In August 2014, Boston-based daily fantasy sports startup DraftKings acquired Boston-based daily fantasy sports startup StarStreet for an undisclosed amount.
“If we were going to reinvent the space and build a product that is what daily fantasy sports should be, could we do that? When you ask people, ‘What do you enjoy most about your season long league?’ People say, ‘The draft, of course.’ The rest of the season-waiver wire and managing your lineups-is kind of annoying. The draft is what’s fun.”
Whereas DraftKings, FanDuel, Yahoo Daily Fantasy and others function using an imaginary salary cap, Draft puts users in a snake draft, with no salary cap.
The regulatory heat on daily fantasy sports has created “Challenging times,” Draft founder Jeremy Levine says, “But not everyone’s dead. We’ve been growing quite a lot this season. I think there’s a huge future for daily fantasy, just maybe not in the same exact incarnation it was before.”
“They’ve educated the market everyone now knows what daily fantasy is.” But he adds that if you asked season-long fantasy sports players one year ago whether they believe they could win money playing daily fantasy, “I think 80% of them would have said yes. But if you ask them now, I think only 10% would say yes. I think everyone has learned how hard it is to win on DraftKings and FanDuel. And that has opened the door for us.”
To be sure, DraftKings and FanDuel are much larger than their closest competitor, Yahoo Daily Fantasy, and all three are much larger than Draft.
Draft thinks it can be the last man standing in daily fantasy by emphasizing fun, and emphasizing parity.