PrizePicks CEO: "There is an immediate need among consumers, vendors, and operators for clarity in daily fantasy sports"

PrizePicks has emerged as a prominent daily fantasy sports operator in North America, boasting substantial growth within the industry. The company achieved a remarkable 500% increase in revenue throughout 2022, with payouts exceeding $500 million since its inception. Currently, it employs a workforce of over 300 individuals, solidifying its position as one of the fastest-growing DFS companies in the nation.

In an exclusive interview with Yogonet, Adam Wexler, Founder and CEO of PrizePicks, delved into a range of subjects, encompassing the company's product, market dynamics, regulatory landscape, and the future prospects of daily fantasy sports in the US.

Can you provide an overview of PrizePicks for our audience who may not be familiar with your platform?

PrizePicks is the most vibrant digital community of sports fans. At the core of our community are player prediction games of skill. We are most well known for our paid fantasy game where you predict if multiple athletes will hit statistical projections. We’re in the midst of our seventh football season and have clearly established ourselves as the #1 paid fantasy sports operator in North America.

When was PrizePicks founded and how has the company evolved since its inception?

I entered the fantasy sports industry in 2014. I was a season-long fantasy league consumer of multiple leagues like many U.S. sports fans. Every NFL season would come around, and no one wanted to be responsible for collecting money. As an entrepreneur for more than 15 years, that sounded like a clear problem worth a business solution.

We built that prototype, but quickly determined it was a very seasonal need so we asked ourselves - is there anything else a digital treasurer for fantasy leagues could find helpful? That led us to another problem facing fantasy league players: the season-long format can drag on, so how do we keep it interesting week-to-week?

Our second product, SidePrize, was also started that fall, and we set out to allow fantasy league mates to put their money where their mouths were. That product won a number of awards from the Fantasy Sports & Gaming Association including ‘Rookie of the Year’ and was selected for the LA Dodgers Accelerator program, but after DraftKings and FanDuel inundated the airwaves with advertisements in fall 2015, the Attorney Generals (AGs) came after the industry.

Following the legacy operators' massive lobbying efforts, I watched approximately 20 states proceed to legalize fantasy sports and the subsequent evolution of new ways to play our favorite contests. We were not the first to hone in on a single-player fantasy format, but after starting PrizePicks in fall 2017, we have been able to separate ourselves in the category over the last five years. 

What unique features or offerings does PrizePicks bring to the gaming and fantasy sports sector that differentiate it from competitors?

My favorite part of the traditional fantasy sports experience is the camaraderie. With that in mind, we wanted to bring a communal feel to our fantasy game.

First and foremost, we needed to nail what we call the PrizePicks Member Experience. At the core of that is our product, which we wanted to be a fast, simple, and fun form of fantasy sports. If we were going to create a best-in-class experience, we recognized complimenting the product with real-time support and expeditious elements was an opportunity to enhance the experience for our members.

One of my favorite parts of the experience we’ve created is our innovation around our Reboot Policy. With our game, you’re making predictions on how players will perform so it’s unfair when they go down early to a game-ending injury. While fantasy and betting operators pick & choose their refunds, we have blanket policies to consistently protect our members, and we hope it’s clear we have their back more than any operator out there.

We have seen regulators in states such as Florida, New York and Michigan target fantasy sports as of late, citing concerns about the potential overlap those games have with sports betting. Based on these developments, what challenges and opportunities do you anticipate for the sector in the near future?

Today’s fantasy sports market is a far cry from the early days of DFS in 2014. Product innovation has surpassed what are now antiquated views on what fantasy is and isn’t – views primarily pushed by large sportsbook casinos.

There is an immediate need among consumers, vendors, and operators for clarity in DFS. That’s why our team and fellow market companions are committed to working with policymakers and regulators on ensuring DFS is not limited to the outdated products offered by the industry’s two largest behemoths.

With sports betting rapidly expanding in the US, how does DFS’ skill-based proposition set it apart from the gaming experience offered by the gambling industry? What can the fantasy sports vertical do to compete against this sector?

To tackle the first question, because of the ways the laws read from a fantasy contest requirement standpoint, we’re pretty limited in what we can offer compared to sports betting operators. It just happens to be that player prediction is the preferred method of the millennial demographics because we grew up with fantasy sports.

PrizePicks started with a season-long fantasy league consumer premise: I’m spending all this time researching which QB to start – do I believe said QB will do as well as the season-long fantasy league platform projects? Our game is the perfect complement to the existing fantasy league experience, and we’ve steered our experience over time to be the ultimate complement to the live sports viewing experience.

Most gambling operators could care less if you turn on the game – the target audience for the majority is the sports bettor who is seeking the best-perceived value. We’re an entertainment provider focused on those who want to make their viewing experience more exciting.

As the largest DFS operator in North America, how do you see the future of daily fantasy sports evolving?

There was a lack of innovation following the AG scrutiny across the country in the middle of the last decade. I don’t believe that fantasy sports enthusiasts recognize it enough, but the aggressive tactics of DraftKings and FanDuel brought the entire industry to the brink of existence.

Personally, I’m just glad we’re part of a wave of innovation that is pulling sports fans back to sports they lost touch with and/or new sports altogether. I’m happy to see other companies finding their niche in the market – there are a lot of sports fans to be served with fan engagement platforms across the country.

With PrizePicks, we’ve identified a wildly popular and rapidly growing product for the modern state-centric sports fan. We look forward to working with stakeholders across all corners of the industry in further defining the DFS landscape and ensuring the proper consumer protections and responsible gaming guardrails are in place.  

Which trends do you see gaining momentum, in terms of technologies, customer preferences, etc.?

There’s no doubt the millennial demographic who grew up with social media & fantasy sports is more drawn to player predictions than the age brackets who came before. To the point of social media, we see a big opportunity to combine the desire to play games with friends.

In our case, our roadmap involves a number of innovative pursuits regarding friends placing player predictions together. The premise is simple: would you rather talk smack with your friends or high-five your friends? We believe there are just as many or more who would prefer to do the latter.

Could you provide us an overview of the most recent developments, notable partnerships, and any exciting expansion plans in the pipeline for PrizePicks?

We recently announced a strategic partnership with U.S. Integrity, a leading sports data and technology firm. As part of the partnership, we will be utilizing ProhiBet, an innovative product offered via a partnership between U.S. Integrity and Odds on Compliance. This partnership underlines our dedication to integrity and transparency within the daily fantasy sports industry. By harnessing industry-leading technology, we’re able to strengthen our own integrity monitoring capabilities and enrich our customer experience.

We also have partnerships across a handful of major sports teams and leagues and have a couple in the pipeline that we’re excited to announce soon enough.

You recently attended G2E Las Vegas. What were your main takeaways from this event?

I was pleasantly surprised to learn that many relevant industry stakeholders are aware of what the legacy DFS operators are doing behind the scenes to encourage scrutiny around DFS pick’em. That said, I do think we need to make sure it’s well understood beyond those circles.

When pressed on the topic, it was interesting to hear the CEOs of Draftkings and FanDuel express the need for clarity within this breakout category. Just like their most recent comments suggest, we all want to work with legislators and regulators to clarify fantasy sports and ensure sports fans can confidently play the skill-based games they love.

Above all, I remain excited for the future of DFS and what we’re building at PrizePicks. I’m also really encouraged by the many fans we have in the industry who are rooting for our success.