Ross Fruin, the founder of GridRival, joins the show to talk about his unique product that is bringing fantasy sports & sports betting to the auto racing world.
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Ryan Knuppel:
Hey, what’s going on everybody? Ryan Knuppel here, Knup Sports Show, episode 143. Thank you so much for tuning in through all 143 episodes. I cannot believe we are getting towards 150, that’s crazy. I hope you’re doing well today, I hope everything is well in your world.
Ryan Knuppel:
As always, we have another special guest that we will get to here, in just a bit. Really excited for this conversation today. A unique product that I think you guys will enjoy, especially if you’re racing fans, you’ll definitely enjoy this. We’ll get into that in a second.
Ryan Knuppel:
But first, I wanted to encourage anyone watching live, anyone that’s a part of this, if you want to ask questions of the guest, of myself, of anyone, feel free. Put it in the comments on whatever you’re watching it on. Facebook, YouTube, whatever else we’re on, Twitch. We’re all over the place. Wherever you find a place to put a comment, put it on, it’ll come up here. We’ll pop it up and we’ll ask the questions as they come in. So thanks again, and let’s jump right in.
Ryan Knuppel:
We, today, have Ross Fruin, who’s the founder of GridRival. Let’s get Ross on here. Ross, how are you today?
Ross Fruin:
Good morning, man. How are you doing? Thanks for having me today.
Ryan Knuppel:
Absolutely. I’m doing well here. It’s not so sunny in Orlando, Florida, today’s a little rainy, but I’m doing well. How are you, there in Portland, Oregon?
Ross Fruin:
Very wet as well. It’s rain season over here. But yeah, good. Exciting times, lots going on and excited to share anything you want to talk about today.
Ryan Knuppel:
Awesome. I’m excited to dive in as well, and learn a little bit about what you’ve got going on. But first, let’s learn about you. Let’s learn a little bit about your past and how you got to where you are today.
Ryan Knuppel:
What made you get to where you are? Just give us a little background of yourself.
Ross Fruin:
Yeah. Yeah, good question. I’ve always been entrepreneurial, was pushed in that direction by my father in my early 20s. I’ve been working for myself in one way, shape or form. Started my first business when I was 28, which was a media buying agency that I grew for about six or seven years. Along that journey, this whole fantasy sports craze and sports betting phenomenon started to transform and saw a really huge opportunity in the motorsports sector.
Ross Fruin:
Started a product totally on the side, which never intended to be a business at this form of scale. It eventually turned into that, which I’m sure we’ll talk about today. But yeah, have just always been a passionate motorsports fan, passionate entrepreneur and those two things happened to collide about three years back, which got me to the start of GridRival.
Ryan Knuppel:
That’s awesome. It’s funny how sometimes some of the best products, businesses, whatever, are kind of accidents. They kind of just happen as you start diving into your passion, or into whatever problem you’re trying to solve. It sounds like that may be where GridRival came from.
Ryan Knuppel:
Let’s talk GridRival. What is GridRival? Tell us a little bit about it, specifically what’s the purpose of it.
Ross Fruin:
Yeah. I say that GridRival is a sports betting startup, and as most sports betting startups, we don’t actually have betting on our platform yet. Because, as you probably know, there’s a tremendous amount of barriers, and compliance hurdles and stuff that you have to go through before you can get there. But, that’s ultimately our goal.
Ross Fruin:
How we are building towards that, we started as a season long fantasy game for motorsports specifically. We have two sports on our platform right now, which are Formula 1 and MotoGP. Like I said, it started as an accident. I go to the Formula 1 race every year in Texas, and we rent an RV and we live on the track for four or five days. The tipping point for me starting this project was in 2016, we were at the race, it was the Thursday evening before the event. I was inside our RV and I could hear one of my friends outside, he was screaming.
Ross Fruin:
I went outside and I was like, “Hey, what’s going on?” It turns out, he was watching a football game and he was yelling at his phone because he was losing in his fantasy league. I just remembered that being the point where I was like, “God, I wish something existed for the sports that I love that would drive that level of engagement.” We didn’t find anything compelling at the time. Again, totally as a side project, built a really basic, season long, league based game. It was desktop, web only, barely even worked on a phone. We launched it in 2017 and signed up about 22,000 people in a week.
Ryan Knuppel:
Jeez! Wow.
Ross Fruin:
Yeah. That was the aha moment for me, when I really started-
Ryan Knuppel:
Yeah, proof of concept, right? Check.
Ross Fruin:
Yeah, exactly. For obvious reasons, I started doing a lot more industry research. This was a year before PASPA was repealed. So it was actually that dark era, where the [inaudible 00:05:19] and DraftKings of the world were really fighting for their survival. It was when they were having to go and prove, at a state by state level, that daily fantasy sports was legal.
Ross Fruin:
The opportunity was maybe not as huge as it was a year later, when PASPA was repealed. It was about that time I had the opportunity to sell the company I was running, which opened the door to go pursue this full-time. That happened in early 2019, went full-time. We raised some money to get this MVP out and had our first major launch this last March, with the start of the seasons of both the sports I mentioned.
Ross Fruin:
Really looking forward to the opportunity to fill what we think is a pretty huge gap with a very, very large niche audience. Motorsports, in the United States, excitingly it’s growing quicker than I think it probably ever has in the last 15 or 20 years, since I’ve been a motorsports fan. But even then, historically, racing in the United States is like soccer was here 40 years ago. I think it’s still an emerging sport, relative to the rest of the world. If you go to the United Kingdom and other parts of Europe, and Brazil, MotoGP, and Formula 1 and sports car racing just have huge following. When you combine the audiences of these sports, there’s over a billion people every year that interact with them.
Ross Fruin:
We didn’t really see anybody focusing on this audience in a unique and authentic way, in the fantasy or sports betting arena. We really thought it was a huge opportunity to go pursue them, again in an authentic way, that was unique to motorsports, that was only motorsports specific. That journey started, like I said, full-time in 2019. We just announced on Monday, our first major funding round. We raised $3 million, really to get through a lot of the compliance hurdles that we need to. The plan is to have our first real money games live early next season, for players in select states of the United States and most of the UK.
Ryan Knuppel:
Wow. Well, congrats on the early success and congrats on the fundraising. That’s always a big hurdle to cross and should catapult you to the next level. You just led me into my next question and it was going to be around the real money piece of it. Everybody wants to know, “Oh, how can I win money playing fantasy sports, sports betting,” whatever it is.
Ryan Knuppel:
Tell us a little bit about how that’s going to work. How the prizes, and the entries and all that is set up with GridRival.
Ross Fruin:
Yeah. I’ll tell you what the first games will look like. And then, obviously as we grow, and go through continued fundraising and build the business, we’re going to continue to iterate and add more opportunities for different types of games and stuff.
Ross Fruin:
Essentially, what we’re doing this first time around is very traditional, call it salary capped fantasy structured games, where you’re joining in mini leagues or head-to-head competitions. You start with $100 million in fantasy budget, and with that budget you pick five drivers in an event, and then one constructor or team, depending on how the individual racing series is structured. And then, we assign points to real life competition in a number of different ways. Some are intuitive, race finish position, qualifying position. Some are algorithms that we created on our own to track different things that are nuanced to motorsports specifically. And then, essentially you’re competing on a race to race basis.
Ross Fruin:
So there’s two models, you have a league or you’re playing across the entire season. And then, the major part that we’re going to be adding early next season is daily fantasy, so where you’re competing, really, with the intention of winning money versus the camaraderie piece of it, and the community piece of it that a league drives. Competing for money. And then from there, we have a lot of ambitions to add different types of games, pick them type games. Single event statistic, or single athlete statistic, over unders and stuff like that.
Ross Fruin:
And then, the ultimate goal, which is further down the road, is more of a fixed odds sports book type product in some of the select geographies that we plan to enter into.
Ryan Knuppel:
That amazing. That’s really cool. I love how it’s very focused on what you love. Most of these fantasy platforms or sports betting, sports books and operators, they’re across everything.
Ross Fruin:
Yeah, for sure.
Ryan Knuppel:
I love that you guys are just doing one thing really, really well and you’re really serving that audience, which as you said, is growing and the sport is growing as well. There’s a huge race this weekend, I believe. You can probably talk a little more about that race yourself.
Ryan Knuppel:
On a typical big race like that, what type of interest is there across the United States and across the world? Is it truly exploding like we hear?
Ross Fruin:
Yeah. It’s exploding in the US. Like I said, assuming we’re talking about Formula 1 which was the race last weekend …
Ryan Knuppel:
Yes.
Ross Fruin:
Formula 1 is the biggest motorsport in the world, it’s the pinnacle of racing when it comes to technology, and drivers, and money and everything. Tremendous audience. And you are correct, Formula 1 has been trying to penetrate the US market for a very long time, 20, 30 years and really has not just got the formula exact until the last three or four years.
Ross Fruin:
If you’ve been following at all, it was Formula 1, controlling interest was acquired by a company that was based out of the United States called Liberty Media. I think they’ve done an incredible job at really turning a sport around and penetrating the US audience. Primarily through a documentary on Netflix called Drive To Survive, that’s driven a ton of engagement and interest around the sport.
Ross Fruin:
But yeah, the race in Austin last week was reportedly the largest race audience in Formula 1 history. There was some 400,000 attendees across the three day event.
Ryan Knuppel:
Really? Wow.
Ross Fruin:
Yeah. A lot of people in the United States, when they think about motorsports, they typically think about NASCAR. If they ever think about motorsports, they typically think about NASCAR. Maybe the Indy 500 and increasingly, Formula 1, which is really exciting. But, a lot of people don’t really understand the width and depth of this audience globally. F1 specifically, their races generate the same amount of viewership as the Superbowl, every single one of them. There’s 20 to 22 a year. Most people don’t realize the scope of it.
Ross Fruin:
Those viewers are spread across the world, versus with the Superbowl, the majority of them are in the United States.
Ryan Knuppel:
Sure.
Ross Fruin:
But, it does have a tremendous audience and it’s really just the tip of a very large motorsports iceberg. There’s sports car racing, in the United States we have Indy Car and NASCAR. Outside the United States, there’s Le Mans, there’s Australian Super Cars and World Rally. It is a unique audience.
Ross Fruin:
Going back to what you were saying, I think looking at the sports betting space specifically, I think that’s one of the big areas where you see a lot of money being invested is in the niche focus. There are startups right now that are focused specifically on mixed martial arts, or the nuances of the different sports. I think that’s going to be a big trend that we see over the next five to 10 years as the sports betting space progresses, versus these massive, sport agnostic platforms where, if you look at the gamification from hockey, to football, to cricket, to NASCAR, it’s the same thing. There’s not a lot of uniqueness to it.
Ross Fruin:
I think there’s just a huge opportunity to build a lot of value in the market, from building unique games that are really community and content driven. And really, that have high entertainment value, too. I think that’s one of the big trends that I’m seeing, is focusing on a type of game or a method gaming where, even if you remove the money from it, it’s still fun and it’s still an enjoyable experience.
Ross Fruin:
That’s really what we’re working on because we believe that the next generation of sports betters are really the enthusiasts. They’re the people that will put money on an event, but it’s less because they want to win money and more because they want to heighten their experience and have fun with their friends, and all those sorts of things. We’ve tried to combine all that into a product that’s motorsports specific.
Ryan Knuppel:
I love it. You’re doing a great job. I’m putting up GridRival next to this, so anybody watching, they can see a little bit on the website, it has some screenshots. It certainly looks like you have everything in order and you are just rocking and rolling.
Ryan Knuppel:
But, Ross, we all know, as entrepreneurs, as business owners, there’s always challenges. I’m sure you went through so many challenges that you can’t even count them.
Ross Fruin:
Yeah.
Ryan Knuppel:
But, I’m going to ask you more of a business-y type question because that’s what I love most is the business of all of this. What is one of the challenges maybe that stands out, as you went through this journey, you went through the journey of creating it and you got to where you are today, what’s one challenge that you really maybe didn’t see or just one of the bigger ones that you had to overcome?
Ross Fruin:
Yeah. I think of those in two buckets and I’ll answer this really maybe specific to this industry, because we’re here talking about sports, and betting and stuff like that. There’s obviously tremendous challenges in any business with hiring good people, and raising money is its own thing.
Ross Fruin:
But, I think really specific to this industry is just the compliance and regulatory barriers that have to be crossed. I did a tremendous amount of research on this before I ever started this business, because you’ve got to know what you’re getting into. But even then, at every turn we take, in the United States specifically, this is a really nascent industry. It has been three years since PASPA was repealed, but as we know, the way that states create laws is not exactly as fast as startups operate. It’s usually quite a bit slower.
Ross Fruin:
Just getting a bank account, and getting a payment processor and getting the ability to put consumer funds into a product is really quite difficult in this industry. And, it’s a great thing once you’re through it because it’s a built in barrier of entry for other businesses. But, I just think the requirements there have always, at every turn … We’ve gotten used to the fact that, “Oh yeah, there’s more than we thought there would be,” and that’s just part of it. Luckily, there’s more and more startups, and or investors have seen a lot of these challenges in other startups, so we know how to navigate them.
Ross Fruin:
But, if you’re starting an eCommerce site and you’re just selling shoes, you get set up with Stripe, and PayPal and Venmo, and you can do that all within a couple hours. You can get a site up, and you can take payments and you can set up a bank account. In this space, it’s six months of work, and obviously a lot of money that goes with all those compliance and anti money laundering policies, and things that you have to build internally. That’s probably the biggest one that’s specific to the space.
Ryan Knuppel:
Yeah. Just to comfort you a little, you’re not the first one to have that exact same answer on this show, so that seems to be definitely one of the biggest challenges for startups in the sports betting, DFS, any of that space. Just dealing with the regulations, and the state-by-state intricacies and everything that’s going on across the United States. Why do they make it so dang complicated?
Ross Fruin:
Yeah, I know.
Ryan Knuppel:
Come on.
Ross Fruin:
The good news is with every problem, there’s going to be startups that seek to solve it.
Ryan Knuppel:
True.
Ross Fruin:
I think there’s a really big picks and shovels side of this industry. There’s a lot of startups in the B2B that are working on supporting the infrastructure behind operators like us.
Ross Fruin:
I talked to a company last week called Compliable, it’s a really interesting startup that’s really all looking towards making the compliance side of this a lot easier for startups.
Ryan Knuppel:
Nice.
Ross Fruin:
Not even startups, but enterprise size operators, to be able to manage all the compliance stuff that’s happening in the space.
Ross Fruin:
I think, over time, we’re going to see it get simpler.
Ryan Knuppel:
Yeah.
Ross Fruin:
A lot of entities in the banking and payment space consider it gambling, so I don’t think we’re probably ever going to get away from it being regulated in a way. A lot of that stuff is good, it’s good for the consumer from a protections standpoint and security standpoint. I think there are things that are properly there.
Ryan Knuppel:
Yeah.
Ross Fruin:
But, it doesn’t mean they’re difficult.
Ross Fruin:
And you are correct, one of the challenges that the US has, versus a place like the United Kingdom, which is a very betting friendly environment, they’ve been doing it for a long time, it’s not really taboo there, they have an information set up, from a compliance perspective.
Ryan Knuppel:
Sure.
Ross Fruin:
And, it’s done at a federal level.
Ryan Knuppel:
Yeah.
Ross Fruin:
So when you have a license in the UK, you can offer a product to the entire UK, versus here, it’s done at a state-by-state level. Which again, it’s the best thing for us as Americans to have that state-by-state system, it does a lot to protect us and create differences from a state-by-state level. But in a business like this, when you have to operate by a different set of laws in one state than another state, it creates a lot of work. I think that’s one of the big challenges that any operator has to solve, as they enter the industry.
Ryan Knuppel:
Absolutely.
Ross Fruin:
I think it’s also, like I said, going to be something that we see a lot of investment going into solving those problems, more on the B2B side of things.
Ryan Knuppel:
Sure, sure.
Ryan Knuppel:
Ross Fruin, the founder at GridRival. Ross, I don’t want to keep you too long, I told you around 20 minutes so I don’t want to keep you too much longer. But, I do have maybe another question or two for you.
Ross Fruin:
Sure.
Ryan Knuppel:
I can tell you’re a really bright entrepreneur, a really bright business owner.
Ross Fruin:
Well, thank you.
Ryan Knuppel:
Yeah, I can just tell. I like to ask this question sometimes. Not very often, but sometimes.
Ryan Knuppel:
What’s one piece of advice, now I’m not talking challenges, but maybe one piece of advice you’d have for up-and-coming entrepreneurs who are looking to get in? Obviously, they’re not looking to get into the auto racing sports betting space, maybe, but the igaming, sports betting world. Maybe they have an idea or they have something that they’re trying to get off the ground. There’s a lot of people looking to do something in this space right now. What’s one piece of advice you’d have, if you were starting over or if you were talking to yourself right when you were starting now? What would be just big, general piece of advice you’d have for them?
Ross Fruin:
Yeah. I think I can give my sports betting DFS advice, and then maybe more a general one.
Ross Fruin:
I think on the gaming side, I think the advice I’d have is really have a come to Jesus with yourself and seek input from others in the industry about the uniqueness of either the product or the technology. Because one of the things I’ve seen a lot is startups that, they maybe think there’s this one specific type of game that will make this more fun, and a lot of those people just immediately get copied. I think the product has to be unique enough to where you can either capture an unpenetrated audience, which is really our play. I look at this as much less a sports betting play and much more an audience play. We’re going after an audience, our theory around it is that we can capture them better than anyone else.
Ross Fruin:
I think just really have an honest conversation with yourself about is the product unique. If maybe the gamification isn’t unique, maybe the tech that runs it is somehow unique and protectable.
Ross Fruin:
And then more on the business side, I think one of the challenges when you’re building something that is really unique up front is it’s not always obvious. When things aren’t obvious, it makes it difficult to go to the market and raise money. To be in the space, it’s very difficult to enter the space without raising money because of all the things we talked about, the hurdles you have to get through.
Ryan Knuppel:
Yeah.
Ross Fruin:
I think one of the challenges that I found early on, three years ago, before motorsports was exploding in the United States, I had moments where it was really difficult, I had to question myself, “Gosh, is this really what I think it’s going to be?” There was moments where I had to just really assess and look at the data, and go back and forth, and really question whether or not it was the right move to continue. Those were difficult times.
Ryan Knuppel:
Yeah.
Ross Fruin:
Because fundraising is hard enough in itself, because if you’re really good a fundraising, one out of 20 people is going to tell you yes and they’re going to invest. The best of us. That comes with 19 out of 20 people explaining to you why your business is not going to work, and why it’s not big enough, and whatever, and why your team’s not good enough. That can be challenging. You just have to have a lot of confidence in your market and what you’re doing, and your own abilities, and just stick with it and believe it.
Ross Fruin:
One of my favorite quotes, I think it’s, “Before something is genius, it’s always crazy.”
Ryan Knuppel:
Yeah, that’s very true.
Ross Fruin:
I think the best, largest ideas in the world, at the earliest stages, when people heard them they were probably like, “God, are you serious?”
Ross Fruin:
I remember in 2011, I was sharing an office with another company. One of the engineers from that company was obsessed with Bitcoin. Back then, I just remember hearing it and being, “This is the dumbest thing ever, this is not going to go anywhere.” That was a painful lesson.
Ryan Knuppel:
Yeah. Yeah.
Ross Fruin:
I pay a lot more attention to trends now, literally because that happened.
Ross Fruin:
That’s tough. It’s a tough thing that entrepreneurs have to go through as they’re scaling up businesses, is the rejection that comes with building something truly unique that’s a new market and a new audience that people haven’t experienced before.
Ryan Knuppel:
Yeah. Great advice, great advice. Really appreciate that, Ross.
Ryan Knuppel:
All right, any last words, anything maybe about GridRival? Where you’re headed, anything coming up that’s really exciting that you want everybody to check out? How can they get to start playing GridRival, where can they find it? Give me all that here, to end the show.
Ross Fruin:
Yeah. So best place is in iOS or Android store, you can download us. You can visit gridrival.com. You get links to those places as well. We do have a full desktop web application.
Ross Fruin:
Other than that, I think the only thing I would say is find a race coming up for Formula 1 or MotoGP, or NASCAR, or some way to try and get involved. Watch Drive To Survive on Netflix. Lots of really exciting stuff happening in the racing space and we’re really passionate and interested to see where it goes.
Ryan Knuppel:
Passionate, interested and it sounds like positioned well as well, to take advantage and really be in the driver’s seat, no pun intended, for this big boom of auto racing.
Ryan Knuppel:
Congrats, Ross. Really appreciate you joining me today.
Ross Fruin:
My pleasure.
Ryan Knuppel:
I appreciate everybody tuning in as well. Good luck to you and if you ever need anything from me, be sure to reach back out.
Ross Fruin:
I appreciate it, thanks so much.
Ryan Knuppel:
All right, take care, Ross.
Ryan Knuppel:
That was Ross Fruin, the founder at GridRival. He is doing some great things. Gridrival.com, check them out in the app store, Google, Apple, wherever else you can find it, gridrival.com. We’ll actually put all the comments out in the show notes for this show afterwards, so you don’t have to write them down. Go and just click them, we’ll have those up later.
Ryan Knuppel:
Appreciate everybody tuning in. Stay safe, have a good one. Until next time, I’m Ryan Knuppel, Knup Sports Show. Take care. Bye bye.
Relevant Ross Fruin Links
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Learn more about GridRival here.
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You can connect with Ross on LinkedIn.
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