play. You’re playing against real people, not scripts. Anyone can join a game at any time of the night. As soon as one contest is filled, another one opens. There will always be open games to enter and people don’t have to worry about liquidity, weather or line-ups.

EGR NA: As the industry starts to regulate across the various states, a lot of smaller operators are struggling with the taxes and license fees. How are you dealing with that?

DC: Any state that charges a large fee, we just withdraw. At this point we don’t make enough to pay a $50,000 license fee. Virginia and Indiana are places we’re restricting even though it’s legal. It’s a click of a button for us to turn certain states off since we’re mobile only.

Where possible, we comply so we have a temporary license in New York for instance. Is it a burden? Yes. For a company like us it’s very challenging.

EGR NA: Do you see an opportunity for in-play fantasy in Europe?

DC: Maybe on a B2B level if we had some partners who were interested in one sport, in one market. We have our core focus here but if there was a partner who could open things up, that’s something we’ve talked about conceptually.