Technical flair: FanDuel’s move into sports betting

It has been a busy few years for sportstech entertainment company FanDuel, which last May combined with Paddy Power Betfair’s (PPB) US business to create FanDuel Group. The deal created one of the industry’s largest online gambling business in the US, with a customer base of some eight million players across DFS, horseracing betting, online casino and exchange betting.

But FanDuel Group didn’t rest on its laurels and went on to go live with a retail book at Meadowlands Racetrack in July, followed by the launch of its sportsbook product in New Jersey in September. The technical advantages of the combined firm include FanDuel’s mobile focus and agile technology team as well as its strong product, reputation and brand image while PPB offers the technological expertise on the sports betting side.

As part of the merger, former Betfair US CTO Tim Morrow joined the combined operator to become CTO of FanDuel Group. Since joining FanDuel Group, Morrow has been responsible for overseeing the sportsbook product launch in New Jersey, the retail technology build-out and the use of two public cloud systems across both companies.

Morrow talks to EGR Technology about FanDuel Group’s in-house technical expertise, the advantages of using public cloud and the challenge of creating a seamless customer experience in the current regulatory climate.

EGR Technology: What have been your priorities since joining FanDuel as CTO?

Tim Morrow (TM): The FanDuel merger occurred right when we were putting the finishing touches on our sportsbook product offering for New Jersey and we were getting ready to launch in time for the NFL season.

One of the top priorities has been to ensure we have been able to grow and scale our sportsbook offering, not just for the New Jersey market and meeting the huge demand there but looking ahead to other opportunities that are coming up.

Relating to that another priority has been to build out a retail technology capability to keep pace with the demand at the Meadowlands facility and create a blueprint for deploying retail in future states. We’ve also been preparing to enter new online markets for sports betting and trying to understand the various needs of the regulators to make sure our products are going to be ready for those.

We’re not just focused on sportsbook, so we continue to develop and grow our horseracing, DFS and casino products. Aside from product delivery and product engineering, we have a global technology organisation across multiple continents with a very diverse set of skills.

Our priority is to look for a way to align the teams across the different regions and solve the challenges with a mix of skills.

FanDuel’s New York City office

EGR Technology: What skills/knowledge did you bring over with you from Betfair US?

TM: We’ve been operating real-money horseracing wagering in regulated US markets and a casino product in New Jersey for many years so that experience certainly helped navigate the waters of regulated sports wagering in the US. Those products operate at significant scale which helped to prepare for the growth of the sportsbook even in a single regulated market such as New Jersey. Prior to coming to Betfair US, I spent five years at Paddy Power Betfair overseeing the Betfair sportsbook technology, and that provided a good foundation for the US market entry.

EGR Technology: How has the technology strategy for FanDuel changed since the FanDuel PPB US merger?

TM: Prior to the merger we have gone from two organisations that were focused individually on horseracing and DFS to a combined organisation that has now launched a sportsbook product. We have a strong engineering organisation now across a number of locations that we want to leverage for all our product offerings, so we are looking for opportunities to deliver more seamless customer experiences across those different products.

This will result in our teams building more and more of our own technology for sportsbook and applying the same product engineering team capability for horseracing and DFS to the sportsbook sector as well.

EGR Technology: Are you investing in research and development (R&D) to continue to improve your products?

TM: These days R&D is integral to all product development and the two are indistinguishable. From an R&D perspective, all new product enhancements that we build, whether it is a small feature, project or an entirely new product line, starts with a hypothesis that we want to prove or disprove through experimentation.

So, whether that is user research using prototypes through to fully developed proofs of concepts or AB testing product enhancements that is the approach we take to all product development. The common theme there is that it’s always a risk where we want to develop something our hypothesis doesn’t hold true, so it’s about figuring out the answers as quickly and as cheaply as possible.

EGR Technology: How do your tech needs differ in the DFS sector compared to the rest of the egaming industry?

TM: If you look at DFS compared to the other industries we’ve had more freedom within the various regulations in how we build and deploy our products. Just looking at DFS, it’s a fully proprietary design that’s built end-to-end by our engineering teams.

It’s been developed over the years using various technologies and deployed in a public cloud environment. If I look at the horseracing product, we spent many years developing that to also use modern technology and working in a public cloud environment. Then as you look at sports betting and casino, there are more regulations there that define how and where we can deploy our products so it’s a little more difficult trying to balance the regulations versus using all the latest development practices we have.

EGR Technology: How do you make sure your betting apps stand out from your competitors?

TM: Across all our products we have a great customer research and design team that’s always looking to differentiate our products from the competitors. As you look at specific products, for example sports betting, we have a lot of experience in-house building sports betting products with talent we have been able to get from Europe.

We are also able to leverage the global scale of Paddy Power Betfair to offer a great breadth and depth of markets. We’ve been in these businesses for a very long time. We have people with a lot of domain knowledge, whether that’s in horseracing or in casino or the other products. So that gives us an innate understanding of what the customers want and that leads to more innovative product capabilities.

EGR Technology: Are you using cloud technology to host your platforms?

TM: Yes, we do leverage public cloud technology to host our horseracing and DFS products. Given the merger of the companies, we’re now in the position where we operate those two different products with two different public cloud providers at scale.

We have built up a significant body of expertise with the Google Cloud and Amazon Web Services. We also operate our data warehouse platforms in the cloud. We are always looking for opportunities to utilise Software-as-a-Service solutions rather than things we have to deploy ourselves. One benefit of the cloud is the horizontal scaling capabilities.

Your product has to be engineered in a way that allows you to make use of that. Both for DFS and from a horseracing perspective, where we see great peaks and troughs in terms of customer demand, using the public cloud allows our platform to scale up and down to meet that demand.

Another benefit is the lower operational cost, which allows us to move much more quickly. We no longer have to maintain our own infrastructure. We don’t have to do operating system patching, upgrades or maintain physical equipment like firewalls.

EGR Technology: Is FanDuel experimenting with innovative technologies such as augmented reality, virtual reality, voice technology, etc?

TM: FanDuel has a history of innovation in making sports betting, real-money gaming and horseracing fun, safe and accessible. We’re always keeping an eye on how we can advance that mission through technology.

We developed an in-play app in partnership with the NBA which provides a unique experience for customers to compete while watching live games, and we used some innovative technology there to sync up the TV signal with the live data that is being served inside the app.

EGR Technology: Do you recruit your technical staff from within the online gambling space or from outside the industry?

TM: If I look at the US, historically most of our technical staff have come from outside the industry given the limited reach of the sector. In Europe it has been more of a mix. Certainly, as part of the Paddy Power Betfair group we have access to engineers with a lot of great technical expertise as well as industry experience. I wouldn’t say industry experience is a prerequisite to be successful at FanDuel.

From a technology perspective, we have similar challenges to many other high-scale ecommerce businesses and other industries that operate in highly regulated markets. Experience there is always valuable but it doesn’t have to be specific to sports betting or real-money gaming experience.

EGR Technology: What are the biggest technical challenges facing FanDuel at the moment?

TM: As a combined entity we have a great portfolio of products that each were developed to meet the challenges of their own markets and regulations. Part of our strategy is to provide more seamless customer experience between those various products as well as expanding into newly regulated markets.

One big technical challenge is to figure out how to do that effectively to balance the customer experience versus the regulations and all the technical requirements that go along with that. Over the years we’ve invested in and learned a lot about developing technologies that allow us to deliver at pace and operate at scale in those environments.

We have taken those learnings and applied them to the regulated markets, whether it’s by managing physical infrastructure or figuring out how to deploy software at pace while balancing the needs of the regulators.

EGR Technology: What is your technology roadmap for 2019?

TM: There is a big sports betting focus of course and we want to be ready to launch retail and online as each new state regulates. We want to be able to provide more seamless customer experiences across our DFS, sportsbook, casino and racing products.

We also want to keep innovating within the sportsbook space itself and continuously improve our product there. We can’t forget the other product categories that we will of course continue to invest in, our DFS and TVG horseracing products, to develop new features for those existing customers.