Fresh off agreeing to a merger with archrival Fan Duel (which has yet to b , DraftKings has some heavy investment coming.
According to Bloomberg reporter Scott Soshnick, the daily fantasy company has received more than $100 million in investment from a group led by Los Angeles Dodgers part owner Todd Boehly’s firm Eldridge Industries LLC.
BREAKING: @Dodgers owner Todd Boehly's Eldridge Industries leads investment in @DraftKings. Sources say Series E1 round > $100M #sportsbiz
— Scott Soshnick (@soshnick) March 9, 2017
This is DraftKings’ first round of investment since announcing the merger, which still requites antitrust approval. According to Bloomberg, FanDuel and DraftKings combined control 90 percent of the daily fantasy industry, raising concern that their partnership constitutes a monopoly.
Boehly is a partner at Guggenheim, the investment firm that owns the Dodgers.
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“We were looking for a funding partner who could bring additional depth to the table,” DraftKings Chief Executive Officer Jason Robins said in the statement. Eldridge Industries, whose properties include Dick Clark Productions as well as Billboard magazine and the Hollywood Reporter, has a “deep bench of experts to help fuel DraftKings’ continuing growth as a sports entertainment company.”
The last time we heard from DraftKings, it (along with FanDuel) was fighting legal wars on many different fronts, hoping to establish that daily fantasy was not illegal gambling. Those battles were resolved differently in different states, and daily fantasy remains banned in several states. Though DraftKings and FanDuel were both reportedly valued over $1 billion during their peak in the fall of 2015, the outlook has soured considerably in the year and a half since, and neither company was ever profitable, per Bloomberg.
Still, DraftKings has some major investors behind it, and if the merger is approved the company won’t need to engage in the type of advertising arms race it previously got wrapped up in. A lot of dominos still have to fall, but DraftKings could be getting a second wind.
