our value prop is simple

24
September 2013 - Confidential - Do not distribute

Upload: leroy-kane

Post on 04-Jan-2016

38 views

Category:

Documents


3 download

DESCRIPTION

Our value prop is simple. We offer sports fans a way to compete against friends or strangers in daily fantasy leagues for cash prizes. Invite a friend or get matched up head-to-head; the best stats win the cash prize. Choose any 5 players from today ’ s game. - PowerPoint PPT Presentation

TRANSCRIPT

Page 1: Our value prop is simple

September 2013 - Confidential - Do not distribute

Page 2: Our value prop is simple

Confidential - Do not distribute 2

Our value prop is simpleWe offer sports fans a way to compete against friends or strangers in daily fantasy leagues for cash prizes

Choose any 5 players from today’s game

Select entry level and prize amount

Invite a friend or get matched up head-to-head; the best stats win the cash prize

Page 3: Our value prop is simple

Confidential - Do not distribute 3

Optimized for every device

The experience is the same across devices…

Page 4: Our value prop is simple

Confidential - Do not distribute 4

Product demonstration: NFL

View a Demo at: http://bit.ly/16jbVJ2

Page 5: Our value prop is simple

Confidential - Do not distribute 5

Recipe for success

Real traction and success from bootstrapped prototype

Organic private beta launch for March Madness and NBA playoffs with 1k users and yielded the following results in 30 days with no marketing

•2,652 successful transactions, 1,326 successful challenges between users

•$44,390 total transaction volume

•$2,720 of revenue; $1,104 of revenue after 11 days

•$2.72 Average Revenue Per User

•$16.73 average transaction amount

•Largest “whale” handled $10,934 resulting in $656 revenue for FC

•125 of 1,000 customers with over 10 transaction fees

•Happy and loyal customers!

Page 6: Our value prop is simple

Confidential - Do not distribute 6

Business Model

Lucrative business model with no risk 5% - 10% earned from each transaction with no assumed risk

Stakes Entry Fee Total Prize $ FC’s cut

High $525 $1000 $50

Medium $105 $200 $10

Low $2.20 $4 $.40

Page 7: Our value prop is simple

Confidential - Do not distribute 7

Sizing up the market

The market is BIG…and we’ve only just hit the tip of the iceberg.

How big? •It’s estimated that in 2012, +32M Americans spent approximately $467 each, or about $15B in total playing.*•To put this in perspective, football accounts for $11B of that total. The NFL made $10B over that same period.•50% of the population plays a March Madness Bracket•$380B of illegal sports bets are placed yearly in the U.S.Iceberg you say? •Yep, it’s growing at a clip of +60% over the past four years.*•Federal exemption for fantasy sports. •The market for daily, skill-based games is ready to explode.

*Fantasy Sports Trade Association

Page 8: Our value prop is simple

Confidential - Do not distribute 8

Competitive landscape

Fan Duel

DraftKings

Starstreet

Draftstreet

Yahoo Fantasy Sports

ESPN Fantasy Sports

Fantasy Sports – Cash Prizes

CBS Sports

We Are Uniquely Positioned To Win

Attacking new greenfield opportunities at the intersection of online/offline gaming

Attacking new greenfield opportunities at the intersection of online/offline gaming

Differentiated from other Daily P2P sites by simplicity and ease of use

Differentiated from other Daily P2P sites by simplicity and ease of use

Nevada Casinos w/ Sportsbook

Sports Betting – Real Money

Nevada Casinos w/o sports book

Gaming entities outside of Nevada

Sports bar & restaurants

1122

Focus on Friend vs Friend &

Rematches

Focus on Friend vs Friend &

Rematches

Page 9: Our value prop is simple

Confidential - Do not distribute 9

What’s next

Phase 1 - Complete

Daily Leagues in 45 States•Federal & 50 state legal reviews

•Mobile accessible for all devices

•Launched private Beta for NCAAB

•Built multi-sports platform

•9 Patents filed, including:

‐ P2P poker, slots, casino games

‐ Real money fantasy leagues around video gaming

Phase 2 - Underway

Distribution partnerships•Launch NFL, NCAAF, NBA, NCAAB

•Co-branded or partnerships with:

‐ Casinos & gaming entities

‐ Media companies

‐ Social media influencers

•Challenge Friends & Rematch Opponents

Page 10: Our value prop is simple

Confidential - Do not distribute 10

Creating Value for Channel PartnersThere are 216 sports books in Nevada casinos.1 Smaller casinos and casinos outside of Nevada are not generating revenue from sports wagering because of legality, expense or risk.

*As of June 30, 2012

Current “status quo” for Casinos

•Consumer revenue falling from competition

•No inter-state revenue from sports

•Traditional email and mail marketing

New Casino positioning w/FC•Fantasy “sports book” revenue at a small fraction of the expense and risk

•New sports-based draw

•Inter/intra-state revenue from online

•New, more effective ways of reaching patrons via social media

Page 11: Our value prop is simple

Confidential - Do not distribute 11

Turn key revenue stream & valueFC enables venues to create new social, sports-based draws at a small fraction of the cost it would take to build a sports book.

Product & Customer Support

Connected with FC users across the U.S.

$$ $$

$$$

$Social Media Integration

Kiosks On-Site

Co-Branded Website

Page 12: Our value prop is simple

12

How we’re going to grow

Confidential - Do not distribute

User Acquisition ChannelsWeb •SEO, Advertising, buy traffic, freeroll•Virality built in: design promotes social sharing and competition•Social media & celebrity endorsements via Twitter, Instagram, Facebook influencers and sports related celebritiesCo-marketing with Channel Partners i.e. sports bars, on/off-line media, casinos and gaming entities, brands, sports focused websites•Foot traffic•White label/co-branded web presence•Traditional affiliate marketing

Page 13: Our value prop is simple

13

Revenue Projections

Confidential - Do not distribute

4 Year Projections Year 1 Year 2 Year 3 Year 4

Users 92,214 491,200 1,447,446 3,537,935

MARPU $2.70 $4 $5.50 $6

FC 65% 50% 30% 20%

PARTNERS 35% 50% 70% 80%

Revenue $1,463,634 $16,045,809 $68,317,995 $190,853,673

FC 75% 65% 50% 20%

PARTNERS 25% 35% 50% 80%

Expenses ($2,220,469) ($11,020,193) ($32,737,533) ($79,017,755)

COGS ($900,300) ($2,587,077) ($3,854,802) ($4,750,229)

SOFT ($1,320,169) ($8,433,117) ($29,066,376) ($74,503,822)

Profit ($756,836) $5,025,616 $35,580,461 $111,835,933

Page 14: Our value prop is simple

14

Our team

Adam “Ace” Lee, Co-founder/CEO•Sports Tour and Merchandise Company with Seattle Mariners•Visionary in Online Peer to Peer Gaming•Developed and owned over $25M of real estate

Doug DeLuca, Co-founder/Biz Dev & Strategy•Co-Executive Producer, Jimmy Kimmel Live•Connected to major brands and influencers•Former CEO of EliteXC (bought out by Strikeforce/UFC)

Confidential - Do not distribute

Dan Shupp, Free Range Technology •SF-based development shop with operations in Asia•Agile and scrum development system

Page 15: Our value prop is simple

Confidential - Do not distribute 15

Investors & advisors

Adam ShawExecutive

NFL, FOX, CAA

Neal LenarskyChairman

STI Management

Victor LeeVP Digital BrandingHasbro

Chris PetrovicExecutive

GameStop, BetFair, Playboy

CEO Riviera Las Vegas, Wynn Executive in

Macao

Andy Choy Vik LakhwaraExecutive

Reinventures, SK telecom

ventures

Page 16: Our value prop is simple

Confidential - Do not distribute 16

Next Steps

InvestorsWe’ve accomplished a lot with $125K:•Built a strong core team and advisory board•Successfully launched private beta, proving out the MVP with revenue and users•Filed patents in verticals surrounding our core patent

Now we are looking for $1M to knock it out of the park:•Key hires (CTO, Channel Sales/BD)•User Acquisition – Target 100K users with $10 MARPU•Build channel partnerships with venues•Position FC for future phases – P2P Casino

Page 17: Our value prop is simple

Confidential - Do not distribute 17

Appendix

Page 18: Our value prop is simple

Confidential - Do not distribute 18

Appendix: Market size

Market by the numbers:

• Fantasy sports generated $3B - $4B of revenue in 2012

• Nevada’s legal sports wagering represents < 1% of all US sports betting

• Gross revenue for Nevada’s sports books was $170.0m in 2012 on $3.45B of wagering

• The illegal US sports betting market is $380B yearly and $19B in revenue

Page 19: Our value prop is simple

Confidential - Do not distribute 19

Appendix: Player Acquisition

We’ve developed a pipeline of media partners that reaches an audience of more than 1.5M via social media e.g. Twitter, Facebook, and Instagram. • Leanna Decker – Model, Blogger

• Brittney Palmer – Model, Blogger

• Bert Fentress – Fantasy Sports Guru

• @blackredsoxfan – MLB Pro Blogger

• @rotofanatics – Fantasy Sports News

• @mlbinjurynews, @hoopsinjurynews – Sports injury news and updates

• Chris Myers – Fox Sports announcer covering NFL, MLB, and Nascar

• @fantasycouch – Fantasy Sports Guru

• Lysette Tan – Blogger, Model

• Kourtney Reppert – Model, Blogger

• Sophia Santi - Model, Blogger

• Sports Media 101 - 120 micro blog sites

• Jordyn Taylor – Singer, Blogger

• Sports Fan Addicts Sports Bar, Honolulu - Bar

Page 20: Our value prop is simple

Confidential - Do not distribute 20

Appendix: Legal

Fantasy sports is considered a game of skill and received specific exemption from the 2006 Unlawful Internet Gambling Enforcement Act.

Additionally, Fight Club has gone further to ensure the legality of its services and compliance with federal and state laws by conducting:

•50 State legal review by recognized gaming expert Tony Cabot showing strong legal standing in 45 states

•Federal legal review by I. Nelson Rose

Page 21: Our value prop is simple

Confidential - Do not distribute 21

Appendix: Market activity

The fantasy sports and gaming industry has been brimming with activity.Select Recent M&A Activity:

•Bignoggins acquired by Yahoo! – July 2013

•Double Down Casino acquired by IGT for $500M – January 2012

•Playtika/Slotomania acquired by Caesars for $160M to $180M – January 2012

•BetFair successful, $2.4B IPO (UK) – October 2010

Select Recent Financings:

•Topline Games $25M Series A – June 2013

•DraftKings $10M Series A & PE – May 2013

•FanDuel $11M Series C – January 2013

•Starstreet $600K Angel/Series A – February 2012

Page 22: Our value prop is simple

Confidential - Do not distribute 22

Appendix: Patents filed

Patent Description Impact

Utility application #: 13843750Filed March 15, 2013

• P2P Casino - Allows users to play casino games peer to peer with one user acting as house and another user or users acting as players.

• Removes the house and allows for a transparent, profitable, peer to peer platform.

Patent Application #: 61827447Filed May 24, 2013

• P2P Backyard – Allows users to place and lay bets simultaneously in casino games

• A fluid table with true odds and no need for a house

Patent Application #: 61827431Filed May 24, 2013

• P2P Slots – Allows users to pick a slot machine, bank it and open it for other users to play. 100% payout.

• Allows user to play on both sides of the slot machine experience, users gets true odds

Provisional Reference #61816698April 26, 2013

• Multiple Sportsbooks - Allow sports book to display multiple sports book feeds and lets players bet on any feed from one or multiple accounts.

• Best odds on all sports bets for a player. House can lay action to other sports book.

Page 23: Our value prop is simple

Confidential - Do not distribute 23

Appendix: Patents filed (cont’d)

Patent Description Impact

Application #61869457August 23, 2013

• P2P Video Poker – Allows a user to bank a video poker machine and lets a user play the machine against the player acting as ‘bank’.

• Allows users to bank a video poker machine and leave it open, or play for true odds against another user.

Application #61871872August 30, 2013

• Forming a fantasy video game team and competing against another user’s team for cash

• Monetize the huge amounts of traffic that is generated by video game players

Page 24: Our value prop is simple

Confidential - Do not distribute 24

Appendix: Web assets

List of Domain Names

• FightClub.com• Pick5.com • P2Pgambling.com • P2Pcasinos.com• P2Pcraps.com• P2Pslots.com• P2Pbaccarat.com • P2Proulette.com• P2Pkeno.com• P2Pbingo.com• P2Ppaigow.com