DraftKings Closes $41M Round Led by Raine; Buys Daily Fantasy Site StarStreet
DraftKings Also Unveils Industry’s First-Ever Fantasy Football Millionaire Series as Part of Historic, $100M NFL Season Prize Package; New Funding Solidifies DraftKings’ Standing as the Largest U.S.-Based Destination for Fantasy Sports
BOSTON, August 25, 2014-- DraftKings, Inc., today announced that it has closed a $41 million Series C round of funding led by The Raine Group, with participation from existing investors Redpoint Ventures, GGV Capital, and Atlas Venture. DraftKings also announced that it has acquired the principal assets of Cambridge, Mass.-based daily fantasy site StarStreet, further bolstering its status as the largest U.S.-based online destination for daily fantasy sports. Terms of the deal were not disclosed.
DraftKings will use the Series C funding to further enhance its mobile and online destinations, bolster its base of users, continue to attract highly skilled employees, and offer a richer variety of sports with increased guaranteed contest prizes, including its NFL Fantasy Football Millionaire series. In this first-of-its-kind contest, DraftKings will award four players $1 million in four months—the span of the NFL regular season. The Fantasy Football Millionaire series is the largest promotion in history for daily fantasy sports and is part of DraftKings’ plan to award more than $100M in collective prizes this NFL season.
The NFL Millionaire Series follows quickly on the heels of yet another massive fantasy sports contest from the company. Tomorrow, DraftKings is hosting the $3.3 Million Guaranteed Fantasy Baseball Championship at the Atlantis Resort in the Bahamas, with 50 daily fantasy baseball lineups vying for the million dollar top prize.
“This round of funding, led by Raine with their vast experience and network in the sports and entertainment space, allows us to significantly increase our player base and liquidity as we add StarStreet to the DraftKings family,” said Jason Robins, CEO and co-founder of DraftKings. “This is a groundbreaking week for DraftKings. We expect the growth in contest sizes and variety to continue. We look forward to continuing to transform the industry through technology innovation and larger and even more exciting contests, cementing our position as the best destination for daily fantasy sports.”
To date, DraftKings has raised almost $75M in venture capital, using that to catapult onto the daily fantasy sports scene. Since launching in April 2012, DraftKings has risen through the ranks to become the largest U.S.-based daily fantasy sports company. The past six months have seen two major acquisitions and record-breaking contests in multiple sports. The StarStreet acquisition comes just one month after DraftKings purchased DraftStreet.
Nearly 37 million people in the United States and Canada—nearly 1 in 8 adults and 1 in 5 males—play fantasy sports. Daily fantasy sports are a burgeoning component of this multi-billion dollar market.
“Daily fantasy sports represents a tremendous area for growth in the multi-billion dollar world of fantasy sports, and Raine is pleased to lead this investment round for DraftKings,” said John Salter, Partner with The Raine Group. “DraftKings has established the optimal mix of cutting edge technology, broad industry knowledge and a deeply loyal user base to further push its leadership in this space and we are delighted to partner with them as they continue to expand.”
DraftKings offers contests for experts and casual players alike—many contests are free, and others can award prizes up to $1 million for an investment as small as a quarter. In addition to daily fantasy baseball, DraftKings also offers fantasy contests in major professional and college team sports.
About The Raine Group:
Raine Group is a global merchant bank focused exclusively on entertainment, digital media and sports. Founded in 2009 by Joseph Ravitch and Jeffrey Sine, in partnership with WME Entertainment, Raine has offices in New York, Los Angeles, Palo Alto and Shanghai. With a global reach, Raine focuses on growth equity investments, where its deep industry experience and unique network of strategic relationships, limited partners and advisory board members can create value for portfolio companies. For more information, visit http://www.raine.com/.
Launched in April 2012, Boston-based DraftKings, Inc. is the largest, US-based online gaming destination where players engage in daily fantasy sports competitions across fantasy football, baseball, golf, basketball, hockey, and college football and basketball. DraftKings offers free and pay contests every day that award cash prizes. All contests feature a salary cap format, and new contests are offered every day with instantaneous prize distribution for winners. For more information, visit us at www.draftkings.com, like us at www.facebook.com/draftkings, and follow us at www.twitter.com/draftkings.
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