Prior to launching their person-to-person betting site and online community, Vince Monical and Josh Hannah worked at the management consulting firm Bain & Co. As their friendship grew, it became obvious that they also shared a love of betting. The only problem was figuring out how to connect their love of betting with the ideal business plan. Then inspiration struck.
In June 2000 their dream was realized through the launching of Flutter.com, a London-based betting site that promised to take the bookie out of betting while offering a fun experience to the users.
While the early days may have been scary, it wasn't long before the two found success. Since then, the company has been able to attract a top-notch management team and some big name investors through two highly successful rounds of financing.
A few weeks ago IGN caught up with Vince Monical
IGN: What was the first step for Flutter's creation?
Vince Monical: It all started with Super Bowl betting. We (Vince and his partner, Josh Hannah) were betting a lot. At the same time we were having this betting relationship, we started to travel around. We started betting each other via e-mail and we were also both working in the Internet industry trying to figure out what the perfect business model would be. Finally one day, it was sort of just like a light bulb went off: "Ohmigod, we could turn this sort of person-to-person betting we've been doing into an Internet business."
Because now you've got the ability to link up people all around the world, something you
could never do before, something that bookies have done for years but acted as the middleman. We don't know anything about being a bookie, but what we do know is that people like to bet and they like to bet each other. We started to really think about it, and it made more and more sense, because there are two big reasons why you would want to bet person-to-person rather than a bookie.
First, it's better value and the second is, it's more fun. Now, when you bet person-to-person you're not paying a bookie tax or commission that you would pay going to a bookmaker.
IGN: What is your target market? Can you describe your typical customer?
VM: It's a pretty big list, I would say. If you were to look at our horseracing category, you'll find a lot of the traditional bettors. What you do find is that some of these come online to do a big bet or come back to pay bettors off, but then they'll take a flutter on the Grand National today or some other horserace. So, you do see quite a bit of cross over, as well. But primarily on the horseracing you'll see the traditional bettors.
It's a good ecosystem worked out there, as well, because some of the traditional bettors will offer up more odds and then you have some of the lighter punters or people who don't traditionally punt who might come in to take those odds. If you look in the other categories, you'll see more traditional or more light bettors or people that bet previously, there's quite a mix.
There's actually more light punters or non-punters, I guess, in terms of numbers, but in terms of overall volume it's probably fairly equal.
IGN: Would you be willing to share some figures from Flutter, such as the number of players or the amount of money wagered on it?
VM: The community is growing. Flutter is growing. It's been growing at about 30 percent clip per month, so pretty solid growth figures. It's pretty astronomical.
IGN: Who did your software?
VM: We had an outside firm that we hired to do some of the original stuff, but we developed our own software ourselves.
IGN: Since launching last June Flutter has managed to form some good relationships, such as the deals you signed with MSN or Lastminute.com.
VM: We're doing a lot of exciting stuff and we're getting a fantastic business development group here. People like what we're doing out there in the industry, people like MSN look around and they're definitely a bit wary of the gaming industry. They look at us and say, "That's something that's different, that's fun and exciting--a unique concept that I can offer to my users that will help differentiate MSN." They see that, they see the potential of it and the power of it.
For Flutter, continuing to be on the critical edge of product innovation over time, that's definitely critical. That's one of the things that differentiates us from a lot of portals and sports sites. We're not about hardcore gambling, maximizing our revenues at the expense of our punters. We're building a community of people in a trusted, safe environment.
IGN: What do you think makes Flutter different from competing person-to-person betting sites like Betfair or Play121?
VM: I think person-to-person makes a lot of sense as a business model, so I think you're going to see a lot of people coming in and trying us. I think we're recognized as one of the leaders in this space and that's why we're able to secure the big deals. I think there's going to be a lot of people trying their hand at it, it's a big enough industry to support many players. The competition is good for the punters too.
If you look at it, we're sort of focused on our community and building a community that grows over time. We serve our community and serve them well by listening to them and offering them what they want. We're pretty comfortable that we'll continue to grow and be a dominant player.
What keeps us ahead of the rest of the pack I think is, most importantly, our team. If you look at the quality of both our management team and the marketing professionals we have here. Lots of industry experience.
If you look outside our core team and look at our partners, people like MSN and Lastminute that we're partnering with, as well as the investors we've been able to attract--people with an amazing amount of experience in the Internet field. Having Benchmark, a venture capital firm, as one of our investors, that's fantastic. Just sitting on our board they offer a lot of perspective on the Internet industry and where it's going.
Not too many investors can get you a two-hour one-on-one interview with Pierre Omidyar, the founder of eBay. But, Benchmark has. So Josh and I sat down with Pierre for two hours, and say, "You operate this giant person-to-person community, talk to us about what worked for you and what hasn't worked for you." Probably no one in the world understands how it works better than he does.
IGN: From where are your investors?
VM: Actually, they're mostly European. Benchmark is the one purely American investor that we have, and they came in on our second round.
IGN: So are you worried that the U.S. government might be watching for your arrival in the States?
VM: No, I would be if we were serving the U.S. market, which is a pretty big deterrent. During the NCAA football season there was a game between University of Illinois and Cal-Berkeley. Josh went to Cal and I went to U of I. We had the bet up on our site and it's just so ironic that our friends back in the States would absolutely have loved to bet on this, couldn't bet against each other.
If we launched this (Flutter.com) in the United States, we'd be 10 times the size we are today.
IGN: Have you been watching the prohibition efforts as they occur in the United States?
VM: Well, we stay very close to it. It doesn't appear to us any time soon that it's going to change. The hard part, I think, is the lobbying effort. There isn't enough money behind Internet gambling interests, and there's so much money against it.
IGN: What do you see for the future of betting?
VM: If you think about it, you've got to give people a reason to bet. It's very difficult to bring people in, and there are a lot of reasons for them not to bet. You've got to provide them with a very trusted operator, and you've got to provide them with an incredibly entertaining experience. Some players (operators) are moving in that direction and a lot of them aren't. There's a lot of stuff that's just fundamentally not entertaining, you've got to give them some reason for going online to do it versus doing
it offline.
I think the concept of leveraging trust in this space is a powerful concept from Flutter's perspective. That's one of the things we guard very closely and monitor very closely for the Flutter brand.