This is a developing story and will be updated.
DraftKings is getting bigger. A lot bigger.
The daily fantasy sports company said it is moving its headquarters within Boston. It has also started what it calls “an aggressive hiring campaign” that the company says will increase the size of the company by 75 percent in the next 18 months.
More on the DraftKings move
Here’s what we know, via DraftKings:
- The DFS company plans to grow from 425 employees to more than 700 by the middle of 2019. About 600 of those positions will be based in Boston. The move will take place in 2019.
- DraftKings also unveiled plans for a new Boston headquarters. The company will now be located at 500 Boylston Street in the Back Bay neighborhood of Boston. The new space is 105,000 square feet and more than double the size of DraftKings’ current office.
- DraftKings said that the move will come with an expansion of its in-house media production studio.
“We are entering an exciting phase of accelerated growth at DraftKings as we continue to develop new products and diversify our offerings. To meet these needs and remain at the forefront of innovation, DraftKings is focused on hiring top talent,” said Jason Robins, co-founder and CEO of DraftKings, in a press release.
“We are also honing in on our commitment to Boston by opening a new headquarters in the city. We’re especially thankful to Governor Baker, Mayor Walsh and the state’s legislative leadership for their continued support of our company and Boston’s thriving tech economy.”
Why now for DraftKings?
The last year has not exactly been one for explosive growth in the DFS space, although DraftKings has said its numbers — active users and revenue — are up year over year.
Despite that, there are lots of reasons for DraftKings to eye expansion:
- DraftKings has designs on the sports betting space. The New Jersey sports betting case in the US Supreme Court could strike down the federal ban. And the user database and platform of DraftKings could be attractive if that happens. Of course, a move into the sports betting space could be complicated by the equity the likes of Major League Baseball and the NHL have in DraftKings.
- It’s clearly in the lead in the DFS industry. Whereas FanDuel once held a huge edge over DraftKings — founded in 2012 — the latter is by far the bigger DFS platform. There is certainly interest in continuing to create a larger gap between the companies.
- DraftKings has been expanding internationally and wants to make further in-roads. It’s already in the UK (FanDuel left last year), Germany, Austria and Ireland. In order to really grow the international market, more resources will be required.
Of course, whether that cocktail of variables warrants massive expansion is in the eye of the beholder. The last known investment in DraftKings came about a year ago, to the tune of $100 million. Whether it is seeking to raise more funds for the expansion — or if it has already raised behind the scenes to make this possible — is unknown.
Meanwhile, what’s going on at FanDuel?
Growth has not been on FanDuel’s agenda. Instead, DraftKings’ competitor has said on more than one occasion that it is focused more on profitability, and that it will reach that goal for the entirety of 2018.
What do we know about what’s going on at FanDuel?
- CEO Nigel Eccles left at the tail end of 2017, followed soon after by co-founder Tom Griffiths.
- Some staff has been laid off.
- The company said at a hearing in New York that it employs about 100 people at its NY headquarters. There are still a large number of employees based in Scotland.
Signs seem to point to the company being sold sometime in 2018.