- Mike Segar/Reuters
Since July 2015, DraftKings has attracted more than $520 million from outside investors – nearly all of the $600 million it’s raised since it got its start in 2013.
The fantasy sports site’s CEO, Jason Robins, now credits one major change to his fundraising strategy for the flood of cash the company was able to raise: pre-qualifying investors.
Robins realized he had been spending a lot of time in investor meetings, even when the investor had no real interest in the company.
“They’ll just take the meeting and no one wants to say no,” Robins said.
Before he flew out to Silicon Valley to fundraise, the NYC-based CEO started sending emails to venture capitalists and made sure to ask if they were interested in investing in the company, not just asking to meet up.
“I did it thinking I was traveling, in retrospect, I should have done it that way before with my east coast meetings too,” Robins said.
What he ended up with was what he calls a “qualified pipeline” – people who would both be assets to the company and have already expressed an interest in investing in DraftKings, a company that’s had buckets of trouble when it comes to regulation and may not be an investment target for everyone.
By pre-qualifying investors, he was able to concentrate his efforts and run his fundraising process even faster.
And the results speak for themselves. In the last 18 months, DraftKings closed a $300 million round in July 2015, an additional $70 million in February 2016, and another $150 million in September.