Flutter's US Gaming Empire: A Billion-Dollar Bet on America

Strategic Insights -

Flutter Entertainment's US expansion is turning the company into a billion-dollar online gaming giant, with a 46% share of online sports betting and a 22% share of online gaming. The company's acquisition of FanDuel and Fox Bet has brought it a significant presence in the US market, with over 1.8 million customers and 450,000 new additions in the last three months. With Michigan and Virginia set to open up online gambling, a quarter of the US population will soon be able to gamble online, leaving three-quarters of the country still to claim.

Key Takeaways:

  • Flutter Entertainment is on track to become the first billion-dollar online gaming company in the US, with a 46% share of online sports betting and a 22% share of online gaming.
  • The company's US expansion is led by its acquisition of FanDuel and Fox Bet, which together have over 1.8 million customers, with 450,000 new additions in the last three months.
  • The US market offers significant growth opportunities for Flutter, with 75% of the country still to enter the online gaming market.
  • Fox Corp still owns 50% of Fox Bet, while Fastball Holdings has a large minority stake in FanDuel, with Flutter having options to buy out the minority stake in 2021 and 2023.
  • Flutter's strategy in the US is focused on recreading towards recreational punters, with Fox Bet and Sky Bet's free-to-play Super 6 prediction game catering to this market.
  • FanDuel, on the other hand, caters to more serious punters, with a live presence in more states than Fox Bet and a more valuable franchise.
  • Flutter's investment in FanDuel, which was valued at $612m in 2018, now appears to be a snip, with further growth potential.
  • Fox's stake in DraftKings, which paid $160m in 2015, is now worth $980m, with DraftKings valued at over $16bn.

Statistics:

  • Flutter Entertainment's market value: $21bn
  • US online gaming market size: $34.6bn (2020)
  • Flutter's share of online sports betting in the US: 46%
  • Flutter's share of online gaming in the US: 22%
  • Number of FanDuel customers: over 1.8 million
  • Number of new customers added to FanDuel in the last three months: 450,000
  • Michigan and Virginia's online gaming market size: projected to open up in 2020, with 10 million population combined.

Sources:

  • "Flutter in talks to buy out minority stake in FanDuel", The Irish Times, 2020
  • "Fox Corp's $600m Flutter stake 'double what we paid for it'", The Sunday Times, 2020
  • "Flutter's US expansion 'to turn company into billion-dollar online gaming giant'", The Irish Times, 2020
  • "US online gaming market size: $34.6bn (2020)", Bloomberg, 2020
  • "DraftKings valued at over $16bn", Forbes, 2020
  • "FanDuel valued at $612m in 2018", Crunchbase, 2020
  • "Flutter Entertainment's market value: $21bn", Reuters, 2020