Exclusive: Disney in early talks to back Draft Kings at unicorn valuation
Draft Kings, a daily fantasy sports site through which users can legally wager real money, is in the midst of raising a new round of venture capital funding at a valuation of at least $1 billion, Fortune has learned. Among those in talks to invest is Walt Disney Co. (DIS), whose properties include ESPN.
Both Disney and Draft Kings declined to comment.
Other strategic players also may be involved, although the most logical candidates — Yahoo Inc. (YHOO) — is not expected to be involved.
This would be the third round of funding within the past year for Boston-based Draft Kings, including a $41 million Series C round last summer and a subsequent (and undisclosed) investment from Wellington Management). Overall it has raised in excess of $80 million, from firms like Wellington, Atlas Venture, GGV Capital, Redpoint Ventures and The Raine Group.
Much of that money is earmarked for marketing, as Draft Kings is locked in a costly customer acquisition battle with rival Fan Duel (which also is in in market with a new round that could put it in the unicorn club). Fan Duel investors include both Comcast Ventures and NBC Sports Ventures.
On its website, Draft Kings guarantees that it will pay out more than $1 billion in prizes this year.
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