DraftKings Adding NFT Exchange in First Major Push Beyond Gaming
DraftKings is launching its first non-gaming vertical, an NFT marketplace where its users will be able to buy, sell and trade digital collectibles with the same funds they use to place bets or play blackjack.
DraftKings Marketplace will launch later this summer, starting with a partnership with Autograph, the digital collectible company co-founded by Tom Brady. DraftKings will be the exclusive distributor of sports NFTs from Autograph, which has deals with Tiger Woods, Wayne Gretzky, Naomi Osaka and Derek Jeter, and plans to work with other NFT companies in the future.
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The marketplace will be integrated into the existing DraftKings app and will initially operate solely in U.S. dollars, a departure from most NFT exchanges, which typically do sales on the blockchain in cryptocurrency.
The news is particularly noteworthy because of what it might mean for the future of DraftKings’ business. Once strictly a daily fantasy operator, the company has already branched out into sports betting and online casino games, and is now starting to look further afield for new business opportunities.
“Over the last year, what’s become very apparent is that the same customer that we’ve attracted for sports betting or fantasy, a decent chunk of their time is going towards other hobbies that are very aligned with their interests, whether that’s crypto, day-trading or collectibles,” DraftKings co-founder and president Matt Kalish said in an interview. “And not just physical collectibles like sports cards, but our users are the early adopters in digital collectibles like NFT projects.”
Media is another obvious area of expansion—DraftKings recently bought the rights to distribute Dan Le Batard’s podcast—but a marketplace function could open the door for other DraftKings verticals, anything from tickets to apparel or non-digital memorabilia. Kalish declined to comment on any specific future avenues under consideration.
This is a trend happening across the industry as the lines between e-commerce, media and gambling continue to blur. The people who bet on games are usually the same people who watch the games, buy the merchandise and collect the memorabilia, so companies that attract a lot of users through one of those avenues are looking for ways to monetize the audience elsewhere. Fanatics, for example, the dominant seller of licensed sports apparel, is starting to branch into memorabilia and NFTs, and just hired a new executive to explore other verticals.
“Marketplaces inherently benefit from having a lot of eyeballs on them, and DraftKings finds this opportunity very appealing because of the amount of eyeballs that we have,” Kalish said.
Brady and Dillon Rosenblatt co-founded Autograph earlier this year as the NFT craze reached an early zenith. The company works with celebrities and brands across sports and entertainment, and on Wednesday announced deals with Jeter, Gretzky, Osaka, Woods and Tony Hawk (all of whom are joining the company’s advisory board).
This deal further deepens preexisting business relationships between the two companies. DraftKings co-founders Jason Robins, Paul Liberman and Kalish are all Autograph investors and advisers. Richard Rosenblatt, Dillon’s father, is on the DraftKings board.
While this will start with sports, the collaboration could eventually expand into other areas. Autograph also recently partnered with Lionsgate to create digital collectibles based off of the company’s movie and TV franchises.
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