Wednesday, April 15th, 2009...1:43 am
Wager The World
A few months ago I jotted down some notes on some of my start-up fundamentals for a new web venture. It included the concepts of digital crack, core strengths, social media, SEO, cult community, A&O and revenue steams. If you’re wondering what any of these things mean it’s probably easiest to go back to the post. Note to Wolky – I would love to somehow graphical depict this framework. Any ideas?
Lately, I’ve been toying around with a web business idea. I’ve been thinking about it so much that I need to finally free it from my head. The best way for me to do that is by putting it down on paper. Although I love to think up business ideas, I generally think most ideas are a nickel a dozen. Before I started YBIML, I actually messed around with a blog I created called Digital Epiphanies in which I would share all of my different business ideas. It was before I started at Sportsvite and I needed some stimulus. Check it out – I even made that sweet Einstein graphic on my own. So I have no problem sharing this idea with the world. There’s a good chance I’ll never act on this so if somebody came along and ran with it I would wish them luck!
Without much further ado…
WagerTheWorld.com — allows anyone to wager anything against anybody.
A member of WagerTheWorld would be able to create any kind of bet imaginable. They could create a wager on sports, weather, news, television shows, box office numbers, financial information, election results, extinct animas, lottery numbers, airline arrival times, concert attendance numbers, amount of tweets Shaq will have next Thursday, under/over on days until we live on Mars, probability of Lance Stephenson committing to the Johnnies, etc. As long as it’s provable by public record it’s legit (this may be tricky). The creativity, odds and schemes are up to the members and they will ultimately be judged by the market it creates.
The bet would not become active until another member accepts the wager. A person could also make a counter offer. This betting exchange would allow anyone can create or accept bets with others (think eBay). No longer do you have to con your little brother or best friend into accepting some dumb bet that you somehow thought up. Now you can try and sucker the world!
Let’s see how this fits into my framework…
Digital crack - It’s gambling. This is as close as I’ll come to selling crack unless I get my hands on some fresh cut Peruvian, baking soda, a spoon and a candle. I can only imagine how much time the average gambler would spend on this site.
Core Strengths – I think my skill set be aligned with dictating the feel of the community and the exchange. Although I’m not a huge gambler I’m pretty sure I would have the ability to build this up and then stimulate when needed. While this is by no means a technical breeze, I think the exchange platform is straight forward and it would certainly not need to compete on pure technology if it was developed correctly.
Social Media - You win a bet you brag. Now you can brag to your facebook friends, on twitter and throughout the digital galaxy. when a person creates a bet they could broadcast it out to their network to see who wants to bet against them. Facebook connect integration would be perfect.
SEO - Is there a way to have new bets indexed highly on google search? Sounds difficult. Anybody know if that would be possible? I don’t usually see eBay listing on google.
Cult Community - Um, yes. Imagine losing a bet to some shlub and then trying to beat him to win your money back. Natural rivalries would occur. Top winners could be recognized on the site and have people fight to be the best overall wagerer.
A&O - This kind of exchange is a perfect application of the web. Organizing information and communicating in a way that was impossible before the web.
Revenue - It would be a transactional business based on volume of bets. Like StubHub or eBay, the site would take a vig or commission on every completed bet. As the exchange grew so would revenues.
You should be able to see why I love this idea. It fits very nicely into my framework. Unfortunately, I have three major concerns.
#1 – Can this be legal?
At first glance, it would appear that this would be deemed as gambling and therefore be illegal in the US. In 2006, congress enacted laws against online gambling and Feds have cut down HARD on online gambling website and banned US financial intermediaries (credit card companies) that service those sites. I would hate to live my life hiding out in a Costa Rican ex-pat village. But thanks to Bo Obama the tides are beginning to turn and there is talk that a new law will pass that wil once again legalize gambling in the US. Most of the big time gambling sites are based in the UK including Party Gaming, Bodog and Intrade (prediction market). The laws are much less restrictive but I believe it is technicaly illegal to do business in the US. There are also new start-ups like OneSeason that are digital exchanges that use real currencies. I’m wondering what the official legal definition is for online gambling. I once had this problem when I started college fantasy at CSTV. According to the NCAA (not that they are a good source) a game of chance needed to be free to play and award prizes instead of cash to not be considered gambling. Couldn’t a good lawyer figure out a way to position this so it could be legal (Lawyer friends – send me your thoughts). What happens if there wasn’t real money involved? Would that take away all of the appeal (and revenue) though?
#2 – Scams
The wager exchange would work most efficiently if people were able to self-reconcile their bets (similar to eBay). I’m not sure if this is too much to ask and wonder what percentage of bets would end in dispute (the shades of gray here would be like Easton’s hair – he would also be my #1 member!). My guess is that some kind of reputation platform would be essential. This would allow you to see how many time members dispute their bets. A resolution center would most likely have to accompany the reputation platform. Xbox Live does a good job of keeping people honest — even those who really want to cheat. Also, if you told me that eBay was going to work at first I would have never have believed it.
#3 – Moral Hazards
Is this what I really want to do with my life? Create a gambling eco-system thanks to legal loopholes. Would I have success stories or would this site lead to ruined lives? I don’t see the world as one big gamble. At the core, I’m still an idealistic blogger who likes to write about old chicks who know the meaning of life (Eloise Hawking!). I’m just as afraid, as I am excited, of what this could become if I was successful.
I’m sure there are more potential competitors and comparable sites (besides those mentioned above) that are already doing something similiar. But as I’ve said before, I think you win on execution, not on the idea so not too worried even if there were close competitors already in the market. They can’t be doing that well if I haven’t even heard of them yet! Understanding the current landscape does help you figure out what works and what doesn’t and why.
I’m also going to add moral mission (that sounds a bit latter day) to my framework. Google is renowned for their corporate motto of “don’t be evil”. I want my next venture to follow the motto “making the world better”. One of the things that keeps me going at Sportsvite in rough times is that I truly believe that helping people experience and enjoy sports is a noble goal. It’s a solid foundation for when I have my doubts (which every start-up has). I’m just not sure if thriving off of people’s addiction will allow me to sleep happily at night.
What do you think? I would love to hear your thoughts about the idea, how my framework holds up, and how I presented it in this blog post. I’m curious to see if this leads to any conversations or connections that could cultivate it further down the road to reality.
If you have any business ideas that you want to share hit me up and I’d be happy to post it on the blog. This could include Marc’s perverted hostel, Gallerstein’s real estate site, anything from that meat head Ossola, Schwa’s rentals, Roy’s polish sausage shoppe, Libby’s beer taps, or franchising the Gallinski original Mexican ices factory.