Just how big of a business is daily fantasy sports overall?
Well, DraftKings, one of the top daily fantasy sports-for-cash websites, has raised $300 million in new funding led by the Fox Networks Group. DraftKings reportedly plans on spending $250 million of that amount on advertising with Fox over the next three years. So, be prepared to see plenty of DraftKings ads.
This news comes two weeks after DraftKings' main rival, FanDuel Inc., raised $275 million in funding, with Time Warner and Comcast Inc. as investors. FanDuel raked in $57 million in revenue in 2014, while DraftKings earned $30 million in revenue last year. Daily fantasy-sports companies charge entry fees and each take comission of nearly 10 percent of every game played.
Experts from Eilers Research told the Wall Street Journal that daily fantasy sports is expected to generate $2.5 billion in annual revenue in the United States alone by 2020.
DraftKings and FanDuel, in particular, are doing so well on the daily fantasy sports scene that many are wondering if the massive investments will lead to acquisitions.
"I wouldn't be surprised at all to see an [initial public offering of stock] or an acquisition," said Sam Hamadeh, chief executive of PrivCo, a financial data service, to the Wall Street Journal. "Media boards, however, are picky. It would have to be a very big public-company buyer — or an IPO."
With the start of the 2015 NFL season less than 50 days away, the question is will you play daily fantasy football with DraftKings or FanDuel or will you stick to season-long fantasy platforms?
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