DraftKings raises $153m in venture capital funding

 FanDuel expected to make similar announcement as regulatory worries ease

 

DraftKings has successfully closed a $153m funding round, led by Revolution Growth, an investment firm co-founded by Washington Capitals and Washington Wizards owner Ted Leonsis.

DraftKings said the round was oversubscribed, although it reportedly valued the company at around half of the $2bn valuation it reached last year.

As part of the deal, first reported by Fortune, Revolution Growth partner Steve Murray will be joining DraftKings’ board.

“Revolution Growth is a tremendous new partner for DraftKings, with an entrepreneurial outlook and spirit of innovation that meshes perfectly with the culture of our company,” DraftKings CEO Jason Robins said. “They also have deep expertise in sports, technology and policy.”

“We welcome Steve Murray to our board of directors and look forward to working alongside him and the rest of the Revolution team to realize our vision of building a transformational global sports entertainment and technology platform.”

DraftKings didn’t specify how it would be using the newly raised cash, although it will likely ramp up advertising spend ahead of the NFL season (albeit dialed back compared to last year), and the company is heavily involved in lobbying efforts around the US.

DraftKings is Revolution Growth’s second sports deal after it invested $44m in sports betting data company Sportradar last year.

Revolution partner Steve Murray added: “Building a business is never easy, especially one that is leading the creation of a new marketplace, but Revolution has the expertise to help entrepreneurs execute on their ideas, especially where sports and policy intersect.”

Gaming consultant Adam Krejcik said he expected FanDuel to announce a similar funding round soon, with the new market confidence meaning a merger between the two was unlikely to happen this year.

Seven states have passed DFS legislation this year, including New York.