FanDuel Could Be Worth $1 Billion With Possible IPO Bid In 2016
The explosion of daily fantasy sports betting companies like DraftKings and FanDuel has been surprising to many. What makes these two companies unique is that they caught onto the idea of offering daily competitions for real money prizes instead of monthly competitions.
When we say real money prizes we are talking nearly a billion dollars handed out in prizes annually between the two. The real money daily fantasy market no longer is a niche industry but has become a serious contender for real money gambling. There is the obvious advantage of not falling under the legal restrictions of gambling due to it being based on skill as well as appealing to a whole new sector of sports fans who do not fall under what many consider the murky world of gambling.
Last year we reported on funding raised by both DraftKings and FanDuel. It is no secret that these two powerhouses are going all out to capture as much as they can of the U.S. market with an eye to going public in the next few years.
According to a report in Fortune the largest daily fantasy sports betting brand, FanDuel is seriously considering an additional round of funding that would mean they would have a valuation of $1 billion.
Last year in September we reported on them receiving $70 million series D round which included investors like NBC Sports Ventures, Karlani Capital, Scottish Investment Bank, Comcast Ventures etc.
Fortune’s Dan Primack said in the article,” FanDuel’s board of directors has not yet approved a new stock sale, but is talking about a round that likely would add at least another $100 million to the company’s coffers. The goal would be to accelerate customer acquisition and pro sports partnership efforts, with an eye toward going public in 2016.”
Currently FanDuel claim to payout over $10 million in daily prizes with their daily fantasy leagues. Their rival DraftKings also received $41 million in funding last year which gave them a post-money valuation of $250 million.
While the sums of cash these two companies are dishing out is huge, it is only the tip of the iceberg should sports betting become legal in the U.S. Just to put things in perspective, recently we reported on NBA Commissioner Adam Silver stating that legal sports betting could be worth $1 trillion to the NBA.