Fantasy sports is a huge, thriving industry, grossing more than $4 billion annually, with expected growth to reach around $31 billion per year in player fees in the next five years. Within the combat sports industry, which includes MMA, boxing, kickboxing and Brazilian jiu-jitsu, there are just a handful of players, but only two are really doing solid, stable numbers. The originators, Kountermove, have been at the fantasy grind since 2011, and have more than 30,000 registered, active members. The new kids on the block, to MMA at least, are DraftKings, who started running their MMA games in January 2015.
DraftKings’ numbers are a little more difficult to discern, as they have been around for three years and already had a huge, well-established player base from their other sports offerings, primarily football. The data simply isn’t available for the percentage MMA plays in their totals, since they are only seven weeks in with their UFC games (I say UFC here because at the time of this posting, they only offer UFC games). The point to take note of here is that DraftKings has a plethora of potential customers at its disposal to pitch their MMA games to.
With the two companies basically going head to head against each other, and DraftKings having raised more than $75 million in funding last year, the question on the minds of many fantasy MMA players is, will there be room for both in the relatively small confines of combat sports? The answer might surprise you. While DraftKings has been pouring money into the advertising of their new games, with some kind of sponsorship deal with the UFC already in place and visible on the mat at UFC 183, they still encounter hiccups in their business affairs, as evidenced by a class action lawsuit filed against them last month for false advertising.
Kountermove, while the smaller of the two companies, anticipated the impact of the competition (something they hadn’t experienced before), and have prepared themselves for the long haul. In a recent, e-mail interview with Bloody Elbow, Kountermove co-owner, Aaron Ard discussed the fantasy MMA market and the long term plans for his company. Here’s what he had to say:
Bloody Elbow: Is Kountermove sticking around with this new competition coming in?
Aaron Ard: Absolutely. We are the OGs of modern day fantasy MMA. Why would we stop when fantasy MMA begins a major growth cycle (Forbes)? The fantasy MMA market overall is really just beginning.
Kountermove has revenues, funding, and exclusive partnerships with Tommy Toe Hold, Renato Laranja, Shannon Ihrke, Natasha Wicks, Jade Bryce, The Iron Sheik, and more. We also have a license agreement in place for the scoring data to run our games. Over the past few years, 30,000 MMA fans have registered and we have thousands of active players who love playing in our community.
Check out this industry demographic on fantasy sports HERE to get an idea of who’s playing, how many are playing, how much money is being made, including stats on how they’re playing (mobile/website), the specific games they’re playing and more.
Bloody Elbow: Why do you think the UFC is not working with the #1 company in DFS (daily fantasy sports), FanDuel?
Aaron Ard: First, FanDuel does not yet offer Fantasy MMA games. In multiple publications recently, ODF Report and New York Business Journal, a UFC executive has confirmed that this is a 1 year deal to be exclusive fantasy sports sponsor.
FanDuel is much larger than DraftKings, by a range from 70/30 to 80/20. In fact, DraftKings lost ground to FanDuel in 2014 (ODF Report). FanDuel is reportedly raising $100M+ in funding at a Billion Dollar valuation (ODF Report), and has plans to go public in 2016.
Long term, the UFC could view co-marketing with FanDuel as very valuable because they would be marketing UFC PPVs to FanDuel’s large user base.
FanDuel’s demographic is a great fit for the UFC – young males, active online, avid sports fans, and higher average incomes. One scenario is what happened with THQ vs. EA Sports in video games, where the UFC will eventually partner with FanDuel when they enter the sport as they did with EA for ‘EA Sports UFC’.
Bloody Elbow: Reports say this is an ‘exclusive’ or ‘official’ sponsorship deal, what does that mean?
Aaron Ard: As reported by the New York Business Journal last week, UFC has confirmed that DraftKings is becoming the “official” fantasy sponsor of UFC, similar to the Muscle Pharm sponsorship. Usually in these kind of arrangements, the “official” or exclusivity aspect refers to being the only paid advertiser with the UFC for this category of service but not running of other games. For example, the NBA is an investor in FanDuel, but DraftKings runs NBA fantasy games. DraftKings is the official fantasy sponsor of NHL, but FanDuel has fantasy hockey.
Bloody Elbow: So what is your going forward strategy in this DFS ecosystem’?
Aaron Ard: We are some of the biggest UFC fans on the planet and always will be, and we’ve been watching MMA since the early 90s. We hope that Kountermove has done a small part in helping the sport grow and flourish.
Kountermove is entirely dedicated to DFS for all combat sports – all MMA leagues, Boxing, GLORY Kickboxing, WWE (free games only), and Metamoris Pro Jiu Jitsu. We’re the originator of ‘modern day’ fantasy MMA and the best place for MMA fans to play against other fans. We are part of the MMA community and the sport’s fabric.
DraftKings will always be primarily a fantasy football, basketball and baseball site. We believe strongly that in MMA and combat sports specifically, there is high demand among fans for a dedicated site and community.
Bloody Elbow: Tell me how you see the state of ‘Fantasy MMA’ overall as a market?
Aaron Ard: Fantasy MMA is in the early stages and poised for tremendous growth (ODF Report). Unlike football and baseball (est. 40m fantasy players) (Bloomberg), there was no pre-existing fantasy market in MMA before Kountermove.
This process is experiential – as more players play Fantasy MMA and learn the intricacies of the game, the more it becomes part of the MMA viewing experience. Fantasy football has been doing this for years; it’s become a core part of the fan/entertainment experience and has driven a huge improvement in viewership growth for the NFL (Motley Fool). Seventy percent of fantasy football players watch real NFL games that they otherwise would have skipped (Fantasy4All). Moreover, fans consume 40% more sports content – across all media – once they start playing DFS (USA Today).
Since DraftKings has entered, fantasy MMA interest overall has jumped and we have seen our numbers grow significantly. In January, we saw a huge increase across all of our key business metrics.
Keep in mind the daily fantasy sports industry barely existed two years ago but is projected to grow to $31 billion in player entry fees by 2020 (New York Business Journal). A couple million people play daily fantasy sports right now, but 41 million Americans have played traditional season-long contests. That’s almost 40 million potential new customers (Forbes).
The beautiful thing is Kountermove sits at the crossroads of both these massive trends.
You can follow Kountermove via their Twitter account, @Kountermove
Disclosure: Steph Daniels is a paid brand ambassador for Kountermove, but they are not an advertiser on this site. Any free tournaments they provide us with are their responsibility, as well as the associated payouts of those tournaments.
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