Underdog's Valuation Soars: Billion Dollar Milestone

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00:00All right, so now let's get into some good news in that space, and that has to be from the company

00:05Underdog. There was a report that I read over at Legal Sports Report that their valuation is

00:10significantly above what it was last season. What do you attribute this to?

00:16Yeah, they're now valued at over a billion dollars, which is huge news for a company that

00:20only a couple of years ago was valued at about 400 million. It was a startup based out of Brooklyn

00:25launching Daily Fantasy Sports Technology. We talked about pretty much all last year how states

00:31took action against their Pick'em games, which they identified as parlays. To Underdog's credit,

00:36they took the necessary steps of working with regulators to figure out how to satisfy those

00:41concerns. But what I would contribute their huge valuation bump, essentially, they figured out how

00:48to stay relevant and how to keep offering those same games despite the blowback from the industry,

00:53despite companies like Fandle and DraftKings taking legislative and lobbying action against

00:59them, trying to get them cracked down on. They kind of came out of that okay. They went through

01:03the battles tested. They're in a lot of states where sports betting isn't legal, but offer a

01:07product very similar. You can do the Pick'em, you take over and unders on various players,

01:12and they seem to be doing a really good job of it. They just left New York. Part of leaving New

01:18York was agreeing to pay $17 million, which is based off the revenue they made there,

01:23which is pretty significant for a state that does have sports betting. It shows that

01:27people were still in that state with that option and still going over to this fantasy sports

01:30provider. They're only seeking to grow. They're trying to become a sports book. Eventually,

01:35they're going to be competing for a license in Missouri. Once that launches, they already have

01:38the North Carolina license. So they're really growing their brand based off of this daily

01:43fantasy sports model that they already pushed out there. Now they're kind of in this phase two.

01:47And another thing I'll note about this valuation is it comes off of an investment from the venture

01:52capital firm Spark Capital, which is known for investing in huge names like Twitter, Discord,

01:58and Slack. And it marks the largest single investment ever from a venture capital firm

02:03into a sports gambling company. So huge news for Underdog. Their company is really growing,

02:08and they have their sights set on growing even more as we go into the year.