PrizePicks is a daily fantasy sports (DFS) operator that has essentially flown under most radars until now. It is now looking to make a splash in the sports gambling industry and the timing could be good, provided the major sports organizations in the U.S. can get going. A number of investors apparently agree, as the company just wrapped up a round of funding that saw it collect $850,000 to help its expansion, and which attracted interest from one of the most well-known names in poker, Phil Hellmuth.
The funding round was led by Parlay Capital Holdings and saw participation from AMJ Ventures and the 15-time World Series of Poker winner known by many as the Poker Brat. Hellmuth, who didn’t specify how much he invested, said of his decision to get involved, “I absolutely love the core business model of PrizePicks and the team behind the game. I’ve been around this industry for decades, and I’ve never been more impressed with an emerging operator’s fundamentals and potential for growth.”
While commercial endeavors of all types are suffering from the coronavirus pandemic, sports gambling and related activity have been able to figure out how to keep their heads above water. DraftKings recently went public and has had substantial success ever since. From a March low of $11.17, it is now trading at $33.10, and investors have to be pleased with the results.
PrizePicks first started to emerge in 2014 as the SidePrize alternative product, which allowed fantasy league members to offer skill-based side bets. There were some initial issues, thanks to the close-minded attitude of New York lawmakers, and changes to the operational model were needed. That led to the eventual launch of PrizePicks in 2018, which has been building up steam ever since.
The company bills itself as the “only DFS operator to offer mixed-sport entries” that allow users to wager against projections, instead of against each other. It is now part of a select group of domestic pure-play sports gambling operators in the U.S. and likes its odds of success ahead of the upcoming NFL season, with the latest investment round just a part of the company’s overall plan to attract more capital as it seeks to expand.
CEO and founder Adam Wexler says of the just-completed investment round, “While this bridge raise was done in response to the current pandemic, it allowed us to check some boxes regarding a well-rounded cap table. Securing investors like the world’s most accomplished poker player proves we’re onto something big.”