FanDuel Chief Executive to Stand Down
FanDuel has announced that chief executive Matt King is stepping down after four years in the role. King replaced company founder Nigel Eccles after the government blocked a proposed merger with DraftKings in 2017. Irish gambling giant Paddy Power Betfair then swooped in to buy FanDuel after the Supreme Court overturned a federal sports wagering ban the following year. King has since overseen FanDuel’s transformation from a daily fantasy sports provider to the most popular online sportsbook in the United States.
He said he is looking forward to new opportunities, but pledged to remain in the role until a successor is found. “"It has been a privilege to lead FanDuel over the last four years through what has been an incredibly exciting period for the company,” said King in a statement. “With FanDuel well positioned for the next chapter of its growth and always an entrepreneur at heart, now is the time for me to take on new opportunities as the next step in my career.” He added that he is confident the business “will continue to go from strength to strength” in the years ahead.
Paddy Power Betfair has since rebranded as Flutter Entertainment and purchased The Stars Group to form the world’s largest online gambling company. Flutter chief executive Peter Jackson said: "I would like to take this opportunity to thank Matt for his considerable contribution in helping to make FanDuel the US market leader it is today. FanDuel has achieved so much in the three years since PASPA was repealed and that is due in no small part to Matt’s leadership and the strong team built around him. While we will be sorry to see him leave, he leaves the business in great shape. We are starting the process of looking for a new CEO for FanDuel and we remain focused on maintaining our leadership position in the US market.”
Departure Disrupts IPO Plans
The timing of King’s departure could be viewed as unfortunate for Flutter. It was exploring the benefits of listing a small stake of the FanDuel subsidiary, as it currently looks undervalued compared to DraftKings. “As previously announced, the Flutter board has been assessing the potential merits of listing a small stake in FanDuel in the US,” said the firm in a statement. “Whilst Matt's departure will affect the timing of any potential US listing, the Board will continue to keep this option under review.”
Flutter Entertainment’s share price has decreased by around 13% this week. Global equities have been dicey, but news of King’s impending departure has undoubtedly played a role in causing the depreciation. However, the Dublin-based, London-listed company saw revenue increase 32% year-on-year to £1.49 billion ($2.1 billion) in the first quarter of 2021, and average monthly customers increased to 7.7 million, so there should still be plenty of cause for optimism among shareholders.
Tennessee Smashes Through $1bn Barrier
FanDuel was one of the first online sports betting brands to go live in Tennessee when the state rolled out its legal sports wagering industry in November 2020. DraftKings and BetMGM also launched standalone apps in the Volunteer State, while William Hill, WynnBet and TwinSpires have since joined the party. Tennessee has now become the quickest state to break through the $1 billion sports wagering handle barrier.
In the first six months, sportsbooks accepted $1,077,844,523 in wagers. Tennessee Lottery chief executive Rebecca Hargrove confirmed the milestone in a presentation to the Sports Wagering Advisory Council this week. No state has reached $1 billion in wagers in a quicker timeframe. The closest was New Jersey – now the market leader in the United States – which took $928,134,172 in its first six months. The gross sports betting revenue in Tennessee is $172 million since November.
It means that the state has now received more than $18 million in taxes from sports betting. Eighty percent is ploughed into an education fund that predominantly funds postsecondary scholarships. A further 15% goes toward local government needs and 5% funds gambling problem treatment programs.
In April, Tennessee sportsbooks took $172.4 million in sports bets. That was down 13.6% compared to March, which was to be expected, as the overall U.S. sports betting handle generally spikes in March due to the NCAA men’s basketball tournament. The state earned $2.8 million in taxes during April.
Indiana Handle Dips and Illinois Seizes Third Place
Indiana also suffered a March Madness hangover in April. The state reported a handle of $236.4 million for the month, which was down 25% compared to the previous month. Once again, that was to be expected, as Indiana hosted the entire NCAA men’s basketball tournament and it generated a great deal of excitement in the state.
Operators earned $20.1 million in gross revenue, which equates to a hold of 8.5%, according to a report from the Indiana Gaming Commission. Ameristar East Chicago, which hosts DraftKings and TheScore, led the way with a handle of $87.6 million. Blue Chip Casino, host of FanDuel, came second with $67.1 million in online sports wagers. It means that Indiana could be one state in which DraftKings is ahead of FanDuel. BetMGM was third, with PointsBet a distant fourth.
It means the state has recorded a handle of $1 billion for the first four months of 2021. Elsewhere, Illinois has reported its March figures. The state is typically the last to report handle and revenue, but it has now revealed that total handle hit $633.6 million in March. It marks the first time that the state’s monthly handle has gone past the $600 million mark. Revenue hit $44.3 million, according to a report from the Illinois Gaming Board, which amounts to a 7% hold.
Illinois nearly overtook Nevada in March. The Silver State took $640.8 million that month, its third best performance in the post-PASPA era, so Illinois was just $7.2 million short of flipping it. Pennsylvania only took $560.3 million, so Illinois is now the third largest sports betting market in the country, although it needs to grow significantly in order to topple New Jersey. DraftKings took an early lead in Illinois, but that is now being eroded. Its share fell from 42.3% of the market in February to 33.4% in March, whereas FanDuel increased from 30.1% to 32%. Local operator BetRivers – the first online sportsbook to launch in the state – is also seeing its share fall, with Barstool Sportsbook seizing market share.