Lots of talk and rumors about a possible FanDuel and DraftKings merger surfacing and it’s looking evident and more likely than ever before. I’m not a merger and acquisition specialist but I’m pretty keen on marketing and running a startup and wanted to toss out my thoughts of what all this means and what to expect. So let’s look at what it means for you as a player and for the sites.
For the Sites
The first things the merger will have to decide on is how they will proceed with branding. What company name will they use? Will they create a new one? Who will run it? Etc. These aren’t easy questions and along with these questions, there are several others involving much more granular details that have likely prevented this merger from happening already.
They’ll probably hire some consultants to come in and do some brand trust and consumer surveys to see which brand gives them the best leverage to go from. If they come out equal, it is likely an entirely new brand is created from the group. This decision isn’t easy and it’s this precise conundrum that could force an outside CEO to come in and manage the new company. They’ll need someone that can come in and be impartial and not let the “but this is my baby” take effect.
Whomever the CEO is will need startup experience that has been rubbing elbows with VCs and knows how to play the game very well. One thing we’ve seen is a crazy amount of ads ran in the past which have started to slow down but it was certainly a battle between the two sites of who could spend the most. Investors will want someone that has a proven track record of a slower burn rate on cashflow and can see the long term future instead of spending boat loads of cash.
Spoiler alert, it’s easy to throw tons of money and see results. The key is to see who can get those results at a fraction of the cost. I don’t have a list of potential CEOs that would fit this mold but I haven’t really looked at it. I’m sure there’s a list of folks they’ll have to interview and I would imagine that the current CEOs of both companies will play a big role on the board moving forward if they go this route. I don’t really think either of the current CEOs will remain, that doesn’t seem likely unless this isn’t a merger but an acquisition play by one of the companies.
There will be other things like sports offered, scoring, affiliates, and a whole slew of other stuff that will have to be worked out too. I would guess similar surveys done for which brand to use will provide much insight into decisions for this as well. The sites would likely continue to operate as independent brands for a little while. Mergers don’t happen overnight and to make sure it goes right, I could easily see one here that takes anywhere from 6 to 12 months.
For the Players
We can only hope the above takes place as it puts us in a position to have the widest array of players happy. It will be different for each based on what we like and have grown accustom to but we’ll have to change and adapt or stop playing. Bitching and moaning on social media won’t work unless as a group we have a concentrated effort to make change. I urge those that don’t like the changes to provide solutions with the complaints, otherwise it just comes off as whining and will likely be disregarded.
It’s been my experience that sites will listen a lot more when you take the time to think out a solution vs just complaining about it. In any event, you are likely to see changes no matter which site you play on. Whether it’s from a UI or UX or the sports and scoring system you like to play with. Be prepared for these changes and be ready to adapt and change your play style to accommodate for those changes.
I’ve heard a lot of stories about affiliates being stiffed and not paid timely. One can only hope this merger will strengthen the financial situation for the sites to pay these folks in a more timely manner. You can expect less advertising and even potentially lower big prize tourneys in the near future while the new formed company finds its new balance on what they can offer and sustain long term. They won’t be competing with each other anymore on large prize pools but it will be easy for them to offer larger contests than some of the other DFS sites around right now but it may be much smaller than what you’re seeing right now. That’s okay, it may need to happen for long term sustainability.
Well, that’s my $0.02 on this whole thing. My best guess is it will be announced in the month of November and not fully merged until summer of next year or longer depending on the stipulations of the merger.