Ship or Die at Accelerate 2025: User Acquisition

Nigel Eccles, the entrepreneurial force behind FanDuel and BetHog, reveals game-changing strategies for user acquisition in both Web2 and Web3 landscapes. His journey from struggling to acquire two users a day to building a multi-billion dollar empire offers invaluable lessons for crypto startups.

Summary

Nigel Eccles, co-founder of FanDuel and current founder of BetHog, shared his extensive experience in user acquisition strategies spanning both Web2 and Web3 environments. The discussion covered his journey with FanDuel from its humble beginnings to becoming a multi-billion dollar company, and how those lessons apply to his current venture in the crypto space with BetHog.

Eccles emphasized the importance of finding product-market fit before focusing on user acquisition at scale. He highlighted the evolution of acquisition strategies as a company grows, from manual outreach to sophisticated, data-driven marketing campaigns. The talk also explored the unique opportunities and challenges presented by Web3, particularly in terms of user incentivization and token economics.

A key takeaway was the critical role of trust in the crypto space. Eccles revealed how BetHog is differentiating itself in the crowded crypto casino market by prioritizing transparency and putting a face to the company. He also stressed the importance of perfecting the product before leveraging crypto-specific tools like token launches for growth.

Key Points:

FanDuel's Growth Journey

FanDuel's growth story is nothing short of remarkable. Starting in 2009 with a goal of acquiring just two new users per day, the company struggled initially, often falling short of even this modest target. However, a pivotal product change coinciding with the start of the football season in September of that year marked the beginning of a dramatic turnaround.

By 2015, six years after its launch, FanDuel had achieved an impressive growth rate of 5x year-on-year for six consecutive years. At this point, the company boasted several hundred thousand monthly active users and was generating about $150 million in annual revenue. Fast forward to the present day, and FanDuel has solidified its position as the number one player in the US market, with several million monthly users and projected revenue of $7.5 billion for the current year.

Evolution of User Acquisition Strategies

Eccles detailed the evolution of user acquisition strategies as FanDuel grew. In the very early stages, pre-product market fit, the focus was simply on acquiring any user at all, using methods that didn't scale such as cold DMing potential users. This phase was crucial not just for user acquisition, but for gathering valuable feedback to improve the product.

As the company began to acquire users more consistently, the focus shifted to developing repeatable acquisition channels. This meant moving away from manual outreach and towards paid acquisition strategies where the cost of acquiring users could be measured against their lifetime value. Eccles highlighted the importance of tracking metrics such as Customer Acquisition Cost (CAC) and payback period, emphasizing that not all users are equally valuable.

Web3 and Crypto-Specific Strategies

When discussing his current venture, BetHog, Eccles emphasized that many fundamental principles of user acquisition remain the same in Web3 as they were in Web2. The key is still to build a product that people love before focusing on growth hacks or token incentives.

However, he did highlight some unique opportunities in the crypto space, particularly around user incentivization through token economics. Eccles cautioned against rushing into token launches before achieving product-market fit, likening tokens to "rocket fuel" that should only be used when the product is truly ready for rapid scaling.

Facts + Figures

• FanDuel started in June 2009 with a goal of acquiring 2 new users per day
• By 2015, FanDuel had grown 5x year-on-year for 6 consecutive years
• In 2015, FanDuel had several hundred thousand monthly active users and $150 million in revenue
• Currently, FanDuel has several million monthly users
• FanDuel is projected to generate $7.5 billion in revenue this year
• BetHog is competing in a market with about 2,000 other crypto casinos
• Eccles estimates that only 1 out of 2,000 crypto casinos has publicly known founders
• BetHog is planning a future token launch and airdrop

Top quotes

1. "If it wasn't for him, I don't know if we'd been successful. We dramatically changed that product."
2. "Viral never worked, completely never worked. And typically paid products do not grow virally."
3. "CAC and payback are like the two benefits."
4. "Crypto is a graveyard for companies that have launched a VyPMF, have driven incentivization, and then the users have gone."
5. "I think of token as rocket fuel. But you don't ride rocket fuel to, like, something you've built in your backyard that's, like, fallen apart."
6. "We're going to probably be, like, many months, if not a year, making sure it's ready for the rocket fuel."
7. "After the token is, like, you know, that's the star, that's the start line."
8. "We are very careful that when we're incentivizing somebody to do something, that that's value or creative to us and to the token."

Questions Answered

What was FanDuel's initial user acquisition goal when it launched?

When FanDuel first launched in June 2009, their initial user acquisition goal was extremely modest. They aimed to acquire just two new users per day. Eccles noted that even this small target was often difficult to achieve in the early days, with many days resulting in zero or only one new user. This highlights the challenging nature of user acquisition for startups in their earliest stages.

How did FanDuel's user acquisition strategy evolve over time?

FanDuel's user acquisition strategy evolved significantly as the company grew. In the very early stages, they focused on manual outreach methods like cold DMing potential users. As they began to acquire users more consistently, they shifted towards developing repeatable acquisition channels, particularly paid advertising. Over time, they became highly sophisticated in their approach, tracking metrics like Customer Acquisition Cost (CAC) and payback period, and conducting regular A/B tests to optimize their funnel.

What does Nigel Eccles see as the key difference between Web2 and Web3 user acquisition?

According to Eccles, the fundamental principles of user acquisition remain largely the same between Web2 and Web3. In both cases, the focus should be on building a product that people love before scaling up acquisition efforts. However, he notes that Web3 offers unique opportunities for user incentivization through token economics. Despite this, Eccles cautions against relying too heavily on token incentives before achieving product-market fit.

How is BetHog differentiating itself in the crowded crypto casino market?

BetHog is differentiating itself in the crowded crypto casino market primarily through transparency and trust. Unlike the vast majority of crypto casinos which operate anonymously, BetHog has publicly known founders. Eccles himself is directly associated with the platform, with his Twitter account linked on the site. This approach aims to build trust with users who might be hesitant to deposit large sums of money with anonymous operators.

When does Nigel Eccles believe is the right time to launch a token for a Web3 project?

Eccles believes that launching a token should only be done after a project has achieved strong product-market fit. He likens tokens to "rocket fuel" that should only be used when the product is truly ready for rapid scaling. For BetHog, despite having plans for a future token launch and airdrop, Eccles indicates that they're likely to wait many months or even a year to ensure they're fully prepared before taking this step.