Football Fortune: Daniel MacDonald
The young entrepreneur talks us through his journey from only having a Dragons' Den viewer's investor knowledge to securing over £80,000 in funding
Name: Daniel MacDonald
Company name: Football Fortune LTD
Date launched: 21/12/2014
Tell us what your business does:
Football Fortune is a global football prediction app. It allows you to make predictions on 16 of the biggest leagues and tournaments across the world. You can select a win, a draw, the score and the players who you think will score. Each element rewards you with a different amount of points for predicting correctly.
The points you win then rank you in a number of worldwide leader boards including overall, your home country and the team you support. You can also create a personal leader boards to play with against friends.
Where did the idea for your business come from?
I was on the train home from work one day and there was Champions League game on that night. I went to put a bet on but realised I had no money in the bank as payday wasn't for another couple of days. I only really wanted to place the bet so that I could be involved with the game as I never win anyways! So I then had a thought, why don’t I create an app that allows people to be involved in football the same way as betting does, but base it around a point system instead of money.
How did you know there was a market for it?
As a result of personal experience and being surrounded by people who love sport, I realised that a huge amount of fans do not agree with gambling, prefer not to, or are under the age of 18 and therefore cannot gamble. Yet everyone who is passionate about football has some idea or an opinion on who will win, what the score will be and who will score, and sport is competitive to watch so I thought this offered a way for people to be competitively involved without having to gamble any money.
What were you doing before starting up?
I was working at Lloyds of London as an assistant underwriter for the liability and yacht accounts with company called Munich RE. I was working there for just over two years when I had the idea for the app and a year later I left to launch the business.
Have you always wanted to run your own business?
I didn't think about it much before but after reading a book on entrepreneurship and business creation that changed, then it was just finding the right business idea.
How did you raise the money?
At first I thought I would be able to get a loan but after the cost of development was finalised, we knew that wouldn't work. So I went on Google and searched app investors, expanded my knowledge on the different sectors and types of investors, and started to pitch my idea to right people. After about six months of rejection, a group of investors agreed to meet us, they liked the idea and agreed to fund the project.
Describe your business model and how you make money:
We cover six leagues across the world, five European and one in the US and to predict on a tournament you must have a certain number of gold tokens. Gold tokens can be won by predicting the correct score and the winning team in the game and you get more gold tokens if you pick the correct scorers too. If you don’t have enough gold tokens you have to buy them from the store, the most common tournament takes 10 gold tokens to unlock (which costs £0.79p).
You can also ‘add booster’ to your score, which will multiply it by two, five or 10. These can be used in leagues where we offer prizes and can be used against friends to win.
What challenges have you faced and how have you overcome them?
I initially hoped that I could get a loan to build the app but after discussing the concept with app developers I found out that it would cost between £80,000 and £100,000 to create. One app developer advised me to take my ideas to investors. At this point I didn’t know anything about investors except for what I had seen on Dragons' Den.
Most of these companies required a business plan and a figures sheet, which I have completed before. So I went on Google, downloaded a business plan template and began to write one – which took a lot more work than I had anticipated. I had to do extensive financial and market research, covering everything from the sporting demographic; number of people who have smartphones; and the market split between iOS and Android. This was all so I could demonstrate figures that were based on a formula.
We then took the plan to investors, finally getting one to show interest. The investor and his business partner both liked the concept and agreed to invest, but only £20,000. This wasn't enough to fund a completed version of the app so I had to continue my search, getting additional interest from one other investment group but they want to be sole investors and so I had to reject their offer initially. However my original investor then began to discuss equity and show signs of not committing.
We couldn’t come up with a final agreement and so I contacted the second group, Brainbox Investment LTD, who were very direct and explained where they wanted to take the business and where they wanted their investment to go. Their clarity made me realize that they were better for the business, I pitched my idea to them and they agreed to fund the full amount. Brainbox then worked over the next few months to develop the app.
What was your first big breakthrough
Reading Think and Grow Rich by Napoleon Hill was the start of this journey. I never sat there and tried to think of an idea for a business or a product but reading the book trained my mind in a way that made me think and invent solutions to problems and gaps in markets.
What advice would you give to budding entrepreneurs?
First decide if the product you want to create is something that people need or will want, and if you're sure you have something viable then go for it. The world provides you with all the resources you need to start a business no matter what sector. There are always investors looking to finance new ideas so focus your efforts in finding the right people.
This will probably not happen straight away but if you know deep down you have something that will work, then make it work and ignore the initial rejection.
Where do you want to be in five years' time?
In five years’ time I would like to open a Casino near where I live. I’ve already started looking at prices for land in that area.