DraftKings
| Company type | Public company |
|---|---|
| Industry | Gambling |
| Founded | 2012 |
| Founder | Jason Robins, Matt Kalish, Paul Liberman |
| Headquarters | Boston, Massachusetts , United States |
Area served | United States, United Kingdom, Europe |
Key people | Jason Robins (CEO) |
| Products | Sportsbook operations, daily fantasy sports |
| Website | draftkings |
DraftKings Inc. is a U.S.-based gambling enterprise located in Boston, Massachusetts, that specializes in sportsbook operations and daily fantasy sports (DFS) offerings.
Established in 2012 by Jason Robins, Matt Kalish, and Paul Liberman, DraftKings initially concentrated on daily fantasy sports, competing mainly against New York’s FanDuel. With the legalization of sports betting expanding across the United States, the company extended its services in May 2018 to include both online and retail sportsbook platforms, capitalizing on its recognized brand and existing customer network.
The firm became publicly traded in April 2020 through a reverse merger involving Bulgarian tech company SBTech and the special-purpose acquisition entity Diamond Eagle Acquisition Corp, marking a pivotal advancement in its market presence and corporate development.
History
DraftKings was launched in 2012 by Jason Robins, Matthew Kalish, and Paul Liberman, all formerly employed at Vistaprint. Their inaugural product was a head-to-head baseball contest introduced on Major League Baseball's (MLB) opening day in 2012.
In April 2013, MLB became the first professional sports league in the U.S. to invest in daily fantasy sports by supporting DraftKings. By 2014, DraftKings had distributed $50 million in prizes across various fantasy sports, boasting 50,000 active daily participants and nearly one million registered users.
In July 2014, DraftKings expanded its user base by 50% through acquiring rival DraftStreet from IAC and retained several of its employees. The following month, the company secured $41 million in funding from investors such as The Raine Group and Redpoint Ventures while also acquiring assets from competitor StarStreet.
November 2014 saw DraftKings enter a two-year agreement to become the official daily fantasy sports provider for the National Hockey League (NHL), which included sponsorship opportunities and advertising within venues. In April 2015, it renewed its exclusive partnership with MLB to deliver co-branded games and enhance fan experiences at stadiums. For the year 2014, DraftKings reported user entry fees totaling $304 million.
In July 2015, DraftKings inked a $250 million advertising contract spanning three years with ESPN for integration across television and digital platforms, securing exclusivity for daily fantasy sports advertisements starting January 2016. That same month, it raised $300 million in funding led by Fox Sports, the Kraft Group, and Wellington Management, pledging $250 million toward Fox Sports advertising over the subsequent three years. Following Disney’s acquisition of 21st Century Fox in 2019, Fox’s ownership stake transitioned to Disney.
International expansion commenced with DraftKings obtaining a UK Gambling Commission license in August 2015 and launching daily fantasy soccer in the UK by February 2016. Subsequently, it acquired a Malta gaming license to support broader entry into European markets.
In October 2015, DraftKings encountered controversy after an employee accidentally accessed competitor data; however, an internal investigation cleared the company of any misconduct. New York Attorney General Eric Schneiderman initiated a probe into fraud prevention measures at both DraftKings and FanDuel. As a result, ESPN discontinued sponsored segments featuring DraftKings but maintained paid advertisements until February 2016 when it ended all advertising amid ongoing legal uncertainties.
In May 2016, Idaho prohibited DraftKings and FanDuel as unlawful gambling operators. The two companies announced plans to merge in November 2016 to serve more than five million users; nevertheless, the Federal Trade Commission blocked the merger in June 2017 due to antitrust concerns. The merger was formally terminated in July 2017.
By September 2017, both firms reached settlements with the Massachusetts Attorney General’s office for $1.3 million each regarding previous allegations of unfair business practices.
2018–present: growth into sports wagering
Following the Supreme Court's May 2018 decision to overturn the Professional and Amateur Sports Protection Act of 1992, states outside Nevada gained the authority to legalize sports betting. By August of that year, DraftKings introduced its inaugural legally sanctioned online sportsbook in New Jersey and extended its services across the United States.
DraftKings went public in April 2020 through a $3.3 billion reverse merger involving Diamond Eagle Acquisition Corp., a special purpose acquisition company (SPAC), and SBTech Global Ltd., a European firm specializing in sports betting technology. The merged entity preserved the DraftKings brand and leadership team, trading on Nasdaq under the ticker "DKNG". At the time of the merger, SBTech accounted for approximately one-quarter of total revenue but was simultaneously embroiled in allegations concerning connections to illicit gambling operations.
In September 2020, retired NBA legend Michael Jordan became an investor and joined DraftKings' board as an advisor, enhancing investor confidence. By March 2021, DraftKings expanded its media presence by acquiring Vegas Stats & Information Network (VSiN), a sports betting media outlet established by Brent Musburger’s family. Later that year, the company encountered a patent infringement claim from Colossus Bets related to cash-out functionalities.
In September 2023, DraftKings issued an apology following public criticism over a marketing campaign that controversially referenced the September 11 attacks to promote wagering on New York-based teams.
The company made significant content investments, including a $50 million licensing agreement in 2021 for a well-known podcast hosted by Dan Le Batard, marking a milestone media collaboration. By mid-2021, DraftKings’ market value had climbed to $20.64 billion.
To broaden its market presence, DraftKings undertook strategic acquisitions such as Golden Nugget Online Gaming in May 2022 and the lottery courier service Jackpocket for $750 million in February 2024. In July 2024, DraftKings sold VSiN back to the Musburger family.
Regulatory oversight intensified when the Securities and Exchange Commission fined DraftKings $200,000 in September 2024 due to premature revenue growth disclosures made by CEO Jason Robins via social media. Later that year, U.S. Senators Mike Lee and Peter Welch called for antitrust investigations into DraftKings and FanDuel over suspected anti-competitive conduct following their unsuccessful merger attempt.
From a financial perspective, DraftKings posted a net loss of $200 million in Q4 2024 despite revenues increasing by 13% to $1.39 billion; annual losses totaled $507 million. To support ongoing expansion amid regulatory hurdles in iGaming, the company secured a $500 million credit facility.
In June 2025, DraftKings filed paperwork to form a corporate political action committee (PAC) aimed at backing candidates and groups aligned with its commercial objectives.
Legal issues
In December 2024, DraftKings was sued by the family of a gambler who lost more than $900,000 on its platform, alleging that the company fostered his gambling addiction and failed to exclude compulsive bettors. This lawsuit underscores the accountability online wagering platforms bear regarding problem gambling management.
Also in December 2024, Jeffrey Wan initiated a class action lawsuit in federal court in New York accusing DraftKings of illegally sharing users’ personally identifiable information (PII) with third parties through Facebook pixel tracking technology.
Additionally during that month, Texas resident Eric Avila filed a class action complaint in the U.S. District Court for Massachusetts alleging that DraftKings fraudulently closed user accounts and withheld remaining funds, including his own balance.
In April 2025, Baltimore commenced legal action against both DraftKings and FanDuel for engaging in "deceptive and unfair practices" targeting vulnerable gamblers, violating the city’s Consumer Protection Ordinance. The following month, a Pennsylvania-based class action lawsuit accused DraftKings of deceptive marketing tactics and predatory advertising behavior.
These ongoing legal proceedings present considerable challenges to DraftKings’ reputation and financial stability as it contends with increasing regulatory scrutiny across its international operations.