Paradise said he became frustrated with mobile in-game ads disrupting his gaming experience. He decided to create an ad-free gaming experience and find a way for game developers to monetize their content. The founder claims that with more than 1.5 billion mobile gamers worldwide, he hasn't just created a new company, he's "created an entire new industry."
Gamers pay a fee for each tournament they enter, and each tournament has different entry fees. Tournaments have predetermined cash prizes, which can range from $1 to thousands of dollars. Skillz runs 100,000 tournaments daily and pays out approximately $10,000 to its gamers. Skillz told CNBC it cannot reveal the identity of the gamer that scored the big $46,000 win, but said the bulk of her winnings came from the matching game, Diamond Strike (talk about striking gold!).
On average, the company generates 31 cents per player in revenue per day.
During the "Power Pitch" panel, Wu asked Paradise what type of customer plays these games for real money.
"We get about 35 percent of every day's traffic in a given game to come in and try the tournament system. The most hardcore players are actually playing multiple hours per day on their mobile devices. And the average on the system right now is about 38 minutes per day per tournament player," Paradise said.