Walt Disney is getting in on the online fantasy sports business, investing $250 million in DraftKings, a Boston-based start up site, where fans can play fantasy sports with real money on a per-game basis without having to commit to an entire season.
DraftKings is one of the country’s biggest daily fantasy sports companies, with more than 1 million users.
Last year, the site earned more than $300 million in entry fees, up from $45 million in 2013. A big part of the fees is put back into prize payouts, which according to DraftKings will total $1 billion this year.
FanDuel, a competing site, will be allowed to continue to advertise on ESPN but won’t have the premium positions given to DraftKings, according to WSJ.
Previous investors for DraftKings include The Raine Group, Redpoint Ventures, GGV Capital and Atlas Venture.
DraftKings will offer daily and weekly cash prizes contests covering all major sports.
Betting on sports has long been a hot topic, and while there is uncertainty as to whether sites like DraftKings constitute gambling, NBA commissioner Adam Silver has voiced increasing tolerance. “If it’s done in a sort of moderate way and it’s not over the top and it’s relatively small amounts of money, it adds to the excitement and interest in the sport,” he said, according to CSNNE.com.