Dream 11, India's magnificently famous Fantasy game was started in 2008 by Harsh Jain and Bhavith Seth. Both being football enthusiasts themselves wanted to increase the involvement of sports lovers in their favorite sport. Dream 11 has crossed 60 million users in 2019 and is expecting to reach 100 million users by next year. Adding onto Dream 11's business and revenue investors like Tencent and Stead view Capital, Think Investments, Multiples Equity, and Kalaari Capital have invested largely to the Dream 11 fantasy game. Being the first Indian company to make it to Unicorn club, Dream 11 now values over $ 1 Billion.
The application Dream 11 is a major hit among Indians since it binds the country together for their love for Cricket. India’s love for cricket is uncanny and unstoppable. When countless things tear the country apart, cricket will always make us stick together and Dream 11 currently, has a major role in doing so.
The Dream Behind The Dream 11
Harsh Jain and Bhavith Sheth, the founders of Dream 11 were just 22-year-olds when the journey of Dream 11 in India began. Both being huge fans of the fantasy leagues of English football wanted to do something similar for IPL (Indian Premier League) Dream11 started off as a personal project for the duo with the plan to help Indians be move involved in their beloved sport more than ever.
Harsh was an engineering student at the University of Pennsylvania and he was also working as a marketing manager at Jai Crop, an infrastructure and real estate company promoted by his father Anand Jain. Red Digital, a digital and social media agency was also dabbled by the duo in 2010.
The company sold Gozoop for roughly Rs7 crore in 2013. Dream 11 was initially an ad-based model which had a long season format. sadly, it didn't find many takers. The company eventually decided to stop this model in 2012 and shifted its focus to allow users to invest money in their favorite teams. Allowing users to pick a team before the match begins and also allows the users to choose which players will perform the best. Earning a rank at the end of the game depends upon how the user performs throughout the actual math and how many points has the user accumulated.
The users are charged with a service fee if they choose to play a money game wherein the money is pooled and the user earns ranks. having just 300,000 users in January 2015, the company has now reached 1.3 million users by the end of the year. Witnessing Dream 11's trajectory, its user count took a leap from 5.7 million users at the end of 2016, then to 17 million users in 2017, and more than 8 crore + users currently.
The business model of Dream11
Dream 11 is a sports startup for sports buffs to showcase their love, passion and especially their knowledge regarding the sport. Enabling the users to create their own team using the available players in a certain match, the users create the best possible team according to their wish.
Once the teams are created, the users can compete with other users online through the Dream 11 app. Points are awarded to each player during the ongoing match depending upon their performance in the real match. In the end, the user with the maximum points wins the biggest chunk of the designated prize money. One has to pay a fixed amount of money to compete with other users on the app. Only a definite number of players are allowed to participate. The entry fee for a certain league is the same for all the users.
The users don't always win the prize money, however, the person with the highest points is awarded the prize money and the prize money is also decreased depending upon the rank. The total amount put in by all the users is usually higher than than the total prize money which is distributed among the winners, the remaining amount is collected by Dream 11. The entry fees are usually around Rs75 with the total prize pool of Rs3 Lakh with respect to 5333 entries. The number of winners ranges to 2600. The prize money is then distributed among 2400 users from the 5333 entries.
Revenue Model Of Dream 11
Dream 11 spends a lot of money on technology up-gradation, platform maintenance, human capital and of course advertising. With this, they also offer cash prizes and rewards to the top scorers. Diving deeper into the app one can opt for free as well as cash contests. The free contests consist of users to just enter and play. The top scorers in free contests do not any cash rewards. The cash contests aren't free to enter.
The users are supposed to pay an entry fee to create their desired fantasy game team thus entering the contest. The winners of the cash contests are eligible to claim the cash rewards. The money is usually transferred into the winner's bank account. In order to make money, Dream 11 makes sure the sum total collected before the game as 'entry fees' is greater than the sum of all the cash rewards paid by them to the top-scoring participants during the match.
When a user selects his/her team they are supposed to pay Rs.73 to enter the Dream11 cash contest. The total prize money amounts to Rs.3 lakhs and this price amount will be distributed to the winners. the total slots available for a match are 5,333.The total revenue to be collected by Dream11 will be the amount that calculates when you multiply the total slots by the entry fee which is Rs.5333 x 73 = Rs.3,89,309.
Thus Rs.3,00,000 being the total price money payable under the contest the remaining, Rs.89,309 represents Dream11’s revenue. Dream 11 the fantasy cricket app collects its revenue by charging the users an entry fee when they join a contest, Ultimately, its a 20-80% game wherein 20% is deducted as commission and the remaining 80% is distributed among the winners of the contest.