Lost millions of dollars at age 24 It was a defining moment for entrepreneurs Hersh Jain and Babbitt Sheth.
“It was pretty bad,” Jane said. “There’s no other way to put it.”
“Every founder truly believes that when they start something, it will explode and change the world…and our company fell apart and burned.”
But the Indian duo also know a lot about bouncing back from failure.
More than a decade old, their company, Dream Sports, is now worth $8 billion and has 160 million users.
Dream Sports is an Indian sports tech company that owns Dream11, India’s largest fantasy gaming platform.
Everyone who is a fan of sports has an opinion on how the sport should be played, which players should be selected, and whether the strategy for the game was right or wrong.
Babbit Sheth
Dream Sports co-founder and COO
Fantasy sports are online games that allow participants to create virtual teams of proxies that track real-life sports players. Game participants then earn points and win prizes based on the actual performance of these players.
“Every sports fan has an opinion on how the sport should be played, which players to pick, and whether the strategy in the game was right or wrong.
“What fantasy sports are trying to do is organize that opinion into a more structured format.”
Jane added: “In your movie, you keep comparing fantasy sports to popcorn. Popcorn is there because it makes the movie better. Fantasy sports do that to sports. , makes the sporting event 100 times more interesting.”
The pair, now 36, spoke to CNBC Make It about how they became pioneers in India’s billion-dollar industry and how they turned their fantasies into reality.
how it started
Jain’s first exposure to fantasy sports came in 2001 while studying in the UK, specifically the Fantasy Premier League.
“I found out about something called fantasy football…and all my friends back home were into it too. Bhavit It was one of them,” he said.
When Jain returned home in 2007, given the popularity of cricket in India, he began looking for a fancy cricket platform, but the search was fruitless.
He decided to take matters into his own hands.
“I told my friends that we have to solve this problem…India has a billion cricket fans, but they don’t have fantasy cricket.”
Harsh Jain and Bhavit Sheth started their startup Dream11 when they were 22, but it “crashed and burned out” quickly. Mr Jain said:
dream sports
Jain partnered with childhood friend Sheth to launch Dream11 in 2008. It offered free-to-play fantasy cricket and relied on advertising for revenue.
Players could also create one fantasy team for the entire season.
They received “millions of dollars” from family and friends as starting capital, but after two years found themselves short on cash.
“The reason there was no advertising revenue was because…the product[s] Fantasy sports weren’t understood in India. They needed to be educated,” says Sheth, who is also the company’s chief operating officer.
“At that point, we were wondering what to do now. We knew fantasy sports as a model would work. We needed a format that worked in India. It was.”
From ad-driven to “freemium”
Jain and Sheth decided to start a digital agency called Red Digital.
“It was a difficult time. We didn’t have the resources to help us through the crisis,” says Sheth.
According to him, Red Digital eventually became one of the largest digital agencies in India, which helped Dream11 grow.
In the process, the co-founders transformed the fantasy game platform from an ad-dependent one to a so-called “Freemium” model.
“In terms of monetization, what we did was have a built-in contest where you had to pay to enter… and build a prize pool,” Sheth explained.
Most entrepreneurs forget that fundraising cannot be taken for granted.
harsh jainism
Co-founder and CEO of Dream Sports
“If you win, you get a cash prize. Essentially, every time someone enters a contest, we keep a percentage of the entry amount paid by the user.”
According to Dream Sports, the average ticket price is 40 rupees ($0.5), and top players can win up to nearly $250,000.
Also, changing Dream11 from a season-by-season format to a game-by-game format has reduced user commitment levels from months to a day, Sheth said.
Jain adds:
Dream Sports claims that only 20% of their users are playing with their money, with safeguards in place to ensure responsible play. “We have some contests with 10 million people competing. We always try to maintain our appeal by making sure at least 50% of the people get their money back,” said Harsh, co-founder and CEO. Jain says.
Null Photo | Null Photo | Getty Images
The strategy worked.
In 2013, when Dream11’s retention rate started to rise, Jain and Sheth decided to sell their digital agency, Red Digital, so they could focus on building Dream11 instead.
“If you had to focus on one business, which one would you choose? We both enjoyed building products. I didn’t really like it,” says Sheth.
“It was a necessity.”
The digital agency sold for $800,000, and the two turned it back into their fantasy sports platform.
“Money is not free”
Over the next seven years, Jain and Sheth began to see the fruits of their labor.
In 2019, the Mumbai-based startup finally joined the ranks of India’s Unicorn Club. It is the first sports tech company to do so.
Dream Sports is currently one of the few profitable unicorns in India, according to news tracking site Entrackr. In fact, Jain and his Sheth say the company is doing well in 2020 and beyond.
“Most entrepreneurs forget that fundraising should never be taken for granted. Every funding round we’ve ever had, we always projected a 12- to 18-month runway and then We had to turn to breakeven and profitability,” said Jain.
Unfortunately, this is a very hard lesson to learn and one that many founders need to learn — money doesn’t come for free.
harsh jainism
Co-founder and CEO of Dream Sports
“If your unit economics don’t lead to that, then either you’re valuing it wrong, you’re raising the wrong amount, or your business fundamentals are wrong.”
Jain added that he learned this from the company’s heavy losses early on.
“Unfortunately, that’s a very hard lesson to learn, and one that many founders have to learn. The money isn’t free.”
This sharp vision fueled the growth of Dream Sports. Dream Sports’ investors include Chinese tech giant Tencent and American hedge funds Tiger Global and D1 Capital.
In 2021, Dream Sports raised $840 million and valued the company at $8 billion. In the same year, the company said he made $332 million in revenue and his more than $40 million in net income.
Overseas expansion?
Jain and Sheth have come a long way.
Looking back, they said it was “sheer tenacity” that got them through the twists and turns.
“It saw the problem…and was very passionate about it myself. I think that’s all most founders need,” Jain says.
Sheth said:
Dream11 currently offers a total of 11 fantasy sports including cricket, basketball, football and baseball.
What is the secret to Dream Sports success? “It saw the problem…and was very passionate about it myself. I think that’s all most founders need,” said Harsh Jain (left). rice field.
dream sports
