The Key Advantage FanDuel Thinks It Holds Over DraftKings In US Sports Betting

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FanDuel has topped the young US sports betting market to date with a 44% share of markets where it is live.

The company offered an insight into why it believes that’s the case last week in an earnings call from FanDuel parent Flutter Entertainment.

FanDuel CEO Matt King was asked about his company’s competition with DraftKings and who might have the edge going forward.

His response:

“There’s a lot of things that are similar as DFS brands, but there are some differences reflective of the access we have to the global Flutter group. Our risk and trading strategy is more advanced and more sophisticated in terms of breadth and innovation around things like same-game parlays. That’s a result of being able to access group resources rather than outsourcing risk and trading.”

FanDuel sees advantage of extending to retail

King said FanDuel Sportsbook had a similar edge in retail bookmaking in places like Meadowlands in New Jersey, again thanks to group expertise. Flutter runs around 600 Paddy Power betting shops in the UK and Ireland.

“Those things have really helped us differentiate,” King said.

The company now has around 1,000 staff in the US, with many experienced online gambling execs parachuted in from the Flutter businesses in the UK and Australia.

Can DraftKings close the gap?

King was asked whether DraftKings Sportsbook might shrink that gap once it closes the acquisition of SBTech, and own its own tech and pricing.

“That’s an emulation of the strategy we started 18 months ago [when Flutter acquired FanDuel],” King said. “The reason the deal made sense was access to proprietary risk and trading, and proprietary tech. If you’re simply using a B2B partner, you’re going to look the same as everyone else. I would argue DraftKings came to the same conclusion we did but 12 months later.”

When analysts pressed further, Flutter CEO Peter Jackson interjected to say, “If you want to know more about what DraftKings is doing, I suggest you go and ask them.”

DraftKings may indeed be closing the tech gap, but that deal is not without risks. It also could be a long way from having a tangible impact on the DraftKings product.