DraftKings is in the final stages of hiring a chief media officer who will manage a team responsible for evaluating potential media acquisitions and content efforts, sources tell Axios.
Details: The team will help vet future deals and content partnerships that the company will use to help drive customer referrals to its sportsbook.
- DraftKings has talked about a potential deal with Action Network, the digital sports betting publisher, two sources familiar with the conversations tell Axios.
- Action Network, which sources say is profitable, has been approached by several sportsbooks about a deal. One source says that the sale process for the venture-backed company has accelerated in recent weeks, given the momentum around the betting market.
Driving the news: DraftKings two weeks ago announced the acquisition of VSiN (Vegas Stats & Information Network), a sports betting television and streaming channel. VSiN, sources say, is the catalyst for more deals to come.
- A source familiar with the transaction says the deal was valued around $100 million, mostly in stock.
How it works: For sportsbook operators like DraftKings, as well as rival FanDuel and casinos like MGM, Caesars and Wynn, owning content could be a cheaper long-term vehicle than paid marketing for accruing customers.
- DraftKings spent $475 million on sales and marketing last year. The company has reported 1.5 million monthly unique paying customers.
Between the lines: Most sportsbooks have already begun striking partnerships with media companies, but the deal frenzy is just getting started.
- DraftKings inked several high-profile deals with sports publishers over the past few years to test the waters around content before starting to build its own operation. The most notable partnership has been with Bleacher Report, long been rumored as a potential acquisition target for the company.
- Sources say Bleacher Report parent Turner Sports has no plans to sell Bleacher Report at this moment.
The big picture: Sports betting has helped to boost dozens of small sports media upstarts that are ripe for future acquisitions.
- Companies often noted as potential acquisition targets include Blue Wire Podcasts, Front Office Sports, Wave.TV, Overtime, OutKick Media and SportsGrid.
"Leading operators, in addition to DraftKings, such as FanDuel, BetMGM, Caesars, WynnBet, PointsBet and more…they're all looking at (media) assets," says David VanEgmond, Founder & CEO Bettor Capital, an investment fund.
- "There are a lot of emerging digital media assets, in the $50-250+ million equity range, that are likely acquisition targets of the operators to own more media content and subsequently lower their cost of customer acquisition as opposed to buying advertising," VanEgmond adds.
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