FanDuel running three days behind paying players

[The Buzz]

The company is three days behind paying out withdrawals for players who have asked to be paid by check and two days behind for players who have asked to be paid using PayPal, company spokeswoman Justine Sacco said.

As if FanDuel and DraftKings weren't already exactly like online gambling sites (while claiming not to be), now one of them is behind on paying out player funds. That's, like, the first rule of being an online gambling site. First, you hold player funds. Next thing you know, you're being arrested for stock "pump and dump" schemes.

Too soon?

http://www.reviewjournal.com/sports/...order-requests

[TheGooner]

As I understand it neither of the major players in the DFS market are cashflow positive. The survive by making continued cash-raising rounds with investors while promoting DFS as sort of sports gambling special case - and a license to print money once they corral the nation into playing regularly.

They are spending so much on advertising, expenses, and player acquisition that it costs them far more each month to acquire the players than they actually make from the average player lifetime - the more they spend - the more players they acquire - the bigger the losses.

It's part of an exponential growth plan, typically associated with online sales and SAAS (software as a service) companies ... It only works out well if the growth continues to be significant AND if the current players continue to spend (and for gambling customers - lose) money on a regular basis.

I just don't "get" why DFS is popular to the degree that has been hyped by the companies offering the games (and I am a big sports fan that loves numbers) the game play itself is actually a bit sucky - and the "skills" component means that Joe Average player is never going to get a big win accidentally.

I suspect that the user count is vastly inflated by multiple entries from individuals (I read some grinder / semi-pro players enter 100's of times?) and that the real value per player is not there to sustain such a high-profile advertising business.

DFS will survive in some form - but probably only for hard-core sports stats junkies.

[EuroMarketer]

They should be subject to the same regulations as bookmakers and poker sites that stipulate that player funds have to be held in a separate account from the operating expenses account of the company.

From Business Insider:

Earlier this month, New York state attorney-general Eric Schneiderman insisted that FanDuel and rival DraftKings be terminated, accusing them of operating gambling companies without a licence.

Class action lawsuits are already being assembled in several states that will seek to reclaim money lost to "illegal" bookmakers.

Google Capital, Time Warner Investments and Turner Sports taking part in this summer’s $275 million (£176 million) round, which brought total investment in the company up to $361 million (£234 million.)

[universal4]

That's just it, they do NOT want the regulators considering them a betting operation, (even though they ARE), since that would pull the plug on them pretty much throughout the US.

Rick
Universal4

[Sherlock]

I promote fd and dk on rev share, so I see the real numbers. Although what gooner said makes sense and I was under impression it must be like that, the actual net profit is present. I hope I will break even the CPA rates somewhere during next NFL season with 35% revshare (ofc if current state will continue). I do not know bookies where I can break CPA sooner than in 2 years, usually it takes much more, especially in the US (for my traffic).