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DraftKings Inc. is an American gambling company based in
Boston Boston is the capital and most populous city in the Commonwealth (U.S. state), Commonwealth of Massachusetts in the United States. The city serves as the cultural and Financial centre, financial center of New England, a region of the Northeas ...
, Massachusetts. It offers
sportsbook A sportsbook is a venue where a gambler can wager on various sports competitions, such as golf, football, basketball, baseball, ice hockey, soccer, horse racing, greyhound racing, boxing, and mixed martial arts. The method of betting varies wit ...
and
daily fantasy sports Daily fantasy sports (DFS) are a subset of fantasy sport games. As with traditional fantasy sports games, players compete against others by building a team of professional athletes from a particular league or competition while remaining under ...
(DFS) services. The company was originally launched in 2012 as a DFS provider, competing principally with the New York–based
FanDuel FanDuel Group is an American gambling company that offers sportsbook, daily fantasy sports, horse racing, and online casino services. The company operates sportsbooks in a number of states including New Jersey, Pennsylvania, Indiana and West Vir ...
. In May 2018, amid the widening legalization of
sports betting Sports betting is the activity of predicting sports results and placing a wager on the outcome. Sports bettors place their wagers either legally, through a sportsbook or bookmaker (colloquially known as "bookies"), or illegally through priva ...
in the United States, DraftKings began to expand into online and retail sportsbooks to leverage its brand awareness and customer base. DraftKings became a
publicly traded company A public company is a company whose ownership is organized via shares of stock which are intended to be freely traded on a stock exchange or in over-the-counter markets. A public (publicly traded) company can be listed on a stock exchange ( ...
through a
reverse merger A reverse takeover (RTO), reverse merger, or reverse IPO is the acquisition of a public company by a private company so that the private company can bypass the lengthy and complex process of going public. Sometimes, conversely, the public compa ...
with SBTech, a Bulgarian technology company, and
special-purpose acquisition company A special-purpose acquisition company (SPAC; ), also known as a blank check company or a blind-pool stock offering, is a shell corporation listed on a stock exchange with the purpose of acquiring (or merging with) a private company, thus taking ...
Diamond Eagle Acquisition Corp in April 2020.


History

DraftKings was established in 2012 by Jason Robins, Matthew Kalish, and Paul Liberman, former Vistaprint employees. The company initially operated out of Liberman's house. The company's first product was a one-on-one baseball competition, launched to coincide with
Major League Baseball Major League Baseball (MLB) is a professional baseball league composed of 30 teams, divided equally between the National League (baseball), National League (NL) and the American League (AL), with 29 in the United States and 1 in Canada. MLB i ...
's opening day in 2012. In April 2013,
Major League Baseball Major League Baseball (MLB) is a professional baseball league composed of 30 teams, divided equally between the National League (baseball), National League (NL) and the American League (AL), with 29 in the United States and 1 in Canada. MLB i ...
invested in DraftKings, becoming the first US professional sports league to invest in daily fantasy sports. The investment was not disclosed at the time. In February 2014, it was reported that the company awarded $50 million in prizes in 2013 to players in weekly fantasy football, daily fantasy baseball, daily fantasy basketball and daily fantasy hockey. The company also reported 50,000 active daily users and as many as one million registered players. In July 2014, it announced the acquisition of rival DraftStreet, owned at the time by IAC, the third largest player in the fantasy sports space. The acquisition reportedly increased DraftKings' user base by 50%. The company announced it would keep the DraftStreet NY office open and retain some employees. In August 2014, the company announced $41 million in funding from a variety of investors, including
The Raine Group The Raine Group, commonly referred to as Raine, is a global merchant bank focused exclusively on industries related to technology, media and telecommunications (TMT). Companies the firm has been involved with significantly include Endeavor, Sof ...
, as well as existing investors Redpoint Ventures, GGV Capital, and Accomplice. The company also announced that it was acquiring the assets of
Somerville, Massachusetts Somerville ( ) is a city located directly to the northwest of Boston, and north of Cambridge, Massachusetts, Cambridge, in Middlesex County, Massachusetts, United States. As of the 2020 United States census, the city had a total population of 81, ...
, competitor StarStreet. In November 2014, DraftKings reached a two-year deal to become the official daily fantasy sports service of the
National Hockey League The National Hockey League (NHL; , ''LNH'') is a professional ice hockey league in North America composed of 32 teams25 in the United States and 7 in Canada. The NHL is one of the major professional sports leagues in the United States and Cana ...
. The deal included sponsorships of video features and other content across the NHL's digital outlets, co-branded free games with fan-oriented prizes, and in-venue ad placements during marquee NHL events.
Yahoo! Sports Yahoo! Sports is a sports news website launched by Yahoo! on December 8, 1997. It receives a majority of its information from Stats Perform. It employs numerous writers, and has team pages for teams in almost every North American major sport. ...
remained the league's official season-length fantasy sports provider. In April 2015, DraftKings reached a similar deal with Major League Baseball. The agreement allowed DraftKings to offer co-branded MLB daily fantasy games and extend its relationships with individual MLB clubs to offer in-stadium fantasy-related experiences. The company also announced it had received $304 million in users' entry fees in 2014. In July 2015, DraftKings entered into a three-year advertising deal with
ESPN Inc. ESPN Inc. is an American multinational sports media conglomerate majority-owned by the Walt Disney Company, with Hearst Communications as an equity stakeholder. Founded by Bill Rasmussen in 1979, it owns and operates local and global cable and ...
valued at $250 million. This deal included " integration" of the service within ESPN's television and digital content, and having exclusivity in advertising DFS services on its networks beginning in January 2016. Also in July 2015, DraftKings announced a round of funding totaling $300 million, led by
Fox Sports Fox Sports is the brand name for a number of sports channels, broadcast divisions, programming, and other media around the world. The name originates from Fox Broadcasting Company in the United States, which in turn derives its name from Fox Fi ...
, along with the Kraft Group, owners of the
New England Patriots The New England Patriots are a professional American football team based in the Greater Boston area. The Patriots compete in the National Football League (NFL) as a member of the American Football Conference (AFC) AFC East, East division. The Pa ...
, and Boston financial giant Wellington Management. The agreement included a condition stating that DraftKings would spend $250 million on advertising with Fox Sports over the next three years. Due to the
acquisition of 21st Century Fox by Disney The acquisition of Twenty-First Century Fox, Inc. by The Walt Disney Company was announced on December 14, 2017, and was completed on March 20, 2019. Among other key assets, the acquisition included the 20th Century Fox film and television studi ...
in March 2019, Fox's stake is now owned by
The Walt Disney Company The Walt Disney Company, commonly referred to as simply Disney, is an American multinational mass media and entertainment conglomerate headquartered at the Walt Disney Studios complex in Burbank, California. Disney was founded on October 16 ...
. In August 2015, DraftKings announced that it had been granted a license by the
Gambling Commission The Gambling Commission is an executive, non-departmental public body of the Government of the United Kingdom responsible for regulating gambling and supervising gaming law in Great Britain. Its remit covers arcades, betting, bingo, casin ...
in the United Kingdom to operate pool wagering services and that it planned to open an office in London. The company also hired Jeffrey Haas, a veteran of the online poker industry, to serve as Chief International Officer to lead the company's international expansion. DraftKings officially launched in the UK on February 5, 2016, with daily fantasy soccer. As part of the launch, DraftKings enhanced its handling of soccer on the platform to appeal to the local audience. The following year, DraftKings was subsequently awarded a controlled skill games license in
Malta Malta, officially the Republic of Malta, is an island country in Southern Europe located in the Mediterranean Sea, between Sicily and North Africa. It consists of an archipelago south of Italy, east of Tunisia, and north of Libya. The two ...
, which would allow the service to expand into any
European Union The European Union (EU) is a supranational union, supranational political union, political and economic union of Member state of the European Union, member states that are Geography of the European Union, located primarily in Europe. The u ...
country that allows gambling services to operate under licensing from another EU country, such as Germany. On October 5, 2015, an article in ''
The New York Times ''The New York Times'' (''NYT'') is an American daily newspaper based in New York City. ''The New York Times'' covers domestic, national, and international news, and publishes opinion pieces, investigative reports, and reviews. As one of ...
'' indicated that an employee at DraftKings admitted to inadvertently releasing data before the start of week three's NFL football games. That same employee had won $350,000 on rival fantasy site
FanDuel FanDuel Group is an American gambling company that offers sportsbook, daily fantasy sports, horse racing, and online casino services. The company operates sportsbooks in a number of states including New Jersey, Pennsylvania, Indiana and West Vir ...
the same week. An internal review concluded the employee obtained the data after lineups were locked and couldn't have used that data for an unfair advantage. Both DraftKings and FanDuel released statements saying that "Nothing is more important... than the integrity of the games we offer to our customers," and they would work with the entire fantasy sports industry "so that fans everywhere can continue to enjoy and trust the games they love." The following day,
New York Attorney General The attorney general of New York is the chief legal officer of the U.S. state of New York and head of the Department of Law of the state government. The office has existed in various forms since 1626, originally established under the Dutch c ...
Eric Schneiderman Eric Tradd Schneiderman (born December 31, 1954) is an American lawyer and politician who served as the 65th attorney general of New York from 2011 until his resignation in May 2018. Schneiderman, a member of the Democratic Party, spent ten year ...
opened an inquiry into DraftKings and FanDuel, asking each site for a range of internal data and details on how they prevent fraud. ESPN announced on October 6 that they would no longer be running segments sponsored by DraftKings, though paid DraftKings advertisements would continue. In February 2016,
ESPN ESPN (an initialism of their original name, which was the Entertainment and Sports Programming Network) is an American international basic cable sports channel owned by the Walt Disney Company (80% and operational control) and Hearst Commu ...
backed out of its advertising deal with DraftKings due to the legal uncertainties surrounding the service. On May 2, 2016, Lawrence Wasden, the
Idaho Attorney General The attorney general of Idaho is an elected office that assists local law enforcement agencies in the state of Idaho. They provide legal representation for state agencies, state corporations and any persons holding ownership of property, as well a ...
, banned DraftKings and FanDuel from operating in the state, calling them illegal gambling. On November 18, 2016, DraftKings and FanDuel announced their intent to merge. The combined company would serve over five million users. On June 19, 2017, the
Federal Trade Commission The Federal Trade Commission (FTC) is an independent agency of the United States government whose principal mission is the enforcement of civil (non-criminal) United States antitrust law, antitrust law and the promotion of consumer protection. It ...
(FTC) announced that it would seek a preliminary injunction to block the proposed merger. The FTC felt that the proposed transaction would give the combined company 90% of the U.S. DFS market, which is considered to be a monopoly position. On July 13, 2017, the merger was officially called off due to the threat of litigation from the FTC.Tepper, Fitz
"DraftKings and FanDuel will no longer merge"
TechCrunch TechCrunch is an American global online newspaper focusing on topics regarding high tech, high-tech and Startup company, startup companies. It was founded in June 2005 by Archimedes Ventures, led by partners Michael Arrington and Keith Teare. I ...
. July 13, 2017. Retrieved August 3, 2017.
In September 2017, DraftKings and FanDuel each paid $1.3 million to settle with the
Massachusetts Attorney General The Massachusetts attorney general is an elected constitutionally defined executive officer of the Massachusetts government. The officeholder is the chief lawyer and law enforcement officer of the Commonwealth of Massachusetts. The officeholder ...
's office over allegations of unfair and deceptive practices by the companies prior to 2016.


2018–present: expansion into sports betting

In May 2018, the
Professional and Amateur Sports Protection Act of 1992 The Professional and Amateur Sports Protection Act of 1992 (), also known as PASPA or the Bradley Act, was a law, judicially overturned in 2018, that was meant to define the legal status of sports betting throughout the United States. This act ...
was declared unconstitutional by the
Supreme Court of the United States The Supreme Court of the United States (SCOTUS) is the highest court in the federal judiciary of the United States. It has ultimate appellate jurisdiction over all Federal tribunals in the United States, U.S. federal court cases, and over Stat ...
, allowing states outside of Nevada to legalize sports betting. In August 2018, DraftKings launched its first legal online sportsbook in New Jersey. Since launching in New Jersey, DraftKings has opened sports betting operations in New York, West Virginia, Indiana, Iowa, New Hampshire, Massachusetts and Mississippi. In April 2020, DraftKings completed a
reverse merger A reverse takeover (RTO), reverse merger, or reverse IPO is the acquisition of a public company by a private company so that the private company can bypass the lengthy and complex process of going public. Sometimes, conversely, the public compa ...
valued at $3.3 billion that made it a publicly traded company. The merger involved Diamond Eagle Acquisition Corp., a
special-purpose acquisition company A special-purpose acquisition company (SPAC; ), also known as a blank check company or a blind-pool stock offering, is a shell corporation listed on a stock exchange with the purpose of acquiring (or merging with) a private company, thus taking ...
that went public in May 2019, as well as SBTech Global Ltd., a Europe-based company providing technology solutions for sports betting businesses. The combined company keeps both DraftKings' name and its executive management. On April 24, 2020, the company's shares started trading on the
Nasdaq The Nasdaq Stock Market (; National Association of Securities Dealers Automated Quotations) is an American stock exchange based in New York City. It is the most active stock trading venue in the U.S. by volume, and ranked second on the list ...
stock exchange under the ticker symbol "DKNG". Hindenburg Research later published a report alleging that SBTech, which accounted for around 25% of DraftKing's revenue at the SPAC consummation, has ties to organized crime in Bulgaria and illegal gambling around the world. In September 2020, retired NBA player
Michael Jordan Michael Jeffrey Jordan (born February 17, 1963), also known by his initials MJ, is an American businessman and former professional basketball player, who is currently a minority owner of the Charlotte Hornets of the National Basketball Ass ...
became an investor and board advisor at DraftKings. In March 2021, DraftKings acquired the Vegas Stats & Information Network (VSiN), a Las Vegas-based radio network and digital media platform oriented towards sports betting news and analysis, from the family of sportscaster
Brent Musburger Brent Woody Musburger (born May 26, 1939) is an American sportscaster, currently the lead broadcaster and managing editor at Vegas Stats and Information Network (VSiN). With CBS Sports from 1973 until 1990, he was the original host of their ...
. In December 2021, DraftKings was sued by Colossus Bets for patent infringement. Colossus claimed DraftKings infringed seven patents related to a cash-out feature in their sports betting and gaming products. On September 11, 2023, DraftKings issued an apology for a controversial promotion that used the 22nd anniversary of the September 11, 2001, terror attacks to encourage betting on games involving New York-based teams. The promotion, which was criticized for exploiting a national tragedy for business, was quickly removed following public backlash. In 2021, DraftKings agreed to pay at least $50 million over a three-year period to distribute a sports and pop-culture podcast hosted by
Dan Le Batard Dan Le Batard is an American newspaper sportswriter, ex-radio host, podcast host and television reporter based in Miami, Florida. He has also worked at ESPN, and for his hometown paper, the ''Miami Herald'', for which he wrote from 1990 to 2016. ...
. The agreement marks the first major licensing deal struck by Meadowlark Media, founded by Le Batard. The podcast averages around 10 to 12 million downloads monthly. As of July 2021, DraftKings reached a
market capitalization Market capitalization, sometimes referred to as market cap, is the total value of a publicly traded company's outstanding common shares owned by stockholders. Market capitalization is equal to the market price per common share multiplied by ...
of $20.64 billion. In May 2022, DraftKings acquired Golden Nugget Online Gaming. In February 2024, the company acquired lottery courier app Jackpocket for $750 million. In July 2024, DraftKings sold VSiN back to the Musburger family. In September 2024, the company was fined $200,000 by the
Securities and Exchange Commission The United States Securities and Exchange Commission (SEC) is an independent agency of the United States federal government, created in the aftermath of the Wall Street crash of 1929. Its primary purpose is to enforce laws against market m ...
(SEC) for violating Regulation Fair Disclosure when the company's PR team shared material, non-public information about revenue growth on CEO Jason Robins's personal
LinkedIn LinkedIn () is an American business and employment-oriented Social networking service, social network. It was launched on May 5, 2003 by Reid Hoffman and Eric Ly. Since December 2016, LinkedIn has been a wholly owned subsidiary of Microsoft. ...
and X (formerly Twitter) accounts before its official earnings release. For Q4 2024, DraftKings reported a $200 million net loss despite a 13% year-over-year revenue increase to $1.39 billion, bringing its full-year losses to $507 million. The company secured a $500 million loan to support expansion, with a focus on iGaming regulatory challenges.


Legal issues

In December 2024, a lawsuit was filed by the spouse and children of a gambler who used the DraftKings platform, alleging that the company actively encouraged a known problem gambler's addiction, leading him to lose over $900,000. The case argues that online betting platforms have a duty to identify and exclude
compulsive gamblers Compulsive Gamblers were an American garage rock group formed in Memphis, Tennessee, in 1990 by Greg Cartwright and Jack Yarber, both future members of the Oblivians. History First incarnation Originally known as "The Painkillers", the band ...
. The same month, a former client named Jeffrey Wan filed a
class action A class action is a form of lawsuit. Class Action may also refer to: * ''Class Action'' (film), 1991, starring Gene Hackman and Mary Elizabeth Mastrantonio * Class Action (band), a garage house band * "Class Action" (''Teenage Robot''), a 2002 e ...
lawsuit against DraftKings in New York federal court, alleging that the company unlawfully shared users'
personally identifiable information Personal data, also known as personal information or personally identifiable information (PII), is any information related to an identifiable person. The abbreviation PII is widely used in the United States, but the phrase it abbreviates has fou ...
(PII) with third parties. Wan claims that DraftKings used the Facebook pixel tracking tool to record and send users' website and app activity to Facebook. Later in December 2024, Texas resident Eric Avila filed a class action lawsuit in the US District Court for the District of Massachusetts, alleging that DraftKings fraudulently closed users' accounts and stole their remaining balances. Avila claims that DraftKings terminated his account under false pretenses and that he was unable to get his money back. In April 2025, the city of
Baltimore Baltimore is the most populous city in the U.S. state of Maryland. With a population of 585,708 at the 2020 census and estimated at 568,271 in 2024, it is the 30th-most populous U.S. city. The Baltimore metropolitan area is the 20th-large ...
, Maryland, filed a lawsuit against DraftKings and FanDuel, alleging that the companies are engaging in "deceptive and unfair practices by targeting and exploiting vulnerable gamblers in violation of Baltimore's Consumer Protection Ordinance (CPO)."


References


External links

* {{Fantasy sports Browser-based game websites Fantasy sports websites Daily fantasy sports Companies based in Boston 2012 establishments in Massachusetts American companies established in 2012 Internet properties established in 2012 Sports betting Companies listed on the Nasdaq Special-purpose acquisition companies