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Wrigleyville retail sportsbook is the ‘crown jewel’ of Chicago Cubs partnership: Draftkings co-founder

Draftkings co-founder and President Matt Kalish joins Yahoo Finance to discuss the company’s sports betting deal with the Chicago Cubs, and Michael Jordan joining as a special advisor to the board.

Video Transcript

BRIAN SOZZI: Some market moving news out this morning in the sports betting landscape. DraftKings announced it is becoming the official sports betting and daily fantasy partner for the Chicago Cubs. Here to discuss the details is Matt Kalish, DraftKings co-founder and president, along with Yahoo Finance's editor at large, Dan Roberts. Matt, let me start with you here. Big deal, another big deal in as many days for DraftKings. What is tying up with the Cubs mean for DraftKings' bottom line?

MATT KALISH: I mean, we're really excited about working with the Cubs. We're the official sports betting partner. The Cubs are a storied franchise that's beloved nationwide, but especially in Illinois and in Chicago, which is one of the newest sports betting markets for us, and one of the biggest. So we're extremely excited to jump in with the Cubs. One of the most exciting aspects of the deal includes building out in Wrigleyville within a small radius around the stadium, what will be one of the greatest sports spokes I believe in the country from a retail standpoint.

So we're really excited about putting forth some plans for that to the Illinois gaming board, the city and state regulators, and looking to move really quickly on that project. And additionally, just being the exclusive marketing partner with the Cubs, I think will carry a lot of weight in the market. So we're extremely, extremely excited to get going.

DAN ROBERTS: Matt, Dan Roberts here. You guys are now the exclusive sports betting partner of the Cubs. Can you just explain for our viewers, how it works with each league? As I understand it, a lot of the leagues have a league level partnership with DraftKings or in some cases, with FanDuel, your competitor. But then in most cases, each individual team is still allowed to make their own deals with a different provider. I know for a long time, NBA was FanDuel, but individual teams could make a deal with DraftKings and so on. So you guys are the partner of the Cubs, but what's the deal in terms of teams to team and league to league?

MATT KALISH: Yeah, sports betting is opening up rapidly in the US. There's different stakeholders all around the table, whether it's leagues, teams, media companies, operators such as us. And our arrangements with different leagues and teams are different in almost every market, but we work very closely with Major League Baseball as an authorized provider of sports betting. We also with the Cubs, that was a commercial agreement where we're the exclusive partner of the Cubs for sports betting.

That means that every consumer touchpoint touching the Cubs, whether it's, you go to a game, the signage in the stadium, the distribution through Marquee Sports Network, basically every touchpoint related to the Cubs, DraftKings will be front and center as the exclusive sportsbook. And then also this project of building out a retail sportsbook at Wrigleyville I think is probably the crown jewel of that partnership.

BRIAN SOZZI: And then to follow up on that, because we're talking about individual teams partnering up with DraftKings, are you now the batting partner of the Charlotte Hornets because of the news yesterday about Michael Jordan? Or is Jordan's involvement separate from the team, where he is chairman and majority owner? And then speaking of Jordan, I would just ask, what else we can expect in the near future in terms of the DraftKings and Michael Jordan? Will we see him in ads? What might happen next as a result of him taking on this role?

MATT KALISH: The news of Michael Jordan joining as a advisor to our board, a strategic advisor, is extremely exciting to everyone, not just me as a board member, but also everyone around the table at DraftKings, our staff and our customers, everybody was very excited to hear that Michael was jumping on board to consult with us on various initiatives. I think he's a marketing and branding genius. We will try to get as much impact as possible from the relationship with Michael. It's separate from any team deal. It's an individual deal with Michael where through this partnership, I hope to see him make a big impact on our branding, our marketing, and just generally consult with us on a variety of different tasks related to growing DraftKings.

ALEXIS CHRISTOFOROUS: Hey, Matt, can you talk to us a little more about what the retail sportsbook experience might be like for fans? I mean, will there be actual kiosks and betting windows located physically at Wrigley Field? Because I thought the MLB prohibited that kind of stuff. And how does that fly in an environment where, I mean, we can't even go to games right now. We don't know when we're getting back to a stadium.

MATT KALISH: Yeah, so first of all, I think this is going to be a project that takes a couple of years to get off the ground. Hopefully, the environment around going to baseball games and things like that is much more normal, I think, by that stage. Our process is we're scouring the area of Wrigleyville around Wrigley Field. We're looking for the best possible location to build a flagship sportsbook that really represents the Cubs, DraftKings well. It will be a bar restaurant and a retail sportsbook destination that I believe has the potential to be the largest retail sportsbook in the country, given just how populous downtown Chicago is.

It's an amazing opportunity. But we have to go through the process of getting our approvals. So starting with the Illinois Gaming Board, the city, the state, we want to build great relationships there. We want to be embraced by the city and have a long-term, very healthy relationship. So first things first. We got to go through that process, and then hopefully, we can start construction soon and announce more of our plans.

DAN ROBERTS: Matt, let's shift to NFL. The season is set to start September 10, and I know that every year in a regular year, that first week of the NFL season is huge for you guys, because that's when you get the most new user signups. Now interestingly, a lot of people are observing right now that it doesn't feel like there's as much oomph and excitement heading into the NFL season as there usually is. Maybe that's because there was no preseason, maybe it's the pandemic. But I just wonder what trends you guys are seeing. Is it likely to be as huge a time for you guys as it usually is in terms of getting new users to join?

MATT KALISH: Yeah, I think this year, and we just had our Q2 earnings where I think we released a lot of the great momentum from April into May into June, that progress as things kind of came back online from a sports standpoint. It's an unprecedented year. There's lots of sports in season, such as NBA and baseball in August that weren't in season last year. But NFL launch is always going to be our biggest sort of tentpole event of the year. That's the thing that is our biggest activation window. Everyone is really, really excited for it.

And so you'll start to see more of DraftKings advertising, you'll see great promotions coming out. We actually just launched the 100 Million Golden Ticket Giveaway, which every single American by logging into DraftKings can get a prize instantly between $5 and $25,000. And so that's just a very low inertia way for people to come on and try the product. So a lot going on for NFL. I think it'll be a great season and we're excited for about a week from now, Thursday Night Football will be kicking off.

ALEXIS CHRISTOFOROUS: Hey, Matt, I saw this thing called Rainmakers. It's a Rainmakers campaign, your first ever where you're going to incorporate influencers from sports, but also outside the world of sports. Music, pop culture. Can you explain quickly for us what that is?

MATT KALISH: There's tens of millions of fantasy players in the country, and some of them just happen to be everyone's favorite athlete, celebrities, et cetera. So DraftKings is partnering with a sort of laundry list of America's favorite celebrities, America's favorite kind of sports athletes, and working with them week to week throughout the NFL season on various kind of marketing activations, odds boosts in the sportsbook. And probably the biggest feature of that deal is, they're all going to be jumping into our weekly Millionaire Maker contest, where somebody wins a million dollars every week on DraftKings.

And if you beat some of the athletes, then you're eligible to join into a contest the next week. It's an exclusive contest that will kind of reward the people that were able to beat our Rainmakers. I also want to say everyone of the Rainmakers are playing for charity. They want to benefit a cause that they care about. So I think it'll be a great way to build awareness and raise money for some really important causes that matter to some of our favorite celebrities or athletes.

BRIAN SOZZI: Matt, real quickly, before we let you go, back to Michael Jordan. Has he expressed any interest in actually being a board member?

MATT KALISH: I think we're all reticent that as a team owner, there's some guidelines that have to be adhered to there. But DraftKings is certainly going to look to get as much as possible as a strategic advisor, bouncing ideas off of each other, sort of using his brand and marketing genius to further the growth of our company. And so we're going to start with a deal that we have and get as much out of that as possible.

BRIAN SOZZI: All right, fair enough. Matt Kalish, DraftKings co-founder president and Yahoo Finance's Dan Roberts. Good to see both.

MATT KALISH: Thank you.