Daily fantasy sports providers are following in the footsteps of legal sports betting operators.
Several fantasy sports gaming platforms, including Underdog Fantasy and PrizePicks, are making investments toward responsible gaming initiatives following a slew of online betting sites taking steps to hinder problem gambling. Earlier this week, Underdog launched GuardDog — a responsible gaming innovation fund — with $1 million in initial funding. Underdog has pledged to use the fresh capital to bolster early-stage startups that aim to address problem gaming.
“At Underdog, we always look to adopt best in class and then innovate further. With GuardDog, we intend to spur innovation to help companies that help people play the games they love — including all our games on Underdog responsibly,” said Underdog founder Jeremy Levine.
The company has also taken additional steps to enhance its leadership as it commits to responsible gaming. Underdog recently hired Adam Warrington as a consultant to improve the company’s responsible gaming program. Warrington brings a wealth of experience to the New York-based company after serving as the vice president of responsible gaming at FanDuel.
Underdog, primarily known for its fantasy sports product, recently established a presence in the growing sports betting market. In October 2022, Underdog secured its first temporary wagering license in Colorado — marking the company’s first foray into a global sports betting market that is projected to be valued at $167.5 billion by 2030, according to Vantage Market Research.
Underdog’s decision to apply for a temporary sports betting license in the Centennial State came after a $35 million Series B funding round in 2022, which valued the company at $485 million. The round included Dallas Mavericks owner Mark Cuban and NBA star Kevin Durant.
Growing trend
Underdog has joined a fellow competitor in advocating for responsible gaming in fantasy sports.
On Tuesday, PrizePicks announced a strategic partnership with U.S. Integrity — a sports wagering monitoring company. The deal will see PrizePicks leverage ProhiBet, which monitors illicit betting activity. ProhiBet is a joint venture between U.S. Integrity and Odds on Compliance.
Odds on Compliance — a consultancy firm that specializes in online gaming — will be merging with U.S. Integrity by the end of October depending on shareholder and regulatory approval.
Under Watch
Daily fantasy sports providers are also facing scrutiny as the sports betting industry matures.
Gaming regulators in several states, including Michigan and Florida, have taken steps to ban pick ‘em-style fantasy sports contests as they resemble player props at traditional sportsbooks. Operators of fantasy sports have deemed their products legal amid the ongoing crackdown. Local authorities across the U.S. will continue to debate the validity of pick ‘em-style contests.
