Flowplay CEO sees social sports betting opportunity over DFS  

The potential failure of the mega merger between FanDuel and DraftKings is good news for the social sports betting sector, according to one prominent chief executive.

Talking to EGR North America, Flowplay CEO Derrick Morton said the skills-based games business model is, and always has been, fundamentally flawed. “With the model built so a very small percentage of the most hardcore, data-driven players are able to actually win, a majority of players engaging with these types of games always ends up on the losing end – leading to detrimentally high player churn rates,” he added.

Flowplay’s CEO has questioned the viability of DFS since it first became a national frenzy in 2015, and told EGR NA he wasn’t shocked to hear of the massive operating losses over at DraftKings and FanDuel. “While hundreds of millions have been gambled within DFS games over the last couple of years, between big payouts going to a small group of sharks and the high player acquisition costs versus low retention rates, little room is left for actual profit.”

Despite the millions in funding that has been poured into DraftKings and FanDuel, Morton believes the model remains unsustainable, and financing will likely dry up years before online sports betting becomes legal in the US.

Morton argues that the only viable approach to DFS and online sports betting in the US is through social sports betting. “By applying similar free-to-play mechanics as the $4.4bn social casino market, there’s a huge opportunity to tap into a much larger base of casual fantasy players and do so in a widely-legal, sustainable way while taking advantage of the current industry hype.”