If you’re into fantasy sports for real money you may want to check out DraftKings if you haven’t already. The hot Boston startup just raised $1.4 million dollars in venture capital to expand their marketing efforts and beyond Major League Baseball. They plan to add football, basketball and ice hockey to their already lucrative sports gaming business.
The legal, money betting fantasy sports startup offers same day settlement of cash prizes. They operate in 44 states excluding: Arizona, Iowa, Louisiana, Maryland, Montana and Vermont where it’s not legal to participate in online “gambling”.
The $1.4 million dollar seed round was led by Atlas Venture. Boston Seed Capital, Hub Angels, Angel Street Capital and other private investors also participated in the round.
Thirty-two million people play fantasy sports in the US and Canada, and two-thirds of all fantasy sports leagues involve fees and payouts that are typically managed offline by a designated member of the league. DraftKings simplifies the process by handling financial transactions through its site while collecting a commission on every stakes game.
“While fantasy sports have been around for 50 years, online daily fantasy sports is much younger and growing rapidly. The sector is ripe for innovation via an analytical approach to marketing and customer relationship management,” said Jason Robins, DraftKings CEO and co-founder.
“There’s an opportunity for a daily fantasy sports platform to dominate the current field,” said Ryan Moore, partner at Atlas Venture. “With a deep understanding of successful gaming franchises, and expertise in customer acquisition and retention, the team at DraftKings has the potential to quickly achieve the top position in this market.”
Sports fans are flocking to DraftKings because they’ve cut away some of the fat associated with other fantasy sports sites. This way DraftKings can focus on players’ favorite aspects of fantasy gaming:
1. Daily fantasy sports games. No more season long commitments.
2. A community at the ready to play. No more hustling to round up a league.
3. On demand draft. Players can pick a new team whenever they choose, which is much more fun than scrounging to substitute mid-season.
4. Players are never “out of contention”. No more going an entire season with a poorly performing team. Engagement remains high for the duration.
5. Daily payouts. For those games involving financial stakes, players can collect immediately.
6. Onsite settlement. DraftKings handles the transactions and distribution of proceeds, freeing up precious administrative time.
“Playing fantasy sports should be fun and easy. Our approach is data-driven, but those themes underlay every customer-facing decision we make,” said Matt Kalish, COO and co-founder.