DraftKings backs new VC agency amid rise in sports activities startups – The Boston Globe

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DraftKings backs new VC agency amid rise in sports activities startups – The Boston Globe



The brand new enterprise capital agency, known as Drive by DraftKings, has a community of advisors who will supply recommendation and connections to firms as soon as Drive has made an funding. That group contains former Boston Crimson Sox normal supervisor Theo Epstein, Olympic hockey gold medalist Hilary Knight, former Arizona Cardinals receiver Larry Fitzgerald, and YouTube gamer Elliott Watkins, amongst others. Drive says that the majority of these advisors put cash into the brand new fund.Additionally supporting Drive are Boston Seed Capital, Confederate, and Common Catalyst, three native VC corporations.When first launched in 2019, the Drive initiative had a special focus; it aimed to offer entrepreneurship coaching for present and former professional athletes, and likewise speed up the progress of entrepreneurs who’d already began sports-related firms, by serving to make introductions.Meredith McPherron, employed in mid-2020 as Drive’s CEO, says the entity explored a number of totally different concepts earlier than deciding to give attention to investing. Whereas a number of the cash within the Drive fund comes from DraftKings, McPherron says that Drive has been set as much as be unbiased. It’ll spend money on startups from the earliest “seed” stage by the purpose once they have created a product and are producing income. Her investing companion is Kiki Mills Johnston, a former managing director of the MassChallenge startup program in Boston.McPherron, a Harvard-trained startup advisor and investor, says the brand new agency will again firms constructing companies in “sports activities and gaming, media and fan engagement, human efficiency, and knowledge analytics and monetization.” It has already invested in 13 startups, together with Whoop, a Boston firm that makes a wearable health monitor, and Simply Ladies’s Sports activities, a media web site headquartered in Los Angeles.Drive joins a minimum of two different native enterprise capital corporations that largely give attention to investing in sports activities: Causeway Media Companions, co-founded by Boston Celtics proprietor Wyc Grousbeck, and Will Ventures, co-founded by Isaiah Kacyvenski, a former linebacker for Harvard School and the NFL’s Seattle Seahawks.Kacyvenski says the creation of Drive is “an excellent further sign,” exhibiting that sports activities startups are now not perceived to be chasing a glamourous, however area of interest, market. He mentions firms like Peloton, Barstool Sports activities, FanDuel, and DraftKings as examples of companies which have attracted mainstream clients. He provides that extra gamers, coaches, and crew homeowners are getting energetic in startup investing; for instance, his agency, which raised a $55 million fund final September, collected cash from the homeowners of 9 skilled sports activities franchises.Peter Blacklow, a companion at Boston Seed Capital, was among the many earliest buyers in DraftKings. He says he doesn’t suppose the world of sports activities startups is overheated or over-funded.“New knowledge and wagering alternatives have created seismic modifications within the sports activities enterprise world,” Blacklow says, “and we’re simply seeing the start [of changes] in how followers work together with sports activities, groups, and gamers.”Different current developments, like the flexibility for school athletes to revenue from their title and picture, legalized sports activities betting, at-home health know-how, and the rise of streaming video suppliers have additionally cracked open new alternatives for startups, in line with Jordan Fliegel, managing director of the Techstars Sports activities Accelerator, a startup investing initiative that has backing from the Indianapolis Colts and Pacers.One of many co-founders of Causeway Media Companions, Bob Higgins, acquired his begin in enterprise capital in 1982. He says the alternatives he sees in sports activities and health proper now are “nearly like Eighties enterprise capital. There are numerous fascinating issues happening, but it surely’s not overwhelmed with capital.”When DraftKings was getting began, in early 2012, there have been no VC corporations on the town that specialised in sports activities startups. In lower than a decade, that has modified — and now there are a number of doorways for entrepreneurs to knock on.Scott Kirsner might be reached at [email protected] Comply with him on Twitter @ScottKirsner.



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