DraftKings Inks $300 Million in Funding

Draft-Kings-Banner

Nearly a month to the day an ESPN funding deal fell through, DraftKings has announced that they have secured an additional $300 million in funding led by FOX Sports. Of the $300 million, FOX Sports has committed $150 million with the agreement also calling for DraftKings to spend $250 million in advertising over the next three years at FOX Sports.

DraftKings had previously received $75 million in capital as of August of last year. Leading rival FanDuel only secured another $275 million a couple weeks ago bringing their total to around $362 million in announced funding.

In addition to an aggressive push for funding and growing the business through venture capital, DraftKings has also cemented agreements with major sports leagues including MLB, NHL, NASCAR, UFC and MLS. They also inked a high profile sponsorship at this year’s high profile Belmont Stakes.

DraftKings Deal Means Company Can “Do what we want”

DraftKings plans to use their funding for growing and building their web and mobile platform, expanding internationally (such as a planned United Kingdom entry later this year) and exploration into “new opportunities for vertical expansion.” Jason Robins, CEO of DraftKings told Re/code that DraftKings now new flexibility to grow the company. “We have plenty of money to do what we want now… our long-term vision is to make DraftKings and the sports themselves attached at the hip.”

In the DFS site’s official statement on the deal Robins was appreciative of the support the company has receive. “To receive this type of support from such an outstanding group of organizations, including three major sports leagues, is an incredible milestone for us and reaffirms our leadership position in Daily Fantasy Sports. We intend to leverage these resources to develop even more innovative daily fantasy sports contests and provide new exclusive once-in-a-lifetime experiences for our players.”

According to Re/code, the deal with FOX Sports is very similar to the agreement that was being worked on with ESPN last month which collapsed due to trepidation from parent company Disney about partnering with a real money fantasy sports website. Despite that deal falling through, DraftKings was able to agree with ESPN on an exclusive advertising deal with the sports network for around $250 million. But unlike that deal, the FOX Sports agreement does not include an exclusive ad partnership, meaning other daily fantasy sports sites such as FanDuel could still advertise with FOX Sports.

Organizations Contributing to Latest DraftKings Funding Round

In addition to the funding commitment from FOX Sports, DraftKings also received investment from a who’s who of top organizations with this latest deal:

American sports leagues: Major League Baseball, the National Hockey League and Major League Soccer

Sports organizations: Madison Square Garden Company and Legends

Venture capital organizations: Atlas Venture, DST Global, GGV Capital, The Kraft Group, The Rain Group and Wellington Management Company LLP