Before 2006 betting on sports online was as simple as having a bank account and a computer with an internet connection. The Unlawful Internet Gambling Enforcement Act (UIGEA) of 2006 changed that but left enough of an opening for a new concept like FanDuel. FanDuel skirts around UGIEA by technically being a “fantasy sports” site which is exempt from gambling restrictions under the UIGEA.

Their games are not your traditional season long rotisserie or head-to-head leagues but rather single day or single week (for football) contests that allow you to gamble without technically gambling. It’s actually quite genius. FanDuel manages to wiggle through UIGEA by being a “game of skill” rather than a “game of chance.”

It works like this: you sign up for a game with a salary cap or create your own game for friends. For example: a $5.00 entry fee for a $60k salary cap team. Then you select your team staying within that salary cap and hope that you end the day with the most points. Cha-ching!

Beyond the cash payouts it’s the duration of the games that sets FanDuel apart from your standard Yahoo or ESPN leagues. I can’t remember the last time I was able to stay focused for the whole football or baseball season in a fantasy league. Usually I stress over the draft and then lose interest when I’m in second to last place after a month. Now I don’t have to worry about player durability, stress over trades, or just staying interested because I’m not building a roster that needs to last four or five months. It’s a lot simpler to just play when you feel like it rather than commit to a full season.

FanDuel is a fantastic idea and genius in the way it gets around UIGEA. Online gambling has also proven to be a lucrative business and investors are keenly aware of this. Recently FanDuel took on another round of funding from its investors on top of a 4x increase in revenue last quarter. With baseball in full swing you can expect that revenue number to increase even more.

This site has taken the best social networking aspects of traditional fantasy sports games and adapted them to the gambling world. Essentially it’s a sport gambling social network and a company to keep an eye on in the coming years.

(Photo credit: http://www.fanduel.com)