DraftKings co-founder and CEO Jason Robins recently revealed that his long-term plans for the company include all types of gambling, going well beyond just sports betting. Eventually, Robins envisions a company comparable to and valued the same as major tech companies, such as Alphabet, Amazon, Facebook, and Apple.
Robins also acknowledged that increased tax revenue will be a focus for US states, driving more states to legalize sports betting to bolster their upcoming budgets.
DraftKings Strategy is Eye-Opening
In a recent interview, Robins said he is happy to have begun the trend in the special purpose acquisition companies market on Wall Street; the DraftKings online sportsbook made its debut as a $3 billion company, quickly gaining a market valuation of more than $12 billion. However, Robins also added that he thought that market could be overheating, and that it is not a good fit for every investor.
Special purpose acquisition companies are very popular on Wall Street right now, and it’s obvious the trend has a lot to do with the massive success of DraftKings. While growth companies such as DraftKings usually avoid SPACs, DraftKings’s success has been an eye-opener for executives, entrepreneurs, and investors, proving there’s a new way to go public.
Expanding Sports Betting Nationwide
Robins further pointed out that sports betting is just the beginning of DraftKings‘ plan to be the go-to place for all types of gambling. The company is now live in nine states for online sports betting, recently going live in Illinois.
With brick and mortar sportsbooks in two more states, New York and Mississippi, the DraftKings CEO notes that Virginia, Tennessee, and Michigan have already passed sports betting legislation and are in the process of finalizing the regulations. DraftKings will pursue a gambling license in those states, as soon as possible.
“We’re hopeful that those three states will not be too far off in the future. I’m hoping that many more states will go ahead and legalize sports betting,” Robins said.
He went on to say, “There are many good arguments to legalize sports betting. Currently, there’s a massive illegal market operating in an unregulated realm, with no tax revenue generated for the states. I think right now, tax revenue will be even more of an issue for states after some of the recent challenges. I know there are a lot of state budgets that are hurting.”
“We feel like DraftKings is willing to be taxed, and we’re ready to go,” said Robins. “Hopefully, that’s an attractive proposition for many states as they consider their upcoming budgets.”
DraftKings Partners With Hollywood Casino
The online sports betting giant expanded it’s operations last May, when it partnered with Hollywood Casino, an affiliate of Penn National Gaming. The deal made casino games available on the DraftKings sports betting app in the states of New Jersey and Pennsylvania. Players in those states can easily access slot games, blackjack, roulette, and three-card poker from the sportsbook app or a standalone casino app.
DraftKings is also planning to launch live casino games through a partnership with Evolution Gaming, a global provider of live, online casinos.
DraftKings, along with its rival FanDuel, decided to offer online casino games to open up an entirely new market, going beyond the young male, sports fan demographic.
Creating a standalone casino app for its casino audience makes it easier for its customers to find what they’re looking for, as well as reducing bloat on the apps. However, both the casino and sportsbook apps share a wallet.
It looks like DraftKings is well on its way to a nicely diversified offering of gaming products, and as more states legalize both sports betting and online casinos, the company is well-positioned to profit.