“This Week In Daily” is ODFReport’s weekly wrap of key facts, happenings and miscellany from the daily fantasy sports industry.
Stories of note
DraftKings’ Busy Week
It’s not a done deal yet, but if it happens, it would be a gamechanger. Disney is in “early talks” with DraftKings about a possible investment in the second-largest daily fantasy sports site on the planet.
Forbes broke the story that Disney — and by extension, ESPN — was looking into DraftKings. The new round of funding, if and when completed, would move DraftKings past a billion-dollar valuation. Analysis of the news and its potential impact from ODFReport’s Chris Grove here.
And DraftKings wasn’t done there. The DFS site also signed a deal with WWE — but not to provide fantasy sports for pro wrestling. DraftKings will offer its players a chance to win “the ultimate trip to SummerSlam,” a WWE event.
There will also be promotion of the DraftKings contest via the WWE’s social media and television platforms leading up to the biggest pay-per-view event of the year, Wrestlemania. Clearly the deal will help DraftKings with name recognition. Apparently, we’ll also find out how much wrestling fans and DFS players cross over via this venture, or if the former can be converted into the latter.
Video Game DFS Growing Quickly
Real-money daily fantasy contests based on video games — or “eSports” — haven’t been around very long. But interest has skyrocketed in the two months that Vulcun has operated DFS contests based on League of Legends, a multiplayer online battle arena game.
In January, Vulcun was promising prize pools of a quarter of a million dollars for all of 2015. Just two months later, and that number has increased to $4 million.
Lots of people like watching other people play video games: see the explosion of Twitch. Just like sports fans, they also like to have money riding on the outcome, if the growth at Vulcun is any indicator.
And Vulcun isn’t even the only player in the space, as Alpha Draft is also offering real-money contests — with a slicker presentation and daily contests that rival some established non-eSport DFS sites.
Of the week
Read(s) of the week
The mobile-only DFS app — called simply Draft — launched in December. Three months later, Draft has gotten $3.5 million in funding. It’s yet another sign that the DFS market is white-hot, despite the fact that every company in the space is losing money.
StarStreet founder Jeremy Levine made the announcement this week, along with the launch of a head-to-head fantasy game centered on March Madness. DFS sites have yet to figure out the key to truly tapping into the NCAA tournament, which sees $9 billion wagered in office pools across the country. It will be interesting to see if Draft can crack the code.
On its own, a little bit of movement on the state level for DFS legalization might not seem like that big of a deal. But, in the larger picture, Iowa might be a microcosm of a coming fight for the industry.
While the DFS bill easily passed the state senate and moves on to the house, it wasn’t without its detractors. One senator said “I don’t think you can legitimately say that there’s no chance, no gamble involved.” Another said “This is an expansion of Iowa gambling.”
We saw the same thing happen in Washington, as lawmakers questioned whether DFS is a game of chance or a game of skill.
Daily fantasy sports, as it skyrockets in popularity, is bringing with it attention from a lot of different corners. We doubt this is the last time we’ll hear someone raise the issue of whether DFS is actually gambling.
Tweets of the week
— Andrew Feldman (@AFeldmanESPN) March 17, 2015
–In reference to a story that a soccer DFS site would be the first to offer fantasy games based entirely on a women’s sport.
If you thought you saw a lot of FanDuel & DraftKings commercials this past year just wait until this upcoming NFL season. — Adam Krejcik (@akrejcik) March 16, 2015
Every category is getting picked up in daily fantasy. DraftKings just signed a deal with WWE.
— Darren Rovell (@darrenrovell) March 18, 2015
Quote of the week
“It was a total 180 from the prior 5 years of going out to raise money. I had to beg for StarStreet investors and now people are begging to give us money. We set out to take $3 million, but so many people wanted to come in that we took $3.5 million.”
–Jeremy Levine, founder of the fantasy sports app Draft, on fundraising for his latest venture.
Number of the week
The number of DFS sites that will have billion-dollar valuations in the coming months if fundraising goes as planned for FanDuel and DraftKings.