Boom Fantasy also said it acquired the assets of former DFS operator Draftpot, which had once been one of several start-ups seeking to make in-roads in the industry.
The new round is pocket change compared to the hundreds of millions of dollars that DraftKings and FanDuel have raised. But it’s still an investment into an industry that has seen brakes pumped on expansion in the past two years.
More on the investment round for Boom Fantasy
The round was led by Founders Fund’s FF Angel. Cyan Banister, a partner at Founders Fund who has established herself as one of the premier early-stage investors with her investments in Uber and SpaceX, led the investment.
“Boom Fantasy is incredibly fun — both for diehard sports fans and for casual fans who want something to root for. This was the first fantasy sports company that I was truly excited about,” Banister said via a press release. “Boom Fantasy is poised to rapidly rise in an industry that has overcome regulatory scrutiny and expects substantial growth in the years ahead.”
In a press release, Boom Fantasy said new funds will go toward product advancement and player enhancements.
“Boom Fantasy’s mission is to increase the thrill of sports for every fan,” said Assaf Einat, CTO of Boom Fantasy. “With this acquisition and funding round, Boom Fantasy will have larger prize pools, exciting new gameplay, and even better customer support. We look forward to offering an unparalleled fantasy sports experience for our players.”
The move to acquire Draftpot will increase Boom’s player database; Boom Fantasy said adding Draftpot’s users would double its available users. Draftpot stopped offering contests in 2016.
Boom Fantasy had previously raised $1.4 million in 2015 before launching last year.
Boom Fantasy offers a differentiated form of fantasy
If nothing else, Boom Fantasy offers a different way to look at DFS.
Much of the DFS industry exists under the salary-cap model pioneered by FanDuel and DraftKings. Yahoo and FantasyDraft operate along those lines. But Boom Fantasy diverges from that model in a major way.
The contest lobby will look familiar to DFS players, with a variety of offerings with varying entry fees. But the contests themselves are nothing like the rest of the DFS space. Users in contests are asked a series of player-performance questions, like “Who will score more points tonight: LeBron James or Steph Curry?’
“Boom Fantasy was founded on a simple premise — that FanDuel and DraftKings just weren’t all that fun,” said Stephen A. Murphy, CEO of Boom Fantasy. “We knew we could create a better game that appealed to real sports fans — not just the high-volume professionals. We are excited to use these new funds to take our product to the next level.”
Some might question if Boom Fantasy is really a form of DFS. But it satisfies the requirements of fantasy sports bills and laws in many states. In reality, it is one of a number of legal sports betting precursors that have cropped up in recent years.
Boom is currently running a $100,000 contest based on the NBA Finals.
Consolidation and acquisition in DFS
The DFS industry, after a period of growth and start-ups trying to get into the space, has gone into a different mode in the past two years. Contraction and consolidation has been common in the industry:
- FanDuel and DraftKings plan to merge this year, if they win approval from the federal government under anti-trust laws.
- A number of sites stopped operations or went insolvent. The most infamous of those is Fantasy Aces, which declared bankruptcy earlier this year while owing players more than a million dollars. In bankruptcy proceedings, FantasyDraft took over the Aces database and largely made users whole.
- Other sites have been swallowed up or acquired in the tough economic and regulatory environment that exists for DFS. Most recently, Global Daily Fantasy Sports took over Mondogoal in the B2B space. Earlier this month, Paddy Power Betfair announced the acquisition of mobile-first DFS operator Draft.
Regardless of all of those developments, the new investment in Boom Fantasy is a sign that the DFS industry is likely not done evolving.