The chief executive of fantasy sports operator FanDuel has said that a stock market flotation could be on the cards for the firm after its merger with rival DraftKings.
Nigel Eccles, who co-founded the business in Edinburgh, told Scotland on Sunday that an initial public offering (IPO) for the combined group is “certainly a possibility” once the tie-up is completed.
He said: “In the short term, the real focus is on getting the merger through, getting the integration completed and building a phenomenal business. As we do that, we’ll then turn to thinking whether [an IPO] is the right path to go down. The merger makes it a very substantial business and one that could go public.”
FanDuel, a so-called technology “unicorn” valued at more than $1 billion, is now headquartered in New York but has about 150 people across its offices in Edinburgh and Glasgow. It lets players build virtual teams of professionals from the fields of American football, baseball, basketball and hockey, with winnings paid out depending on performance, and has faced legal and regulatory hurdles, with some states insisting its daily competitions amount to gambling.
The company launched its offering in the UK last year, targeting fans of the English Premier League.
Speaking from Boston, Eccles said the name for the combined entity is yet to be decided. “We’ve got two incredibly well-known brands – both FanDuel and DraftKings have brand recognition close to 90 per cent among sports fans in America – so we’re trying to figure out whether we major on one brand or the other,” he said.
In his first wide-ranging interview since the DraftKings merger was announced in November, Eccles said the deal is expected to be completed by the end of this year, subject to regulatory approval. He will become chairman of the business, with DraftKings boss Jason Robins becoming chief executive.
Eccles relocated to the US in September. His wife Lesley – with whom he co-founded FanDuel alongside Tom Griffiths, Rob Jones and Chris Stafford – was previously executive vice-president for marketing and moved to a non-executive board role in the summer, but still has a focus on the marketing side of the business.
Asked whether the tie-up with DraftKings would affect the firm’s headcount, Eccles said: “Mergers in mature industries are often about taking costs out, but that is certainly not the case here. We’re merging to get scale and the combined companies will have about 300 people in product development, including engineering, and that’s a number I want to grow. Given that we have such a strong engineering base in Scotland and there’s such a talent pool there I want to grow it in Scotland as well.”