Hotbox Sports Ventures Inc (the “Company”) has developed a proprietary, highly engaging, ‘next generation’ platform for fantasy sports on the Internet. The Company launched its website with its first sport, fantasy basketball, in October 2008. On April 20th 2010, the U.S. Patent & Trademark Office issued U.S. Patent No. 7,699,707, certifying that the Hotbox Sports® Product is a novel and innovative system.

The Problem

Management believes that the reason football is by far the dominant fantasy sport is in large part because it is the most exciting. It is the most exciting because it is the most unpredictable of any major fantasy sport offered in the US today. Since games are played only once per weekly period, players’ performances on any particular Sunday may show significant variance against the averages of their performances over the course of the season. This high potential variance each week underpins the uncertainty that is the foundation of the excitement and thrill of fantasy football.

Baseball, basketball and hockey games occur much more frequently over the course of a weekly period. Players’ statistics are therefore accrued over the entire week for scoring in the period. Rephrasing the Law of Large Numbers to fit the example – The greater the frequency of play in a period, the greater the probability that players will hit their season long averages during the period. Thus, the players’ performances over the weekly period tend to be closer to their season averages than do those of football players measured only once over the weekly period. Lower unpredictability in these sports essentially puts fantasy owners on cruise control. That is, there is no need to follow each game result. As a result, fantasy sports become disengaging and unexciting fantasy experiences that management and other veterans in the industry believe is the primary reason for much lower participation rates for these sports. Management believes that its patented platform solves the problems in the non-football fantasy sports arena that have made such sports unexciting and unprofitable for large providers of anything other than football, and actual market metrics strongly validate this belief.

The problem with the way fantasy soccer is played today is completely different. Soccer is a game that lacks copious action stats, such as goals, assists on goals, and saves. Each individual league, regardless of country, lacks 10 or more players that have scored 15 or more goals over a 40 game season. Thus the gaming environment, which is restricted to one league in one country, limits the user to a rotisserie based game, rather than a head to head matchup against another fantasy owner. Once a fantasy owner enters the 3rd round of a fantasy league draft, there are no more available players who will have scored more than 8 goals over an entire season. Victories are determined by tackles and passing efficiency rather than action stats, a very unexciting and non-engaging experience. Since fantasy leagues are structured such that players can only be drafted from one league, a country like England hasn’t been able to draft David Beckham, arguably the greatest player in their soccer history, in over 9 years. Markets like Brazil remain untapped because no Brazilian national player plays in Brazil Serie A League. This is why Management wasn’t surprised when it was announced at the 2008 FSTA Conference that Fantasy Bass Fishing was more popular that Fantasy Soccer in North America. Hotbox Sports’ products fix these problems inherent to the way non-football fantasy sports, including fantasy soccer, are played today.

The Solution

For Baseball, Basketball, and Hockey the patented process of HOTBOXSPORTS® breaks the normal week down into 2 to 3 digestible scoring periods per week, then creates uncertainty by reducing the frequency of play per period to one. During each multi-game period, a player can be used only once for scoring. Therefore, not only will unpredictability of performance drive excitement for the sport, but the owner now must strategize for each period by deciding which players on the roster should be started for which games based on which opponents they will be playing in the real world.

For soccer the approach is somewhat different. It is Management’s position that users need to create player pools that are rich enough to make action stats more applicable, and thereby make other non-action statistics obsolete. Hotbox Sports enables this approach by combining the Big 5 leagues in Europe; English Premier League, Italian Series A, Germany’s Bundesliga, Frances Ligue 1, and Spain’s La Liga. By combining these 5 leagues Hotbox Sports creates a player pool that is rich with stars. Over 90% of each country’s national rosters have players playing in what is considered the 5 best leagues in the world. Hotbox Sports also allows fantasy leagues to add up to 2 additional leagues to the core 5, such as the Portuguese, Dutch, Brazilian, or whichever league those fantasy owners prefer. When these leagues are combined, it also creates a gaming environment whereby fantasy owners must decide whether to start a player during tournament play on Tuesday to Wednesday, or over the weekend in interleague play.

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