The good news, now that DFS is back in New York, is that the industry is once again considered to be investable. And that’s despite DraftKings market cap being damaged by the various legal challenges it has faced. In July 2015, the company was valued at around $2 billion, and while its valuation was not disclosed during this round of investment, Eilers & Krejcik Gaming has estimated the company\u2019s worth to be around half of that figure today.<\/p>\n
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The analyst also said that, in light of the new investment, a merger between DraftKings and FanDuel would now seem unlikely. In June, it was reported by Bloomberg sources that the companies were engaged in negotiations regarding a merger, which private investors in both companies had been pushing for some time.<\/p>\n<\/div>\n
Consolidation would have made sense, largely because of the amount of money both spend on attempting to out-market one another while offering a very similar service. Then there are the costs to be saved from both companies\u2019 various legal skirmishes in the US. Add the increase in licensing fees and local taxes as DFS becomes regulated on a gradual state-by-state basis, and the attractiveness of a merger becomes clear.<\/p>\n
Consolidation Off the Table<\/h2>\n
In an official statement, DraftKings CEO Jason Robins praised Revolution Growth\u2019s \u201centrepreneurial outlook and spirit of innovation\u201d that \u201cmeshes perfectly with the culture of our company,\u201d as well as its \u201cdeep expertise in sports, technology, and policy.”<\/p>\n
Revolution\u2019s Steve Murray, who will join the DraftKings board of directors as part of the deal, said that his company has the \u201cexpertise to help entrepreneurs execute on their ideas, especially where sports and policy intersect.”<\/p>\n
If the merger is in fact off the table, it is likely that FanDuel could initiate a new round of funding of its own in order to stay competitive.<\/p>\n","protected":false},"excerpt":{"rendered":"
Daily fantasy sports market leader\u00a0DraftKings has raised $153 million in new investment money. Ted Leonsis, the billionaire owner of the Washington Capitals and Washington Wizards sports teams, has bought a significant, but undisclosed, stake in the company through his investment firm Revolution Growth. This is DraftKing\u2019s second major round of funding in just over a […]<\/p>\n","protected":false},"author":42,"featured_media":39203,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[62,10,16],"tags":[],"acf":[],"yoast_head":"\n
Ted Leonsis DraftKings Investment Possible DFS Revitalization Indication<\/title>\n\n\n\n\n\n\n\n\n\n\n\n\n\t\n\t\n\t\n\n\n\n\n\n\t\n\t\n\t\n