$7,000,000 to Keep Pushing the Envelope: Interview with DraftKings CEO Jason Robins
It’s hard to believe DraftKings has only been around for one year. The startup launched during the 2012 baseball season and won over the Grinders community with an aggressive Overlay strategy. They carried this fearless strategy over into NFL season, overlaying dozens of tournaments in their $1,000,000 Chase for the Crown series. DraftKings kept their foot on the gas with the $5,000,000 Chase for the Crown 2 for MLB.
This aggressive promotion was all done with an initial $1,500,000 capital raise. On Monday DraftKings announced an enormous $7,000,000 Series A Round led by Atlas Ventures (read about it on Forbes). Considering what DK accomplished with the first $1.5mm in only one year, daily fantasy players should rejoice. Huge things are ahead for DraftKings and daily fantasy.
DraftKings CEO Jason Robins is the main driver behind this disruptive daily fantasy force. His strategies have DK gobbling up market share despite launching over a year later than the other big players in the industry. I’ve been a big fan of Jason’s since my first calls with him, mainly because of his fearless marketing strategies, his ability to secure VC capital out of the gates, and his team’s prior online customer acquisition experience. In his previous life he was an executive at VistaPrint. He’s exactly the kind of leader this industry needs. I sent a few questions his way to get some insight on his plans with this influx of capital.
Interview with DraftKings CEO Jason Robins
Cal: Tell us about the early days at DraftKings. Was it difficult to convince your investors that spending cash in tournament overlay would be a good customer acquisition strategy?
Jason: Our investors have been incredibly supportive and understand the tremendous opportunity present in DFS. With so many other great sites out there, they also understood that it was important to push the envelope, and being aligned on philosophy with the people backing us has been a critical part of our growth. They have also constantly pushed me and the team on quality of product and user experience, and that has also been a big part of our focus. I know we still have a lot of work ahead of us, but with only one year under our belts, I do think we have gotten a lot accomplished there. Getting people to try you out is one thing, but quality of experience is what makes them stick with you over the long run.
Cal: What is your background in corporate America and how did it help you build the DraftKings team?
Jason: Both I and my co-founders, Matt and Paul, have a background built around data and analytics. We use it in everything we do, from the marketing tactics to the product, gameplay, and user interface. There isn’t a thing we don’t look at when it comes to data. Outside of corporate America, I have been an avid fantasy sports player for most of my life. I love games of all types, but fantasy sports has always been my favorite.
Cal: Which was more difficult, the initial $1.5mm raise or this $7mm raise? Any interesting stories come out of it?
Jason: Both were really tough. Getting rejected is hard, but even harder is when someone wants to back you but only under the condition that you do things differently than the way you believe is right. Raising money from the right people is just as important as raising money itself. One investor we talked to told us they’d back us if we were willing to switch to a subscription model.
Cal: What are your marketing plans with this new round of capital? What new doors will it open? Will we see DraftKings TV commercials soon?
Jason: We have lots in the works, though so much focus has been on raising the capital that we haven’t really spent much time yet figuring out what we will do with it. We do intend to do a decent amount of marketing, but we also want to make sure we hire some great product and engineering talent to continue enhancing the gameplay and user experience. Marketing is important but that part is just as important, and we know there is still a lot of work to do there.
Cal: What are the key factors that will drive the growth of daily games? Do you have plans to make daily games on DraftKings more accessible to the casual fan?
Jason: I think you are 100% right that making daily fantasy sports as accessible as possible to the casual fan is critical. Beyond that, I think it comes down to doing enough marketing to get people to try it out and then making sure you do everything you can to give them a great experience so they want to come back.
Cal: How many employees do you have currently? How many do you plan to add after this round of capital?
Jason: We currently have just under 20 employees. We are planning to add a dozen or so more by end of year.
Cal: You’ll probably want to keep it under wraps, but what can you tell us about your plans for NFL 2013?
Jason: I honestly don’t even know! Our marketing team has been working on some exciting things for NFL 2013 but they haven’t shown me anything yet.
Cal: How long will it be before we see the first $1,000,000 first place prize in a daily fantasy event?
Jason: That would certainly be huge, but my guess is that it’s still a year or two away.
Cal: Huge congrats on closing this round and thank you for taking the time for this interview! The entire daily fantasy community appreciates what you’re doing. Keep on pushing that envelope!
Jason: Thanks, and I really appreciate all the support that we have gotten from the Grinders community! Having a strong community is also a key part of what will make the DFS industry grow, and we can’t thank you guys enough for all the feedback – positive and negative – you have given us.