FanDuel co-founder: 'Leaving your job to become an entrepreneur and making that leap in the dark can be very, very difficult'
Nigel Eccles (41) co-founder of online gaming phenomenon FanDuel and one of Northern Ireland's richest men, speaks to Claire McNeilly about how he overcame initial failure and what life was like growing up on a Co Tyrone farm.
Q. You weren't always hugely successful - were you not tempted to give up after your first foray into business ended in disappointment?
A. It was very challenging early on; not a lot went right. It was also very difficult to raise money. I don't ever remember thinking about giving up, though. I always thought in the early years that we would make it through despite the setbacks.
Q. It's quite a gamble giving up all your savings and not taking any salary for 18 months. Presumably there were quite a few challenges when you were trying to get FanDuel up and running?
A. In the first year we were out fundraising and I remember just having real confidence that we'd finally get somebody to invest in us.
Towards the end of 2008, however, there was more worry that we maybe just wouldn't get closed on the financing.
Q. How much did you actually invest?
A. Tens of thousands. Then we went out and raised about $1m in the UK at the end of 2008. In that first round we approached 25 to 30 funds but in later investment rounds we approached up to 90 or 100 people. The first round raised about $1m and the second, in 2011, was $4m.
Q. Some US state regulators have decreed that FanDuel's business constitutes gambling. Are you winning your battle with them?
A. Last October, we really ran into head winds where certain state attorney generals started to go negative on the industry. The interesting thing with that has been that legislators and voters are saying 'this is crazy, fantasy sports has been played for years, it's a mass market consumer activity, it's something I love doing'. We see real momentum on the legislative side where over the last month we've seen Indiana, Virginia and Massachusetts issue laws or regulations that regulate fantasy sports. I feel very confident over two to three-year time frame that we will see that go from three states to over 40 states.
Q. You're FanDuel's chief executive and Lesley is executive vice president, marketing and acquisitions. What's it like working with your wife?
A. It's been great. I think we shared a similar passion to be successful and I also think that it's very hard to explain the challenges of building a business to your partner; having her involved in some ways makes that easier than for us to be doing our own separate things. FanDuel had five co-founders so we had a pretty big team from the start and we've now built up a pretty big executive team.
Q. Lesley credits you for coming up with the original idea for FanDuel. How did it come about?
A. We had a different product called HubDub (an online prediction market for betting on elections and new stories) in early 2009 which wasn't doing that well.
But we had a very good team and we had investment at that point; we just needed to come up with a product.
I felt that fantasy sports was going to be a good market for us, and pushed for us to go in that direction.
Fantasy sports was a very big market in the US but the existing products weren't that great.
We examined different ideas for FanDuel and it was only in October 2009 we felt we'd got it right.
Q. Is it true that, despite its enormous wealth, FanDuel has not technically made a profit yet because of the huge amount your company spends on promotion and advertising?
A. Yes - and that's very typical for high-growth companies. You make a choice between growing really quickly or profitability.
We've always decided that it's more important for us to focus on growth.
Q. Have you taken FanDuel as far as it can go?
A. Not at all. There's something like 230 million sports fans in north America alone, and there's many times that across the world, so we have a product that only touches a couple of percentage of the US market today. We need to continue to make the product better and more exciting and bring it out to more players. Up to now, we've only scratched the surface.
Q. So where is your next target market? Have you any plans to invest in Northern Ireland?
A. We're planning on launching a UK version of FanDuel this summer and that would obviously be marketed to Northern Ireland as well. As we see how the UK goes then we would look to how do we want to invest more heavily here. We're targeting for this coming Premier League season in August. It will be a one-day fantasy sports product.
Q. Tell us about growing up on a dairy farm in Co Tyrone.
A. My memory is that it was a lot of fun being in the countryside. My mother Dorothy's memory, though, was that it was a lot of hard work. I'm the youngest of four boys. I was only five when my father Sam died in his 40s; my mum brought up the four of us - me, Trevor, Alan and Richard - on the farm on her own, which is pretty impressive. I went to Donaghy Primary School and Cookstown High School.
Q. You and Lesley (42) have three children - two boys aged 11 and eight and a three-year-old daughter. How did you meet your wife?
A. We met at St Andrews University in Scotland. Lesley, who is from Forfar, studied modern languages and I studied mathematics. We got together in 1993 and married in 2003 in a place called Fyvie Castle in Aberdeenshire.
Q. How often do you come home to Northern Ireland?
A. Probably about twice a year. I like to get home as much as I can but it's not always possible. It really just depends on school holidays and my own travel schedule. We've been in Edinburgh nearly 10 years. My kids are in school here and very settled. It just means that I have to travel quite a lot.
Q. In a recent interview, your wife she said you have a date night once a week. Do you get out much... and, if so, do you talk about work all the time?
A. That sounds great... we actually did go out last night, to the theatre. But I'm not sure we've been out together any other time this year. I think the date night once a week is more of an aspiration than a reality to be honest. When we go out we do talk about work... and the kids. Typically, however, I tend to sleep - which happened last night.
Q. What's your most outrageous purchase?
A. I'm not really that extravagant. Between focusing on the business and raising my kids I don't tend to have a lot of time outside of that. Our entire focus is wrapped up in building the business and I don't focus on material things.
Q. FanDuel may not be a household name in Northern Ireland or the UK, but in America millions of people know it because they use its website to try and win prize money from a multi-million dollar pot as they put their skills to the test in the fantasy game market. Looking back, it is such a simple idea. Are you surprised no-one really thought of it before you?
A. There were certainly lots of ideas out there about how to make fantasy sports better. I think what we brought was a focus on building a really good product with a focus on simplicity. What we'd discovered in this market was that when people tried to come up with innovation they made it unnecessarily complex and what we wanted to do was come up with a really clear differentiator from the existing products but build it in a way that people could understand very quickly. Thirdly we wanted to harness the massive growth in mobile and so today around 80-90% of our users access our product via mobile device and existing products didn't do that very well.
We felt that if we had a clear differentiator, which was about making the game faster, and we made the product really smooth and easy to understand and then harness we would have a real competitive advantage.
Q. What about the other three co-founders?
A. I went to a networking event in the autumn of 2007 and that's where I met Tom Griffiths, who was working with Rob Jones and Chris Stafford on a technology start-up.
We are good friends - despite the challenges of growing a business.
Q. You and Lesley worked as management consultants for different firms. Why the sudden change in direction? Was it dull?
A. Lesley had been with Capgemini and I had been with McKinsey. I loved working at McKinsey, it's a great firm. Prior to that I had been at a couple of start-ups and I really loved the energy and excitement and I loved the idea of building a product that consumers could feel and the idea of building a business. I'd done a couple of years consulting and I always wanted to go back and be an entrepreneur and so it came to the point where I thought I had to make a decision to go for it or I would always probably regret it.
Q. Are there any other multi-million dollar business ideas in your head?
A. If there were, there wouldn't be time to execute them. We discovered that having a good early idea is very important but the actual idea is really just the beginning. We started off understanding there was a space where we thought we could innovate then it took us nine months to a year to really figure out what the product should look like and then it took us multiple years to work out how to really grow the business and acquire users. I do think there are many markets full of opportunities.
Q. Are you born an entrepreneur or is it something you can become?
A. That's a difficult one to answer. I think your environment really helps you. I think being surrounded by other entrepreneurs helps. When I was at university there wasn't as much entrepreneurial activity in the UK and I never thought about it as a career option leaving uni. In the late '90s it became more of a career option and I got to meet more entrepreneurs.
I also think a lot of the networking and entrepreneurial events make a huge difference because without that the leap into the dark - leaving your job to become an entrepreneur - is just very, very difficult.
There are many more people out there who would love to be entrepreneurs that aren't today.
Q. You're based at Edinburgh's Quarter Mile, but spend lots of time in New York, where the company's US operation is based. Do you see yourself becoming a US citizen eventually?
A. No, the current set up works very well for me. We have a huge presence in the UK in terms of our employee base here. I've got a very good senior team in New York and the plan is for me to continue to split my time between the offices.