New Fantasy League Site Swagger Stadium One of Few to Embrace March Madness
WAYZATA, Minn. -- When the annual college basketball tournament known as March Madness gets underway in a few days, most Internet-based fantasy sports leagues won't be involved, for various reasons.
But one start-up fantasy sports league, based in this Minneapolis suburb and called Swagger Stadium (www.swaggerstadium.com), wouldn't think of ignoring America's second-biggest sporting event (after the Super Bowl).
Swagger's decision is well appreciated by NCAA hoops fans, and the move has certainly helped put the new fantasy league in the spotlight during the madness of March.
Gambling 911 last week traveled to the famed Land of 10,000 Lakes to visit Swagger Stadium headquarters and chat with the company's co-founder and chief executive officer, Travis Hills, to find out, among other things, how he's bucking trends that other fantasy sports leagues strictly adhere to.
Here is a transcript of that interview:
Gambling 911: How does your fantasy operation work and how is it different from the many other fantasy leagues out there? What states and countries are you legal in and how do you stop players who are not in those locations from joining? And what is the age limit to join and how do you verify that?
Travis Hills: We offer the most unique and exciting fantasy sports experience in the world. It is free to sign up and we offer new fantasy leagues every day. Our customers can play in daily fantasy leagues in seven different sports, with more sports on the way. We have many options for league size, payout type and entry fees. Some unique things about Swagger Stadium are that we offer fantasy MMA and fantasy NASCAR leagues. No one else offers both to their players. Most of our leagues include the option of live, in-game substitutions, and we offer leagues that combine two different sports in the same fantasy league. These unique features provide an amazing experience for our many customers. We are legal around the world and in 45 states in the U.S. Fantasy leagues for money are not currently legal in Arizona, Iowa, Louisiana, Montana and Washington state. You must be at least 18 years old to play on our site and at least 19 years old in Alabama and Nebraska. When signing up, customers agree to our Terms of Use and Conditions, which clearly states the state and age requirements. We also have custom age and geolocation verification software. Currently we offer NBA, NCAA CBB, NASCAR, MMA and NHL, with several sports launching within the next 30 days.
G9: How much does it cost to join and what do you get for your money?
TH: There is no cost to signup for our site and we have free and paid fantasy leagues available each day in all of our sports. Customers who sign up with us are given the opportunity to play and compete against other players and win money while having a totally unique experience, one they can not find anywhere else.
G9: Why is your operation legal and why isn't it considered gambling? Is there really any difference between guessing which team will have a good day and win a game, which is gambling, and guessing which players will have good days, which is legal fantasy play?
TH: The Federal government made fantasy sports for money legal by passing the Unlawful Internet Gambling Enforcement Act of 2006. Our fantasy sports leagues are considered games of skill. Our customers have to balance player and team statistics, conditions, game theory and many other factors in order to win and beat their opponent.
G9: How did you get into the fantasy sports business? Can you tell us about your personal background?
TH: I have owned and operated many different businesses across multiple industries in my professional life and have been involved with fantasy sports for about five years. I have such an intense passion and energy for sports and fantasy sports specifically that I made it my mission to provide a unique and unrivaled fantasy sports experience for sports fans. That combined with the unique niche I was witnessing in the daily pay to play sector made me jump in
G9: How are you preparing to compete against the commercially successful DraftKings and FanDuel? Both companies have attracted significant investment monies recently, so are you preparing to do the same?
TH: We have certain advantages and they have certain advantages. We are agile and responsive and can make significant changes and upgrades very quickly. We offer some sports that they do not offer and we will be adding more sports that they do not offer. Our customers can make live, in-game substitutions and can play in multi-sport leagues, which they cannot do anywhere else. We are always open to the idea of discussing potential investment opportunities.
G9: What has been the growth rate of your business in the past year? What is the driving force behind that growth? Has the media coverage fantasy is getting translated into a boost for your own business? And how many paying customers do you have right now?
TH: Swagger Stadium launched last summer and we have seen an amazing and steady increase in customer sign-ups, deposits and leagues played. Our advertising and marketing efforts, new sports and features added, and customer referrals have all contributed to our growing success. Daily fantasy sports as an industry has grown so much in the past 12 months and we have seen some positive effects from that growth and mainstream acceptance.
G9: What is an average fantasy player worth? How much will he or she spend on daily fantasy games in a given year? How does this compare with season-long contests?
TH: An average daily fantasy player will spend $500 to $1,000 or more over the course of a year. This is much higher than a season-long player, due to new leagues being available multiple times per day.
G9: Can you compete with the likes of ESPN and Yahoo should they enter daily fantasy sports, as is rumored?
TH: Bigger companies have certain built-in advantages and vast resources, but we are confident that Swagger Stadium will continue to provide a proprietary and unique fantasy sports experience that our customers cannot get anywhere else. This will drive massive repeat business as well as new business from customer referrals.
G9: Would it make sense for a fantasy company like yours to team up with an online sportsbook partner, such as Bookmaker.eu or Sportsbook.ag out of Costa Rica or one of the European books such as Paddy Power of Ireland or William Hill of the U.K.? Such a partnership would give you a ready-made customer base of sports-betting fanatics, so have any such companies approached you or vice-versa?
TH: We are always open to the idea of discussing potential investment and partnership opportunities, but sports wagering online is not legal in the U.S. Because of that, we would be looking to partner with someone overseas where it is allowed.
G9: Where are you based and why have you chosen that location? And are you considering branching out into other locations?
TH: Our offices are based in Wayzata, just outside Minneapolis, Minnesota. The Twin Cities metropolitan area is one of the best economic locations in the country when considering many different factors. Our fantasy sports leagues are available in 45 U.S. states and across the world.
G9: What do you see as the fantasy highlights of 2014, both the highs and the lows? For example, what players have crushed your customer base and who are the big money-makers so far?
TH: There are many great things that happened in our industry in 2014. I would say some of the best were the staggering, record-setting growth of new customers, entry fees, and leagues played. Also, the mainstream acceptance and visibility was huge after large marketing campaigns this fall from a couple of our competitors. As far as lows, there really were not any. The daily pay to play sector is on fire right now and it has been all positive.
G9: What is the most money anyone has earned playing with you?
TH: No millionaires yet, like you see on TV, but we have many customers who have won tens of thousands of dollars playing in our fantasy leagues.
G9: Do you have many female players? What percentage of your customer base is female? Are there any significant differences in the way female customers play fantasy as compared to male players, as far as strategy, tactics and expectations are concerned?
TH: Yes, we have many female players and a larger percentage than most people would probably assume. Different sports attract different audiences and with every new sport we add we see a huge increase in the diversity of our customer base. We have not seen any difference in strategy or tactics when it comes to differences such as gender.
G9: What is the basic demographic of your paying customer? If it mirrors the demo of the average American sports bettor, it would be white and male with a high level of education and income, although the age for fantasy players would be lower on average than the age for sports bettors. How accurate is that assessment?
TH: Those demographics are close to what we see on average from our players, but that is not all-encompassing. We have a large number of female players, players from different ethnic backgrounds and players with varying levels of income and education. Over 40 million people play fantasy sports in the U.S. alone, so you truly get a pretty wide range of customers.
G9: Where do you expect fantasy in general and your company in particular to be a year from now? Do you expect legal sports wagering to become more widespread in the U.S. in the coming years? If you do, how would that affect fantasy?
TH: We expect daily fantasy sports to continue to grow very rapidly. A year from now, there will be new fantasy sports companies pushing the envelope, exciting new products and features, and the introduction of sports that have never been offered on this platform. Swagger Stadium will continue to aggressively seek out new customers, seek out ways to excite and entertain those customers and provide them with an experience that they will want to tell their friends about. We will be adding five or more new sports this year and will be releasing new exclusive features that will greatly enhance the fantasy sports experience for our customers. The legalities surrounding sports wagering are not clear at this time, so it's hard to give a forecast on that. I think more exposure and mainstream acceptance of sports wagering will help our industry, not hurt it.
G9: What is your cost per player acquisition? How much is a fantasy player worth compared to an online sportsbook bettor? Is there a way to increase the value of your players?
TH: Our customer acquisition cost keeps decreasing over time, as we become more efficient and more popular in our industry. That cost can vary quite a bit, depending on how we are trying to gain new customers. The lifetime value of a customer is pretty similar between the sportsbook and daily fantasy industries. When we add new sports and release new features, our customers enter more leagues and increase the amount of money they're spending on our site.
G9: Online sportsbook operators say it's hard to reel in affiliate partners who are used to making crazy earnings with sportsbook, casino and poker affiliate programs. How does your company look to compete in this area? What are your marketing plans? Is there an off-season or does Major League Baseball actually represent a peak in revenue potential, as opposed to the decline we see with sportsbooks?
TH: We have many affiliates already working with us and are in the process of bringing on a few large affiliate groups. We have not seen any difficulties in attracting affiliates, as we can offer a pretty enticing affiliate program and opportunity. NFL and college football drive huge amounts of traffic, but we have also seen great success in other sports. We will be offering MLB leagues in a few weeks and are very excited for the revenue and profit opportunity that baseball presents.
G9: Do you plan on pushing your software as a white label product to potential partners and operators?
TH: That is always an option and something we are open to discussing. We currently do not have any white label products out on the marketplace. That would be more of a product for overseas as discussed earlier.
G9: Is there anything else you'd like to add that you haven't been asked about?
TH: We would encourage your readers to give us a try and see what they have been missing by playing fantasy sports and sports wagering elsewhere. Swagger Stadium, with its patent-pending products, is committed to providing our customers the ultimate experience in playing fantasy sports. We guarantee it!
By Tom Somach
Gambling911.com Staff Writer
