Although some believe there is a debate to be had about who is the greatest NBA player of all time, the large majority will say that Michael Jordan is number one. What cannot be argued is that MJ had more of an impact on the sport and the commercial side of the game than anyone before him. From early in his career, Jordan understood the mechanics of finance and marketing in the game.
It would appear that despite having long been retired, MJ knows a smart investment when he sees one; that is why he has just bought an equity stake in DraftKings. This is the biggest mobile sports betting company in the country and to have MJ on their team is a real coup. The NBA legend and owner of the Charlotte Hornets could play a pivotal role in the gambling company.
Jordan Doubling Down On His Status
Jordan, even in retirement, is very rarely out of the news. His own stock has risen since the Netflix special The Last Dance was aired. This introduced Jordan to a new generation and reinforced his legendary status. Jordan’s arrival to the board of DraftKings will see a mutually beneficial deal whereby he gets to jump onto the hottest company in the game. In return, DraftKings will get a man who knows marketing and sports like few others.
Reasons to Buy a Stake in DraftKings For MJ
Since its arrival on the scene in 2012, DraftKings has catapulted itself to the top of the mobile betting industry. This company primed itself for the legalization of mobile betting through the initial creation of a fantasy sports app. This placed the company front and center so that, when the green light for mobile betting was given in states across the US, DraftKings pounced.
In April of this year, DraftKings became a publicly-traded company. They are currently worth around $12B. To buy a stake in DraftKings is a shrewd move by MJ which will likely prove to be very valuable indeed.
The DraftKings stock price is a hot topic of conversation. Just last month we reported why it was a good time to buy stock in the company. There is some debate as to whether or not the valuation of the company is accurate, owing to a number of mergers; we talk about that in this piece. Nonetheless, what nobody can deny is the heavyweight nature of this company and that this is a deal that benefits all involved.
What Will Be The Nature Of The Deal?
Michael’s purchase of an equity stake in DraftKings puts him on the board of one of the planet’s most successful betting firms. What’s in it for DraftKings? The company will certainly benefit from the marketing this move brings. We have seen time and time again how bullish a famous name on the board can be on advertising. Our piece here talks about how hard DraftKings has gone on sports ads of late. This move, however, will offer much more for DraftKings.
CEO Jason Robins released the following statement regarding Jordan’s stake in DraftKings:
“Michael Jordan is among the most important figures in sports and culture, who forever redefined the modern athlete and entrepreneur… The strategic counsel and business acumen Michael brings to our board is invaluable, and I am excited to have him join our team.”
How The Market Reacted To The Deal
The DraftKings stock price is very sensitive when it comes to announcements from the company and this one was no different. Following the announcement of Michael Jordan’s purchase the stock rose twelve percent in less than twenty four hours. Following this news which we broke around DraftKings’ first NFL multi-state competition, we saw a rise in the stock price of around 6%.
This sensitivity of the stock price makes moves like this one worthwhile and DraftKings knows that well. The higher the stock price, the higher the value of the company, and this business is on its way to the moon. This is surely why Michael Jordan wanted to get a stake in DraftKings. There is little doubt that this will be a long-standing, mutually beneficial arrangement.