A shared enemy happened.
Rival fantasy sports sites DraftKings and FanDuel announced a long-expected merger on Friday.
It’s a deal that makes a lot of sense on paper: The two companies offer near-identical products, are fighting the same regulatory battles and can now spend time and resources building one business together instead of trying to tear each other’s businesses apart.
But it’s not a secret in the industry that DraftKings CEO Jason Robins and FanDuel CEO Nigel Eccles — not to mention their investors — don’t get along either publicly or privately. At least, they didn’t get along for the better part of the past two years. Now Robins is CEO of the new joint entity and Eccles is chairman, which means the two will be working together closely.
Is this relationship going to work?
“I think what I’ve said publicly about Jason is probably no worse than what I’ve said about my fantasy football buddies,” Eccles joked to Recode Friday in a joint interview with Robins. “We’re both entrepreneurs, we’ve both had visions of transforming this industry, so I think often when you’re a competitor you lose sight of that.”
“To steal a sports analogy, you might have two players on opposite sides of the field that are very much friends and know each other well off the field,” Robins said. “I think Nigel and I always got along. We felt like we could always go grab a beer together, go grab dinner, and we’ve done that many many times.”
Sounds like the hatchet has been buried, at least publicly.
But while Robins has long called for a merger between the two sites, Eccles repeatedly said publicly that he wasn’t interested. He told my colleague Peter Kafka twice this year, as recently as May, that he didn’t see the need for a tie-up.
Ultimately, the two companies realized they were actually fighting the same opponent: Regulators labeling their pay-to-play fantasy businesses as illegal gambling sites.
“We pretty quickly realized that the biggest threats to our respective companies came from outside the industry,” Eccles said of his change of heart. “That allowed us to spend time together and [we] started to talk about the future of the industry and where we wanted to take our companies. What we realized was we had really shared visions.”
A few logistical updates on the merger:
- The deal still needs regulatory approval before it can be finalized, and Eccles says they don’t expect things to be completed until the “second half of next year.”
- In the meantime, both DraftKings and FanDuel websites will continue to operate through the 2017-2018 NFL season. The decision on whether to close down one or the other is not imminent. “It’s a kind of 2018 thing,” Eccles said.
- We are still waiting on a name for the new joint-entity. DraftDuel? FanKings? We have no idea.