Are FanDuel & DraftKings the Uber & Airbnb of the fantasy sports world?

The comparison at first may appear to make no sense, but please hear me out. The pairs of companies have far more in common than you might at first expect.

New take on old ideas

All four of these companies came into existence in spaces that were around long before their own creation. Fantasy sports? Yahoo!, ESPN, and others have had Fantasy Leagues for decades. Spending a night away from home? Hotels have existed for 100s of years. Want a ride home at the end of a night out? Even before Uber you could have called a cab (though you likely didn’t want to). It isn’t that any of these companies recreated the wheel. Rather they took an idea, took an existing business model, and said: “Wait, why do people do it that way? Wouldn’t it be far better, more enjoyable, more fun if they did it this totally other way?” And so they created this other way. And guess what, their customers love them for it.

No long-term commitment

Part of the beauty of all four of these companies is how their offerings are built around the idea of choice, of options, and perhaps most crucially for Millennials, of instant gratification. Messed up your fantasy draft? No worries, next week, or even tomorrow is an entirely new day. Not sure where you want to live when you move to a new city? You no longer need to decide day one. Shop around neighborhoods and get to know your future potential neighbors by staying in Airbnb. Or not sure what car you want, or if you even need or want a car? Get cheap rides for a while to get where you need to be via Uber. All of these companies are built around constant optionality. You may never have to make a long-term commitment again, though if you don’t your girlfriend will probably dump you.

Deck is stacked for the pros

One of the lesser-known facets of these companies, though it is gaining more attention recently, is who the real winners are. Airbnb has built its entire brand on helping those nice couples keep up with their mortgage payments by renting their spare room. Uber talks about the countless micropreneurs it helps create by allowing people to boost their income in the free time by driving around their car that would otherwise sit idle. And if you have stepped out of your cave at any point in the last 6 months you have seen countless commercials of the average Joe, someone just like you, who won $1 million on one of the daily fantasy sites. And all of this is true, to an extent. What is less discussed, less promoted, less lauded, is where the majority of the winnings/profit goes. For Airbnb, a Skift report found that “10 Airbnb Super-Hosts Rule New York City.” For Uber, sure each driver is keeping a cut of the fares, but who is getting a cut of every fare? Uber, the professional company. And for FanDuel and DraftKings, Bloomberg has found that “the top 10 players combine to win an average of 873 times daily….[t]he remaining field of approximately 20,000 players tracked by Rotogrinders wins just 13 times per day, on average.” Yes, each of these companies holds up a David or two as the model, and that is great for PR, but for all four, Goliath is the real winner.

Regulatory woes

Which brings us to the fourth commonality: all sit squarely in regulators’ sites at this point. The attention stems largely from the oversized success of these companies. As an earlier post pointed out, when you do incredibly well, haters are gonna hate, hate, hate, hate, hate. There is no doubt some truth to the complaint that much of the regulatory actions are little more than government-run witch hunts funded by the vested interests who prefer the status quo (i.e., existing fantasy sites, hotels, and the taxi lobby). That being said, as the regulators begin peeling back layers, the picture many customers and fans of these companies previously had of them is being challenged. There is not necessarily anything inherently wrong with what these companies are doing. After all they are just that, companies, and they need to make money.

Uncertain future

But, and this is the final commonality, all four are also at risk of losing some of their most vocal supporters. If the consumer backlash against the gap between the public image they put forth, and the reality of each company as a whole, becomes too great, how long can they remain the darlings of the tech, startup, and sports worlds?

Andrew McConnell is the CEO of rented.

Originally published at www.linkedin.com.