Underdog raises $35m with eye toward sports betting space
Fantasy sports company valued at $485m following Series B round
Underdog Fantasy is poised to enter the US sports betting space after announcing a $35m capital raise.
Following the Series B round, which Underdog unveiled on July 26 and includes investments from BlackRock and Acies Investment, the rapidly-growing fantasy sports company is valued at $485m.
Underdog plans to use the funds to add over 100 employees while continuing to work on building innovative sports betting products and bringing them to the still-burgeoning US market.
The New York-based startup has already made waves thanks to an extensive list of notable investors, which includes Mark Cuban, Kevin Durant, Trae Young, Odell Beckham Jr. and former Flutter CEO Breon Corcoran.
Underdog now adds to its roster a prominent multinational investment group in BlackRock, as well as Acies, which specializes in the sports betting and online gaming space.
The company’s mission is to lead with product and leverage its database of fantasy users to create accessible and low-cost on-ramps to sports betting.
“While the typical sportsbook is spending over $500 to acquire a customer, Underdog is bringing in new users for a fraction of that,” said Acies managing partner Chris Grove. “Underdog’s product is leading to competitive advantages as Underdog’s customer acquisition and retention success is best in class.”
On the fantasy side, Underdog has shown itself to be continually iterative and forward-thinking, most recently launching a $10m season-long NFL best ball tournament. The prize pool is the largest ever within the season-long format.
“Underdog’s success is driven by the company’s focus on building new, innovative games and delivering amazing customer experiences,” said Grove. “As the company moves into licensed sports betting, I believe that the unique focus on product and experience will reshape the industry.”
“Since the start of Underdog, we’ve believed that building quality products and putting customers first is a winning recipe,” added Underdog president and chairman Jeremy Levine. “We’re excited to continue to innovate and build new experiences from the ground up in fantasy, sports betting and adjacent spaces. This funding round gives us the firepower to continue to build, and build we will.”
While Underdog hasn’t announced a firm timeline for its entry into the US sports betting market, Levine has previously indicated it could be as soon as the end of 2022.