Dream11 – Episode 1

Hey there!

Hope you learned something from our last article on Udaan’s business model and its strategies.

Dream11 – Episode 1

Before we start, remember Mr. Goyal, he has a son, and like every Gen Z kid, his life revolves around his smartphone. Apart from the usual Netflix and Instagram, he is also an ardent cricket fan. Recently, he heard from one of his friends about Dream11 and fantasy sports. He is wondering what it is?

Why should you know about Dream11?

Because once Bill Gates said that –

It’s fine to celebrate success, but it is more important to heed the lessons of failure.

So, let’s look at some of the obstacles in the journey of Dream11.

Dream 11 started its operations in 2008, but how many of you knew about Dream11 before 2012? – data says only a few thousand!

After its formation, they couldn’t raise funding for the next seven years and got rejected by 150+ investors. Also, their business model didn’t work for them very well in the beginning. They had to pivot their business model multiple times before finally deciding on the freemium model.

Now before you feel stuck and wonder what we are talking about, Relax!

We’ll decode each and every point.

Welcome to Stadium

Dream11 is a fantasy sports platform. You can go on the Dream11 application and choose your 11 team members (therefore the name Dream11) from the list of real team players who are playing live on a particular day, as per your skill, judgment, and knowledge. If the selected team members perform well in the real match, you score points and win money, or else, you lose.

But Money + Sports = Gambling, right?

Thriving in Chaos

After the launch of their product, Dream11 was still fighting the battle whether their product is legally viable or not in India.

As per Indian laws, a game of chance is illegal, and a game of skill is legal. It is essential to understand whether the fantasy sport is a ‘game of chance’ or a ‘game of skill’ to determine its legality. In a game of chance, the outcome is determined by some random things like playing cards, dice, or roulette wheels. But the game of skill depends on the data and mathematical calculations to determine the outcome and hence considered legal in India.

As per the founder of Dream 11, Fantasy sports is like the stock market of cricket. Based on past performance and future expected value, you choose your team. It’s much more than just hunches, and the game is deemed legal by the Supreme court of India.

Stadium – The Constant Spectator

Harsh Jain, the founder of Dream 11, was a big sports fan. During his studies in the US, he developed an interest in these fantasy sports, which were very popular in the Western world.

He returned to India in late 2007, and that was when everyone talked about the inaugural season of IPL. It was astonishing for him to see that there is nothing like fantasy cricket in India.

Therefore, he came with the idea of a product, Dream11, in 2008. With all the enthusiasm, he tried to replicate the US Fantasy sports model in India, only to fail.

He failed badly due to multiple reasons.

The Opening Innings

The company initiated its journey with the Free-to-Play and a season-long fantasy sports game layered by the ad-driven model. The users were not charged to join the game, and the revenue was generated from advertisements. Also, the users won the prices only at the end of the season, unlike per match right now. The model failed as ad rates in India were excruciatingly low, which hit their cash flows badly. But the company was still experimenting with new things. They came up with sports news, statistics, content, online video games along with fantasy sports.

Nail and then scale

In 2012, the realization that they diverted the focus on many areas hit them hard. Hence, the co-founders decided to nail the fantasy sports and only then scale to other categories. The company pivoted to a new model altogether – from season-long to per match, from ad-driven to commission-based model – The freemium model.

All the curious souls, you don’t have to wait longer. 😀😀

We’ll be back with the next episode soon explaining the freemium model and much more.

Until then stay tuned!

Writer: Komal Kumari, Nikita Aggarwal  

You can write to us at decodingsuccessfulstartups@gmail.com.