Fanatics CEO Michael Rubin has promised that the company will pay out $1bn to customers as the company looks to compete with its market rivals.
The company has grown quickly in recent years, proving to be the fastest growing in the industry and it is hoping to capitalise on this with innovative products, including FanCash.
Rubin spoke on acquiring new users and maintaining how the company is pledging to give $1bn to customers with its promotional product, FanCash, which can be used on other bets, merchandise and other rewards.
“Our customer acquisition cost is definitely less than a DraftKings or FanDuel, every time someone makes a bet with us, we give them FanCash.
“That’s $1bn we’re going to give out next year. They can use it for merchandise, for tickets, to make more bets, to buy collectibles. Win or lose, you get the FanCash.”
“When we think about what gaming can be in our five-year plan, we have gaming being 40% of our profits.”
Speaking of the future, Rubin was bullish over the company’s goals as it looks to compete with both DraftKings and FanDuel.
Lose money to make money
In Fanatics’ case, it understands that the company must lose money to eventually move forward, investing heavily in its product as the fastest growing sports betting operator in the US.
Rubin said: “If you look at DraftKings, two years ago they were losing a half one billion or $!bn. This year, they’re going to make $900m.
“These companies have very quickly swung from tough businesses to very good businesses.
“We’ve spent $1.5bn since we launched. We’ll lose about $300m this year, we’ll lose about $150m next year and then we’ll make up several hundred million dollars – we feel great about that.”
“We’re now the third largest player in the sports market in the U.S. We had 4% a year ago and zero the year before, we’re definitely the fastest.”
