The Early Line: DraftKings Is Moving To A 'Super App' That Includes Prediction Markets
Roundup: NCPG releases survey data about underage gambling; new lobbying group surfaces to fight sports betting via prediction markets.
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DraftKings launched its prediction market late last year as a standalone app. Now, Predictions will get rolled into the core DraftKings experience as it endeavors to launch a “super app.”
From a press release on Monday coming out of DraftKings’ Investor Day:
The Company also announced plans to launch a new Super App, branded DraftKings Sports & Casino, bringing together Sportsbook, Predictions, Casino and Lottery into one seamless, integrated experience through a single account and wallet, with access tailored to each jurisdiction. Phase one of the integration is expected by March Madness, with additional upgrades planned throughout the year. The Super App will leverage DraftKings’ experience and infrastructure operating the No. 1-rated Sportsbook to offer a unified sports experience, available nationwide.
Some interesting notes from the Investor Day and presentation:
DraftKings is saying Predictions will have a 10-30% higher adjusted gross margin than sportsbook.
Its sports business (across sportsbook and predictions) could more than double by 2030 (see slide below).
On-demand parlays via prediction markets are in development.
Here is what Jeanine Hightower-Sellitto, general manager of Predictions, said on the webcast. (It’s notable she was the first one to speak after CEO Jason Robins):
Our strategy to win in predictions will largely follow our sportsbook playbook. We will be vertically integrated, leverage our proprietary sports pricing and trading capabilities. We have a deep understanding of sports customers, and we have premier national marketing assets.
These advantages have driven our success in sportsbook, and now in Predictions, we will benefit from the same advantages. We will vertically integrate to achieve superior unit economics and control more of the customer experience. The super app is the distribution breakthrough.
But what makes this business structurally attractive is vertical integration. We intend to own more of the prediction stacks, so we control the end to end customer experience and the economics that come with it. That means faster innovation velocity, better unit economics, and tighter control over quality as we scale.
And while the super app is broad by design, the predictions product inside will be exceptional. A sports-first experience with the functionality, speed, and polish, customers already associate with DraftKings. We are not building a side app.
We are building a core DraftKings product, and we will keep raising the bar. We believe predictions could represent a $10 billion annual gross revenue opportunity in the years ahead, and we intend to lead in this category. Vertical integration will help us achieve this goal.
We will leverage our proprietary pricing and trading capabilities to create the deepest and broadest sports offering. In predictions, liquidity is central to the experience. Tight, two way markets, real depth, and fast updates are what customers feel and what drives customer attention.
DraftKings is built for this because we spent years building a proprietary sports, pricing, and trading stack. The same sports data, modeling, trading, and risk infrastructure, that powers our number one-ranked sportsbook, will power our predictions offering, enabling broader market availability, deeper content, and a better live experience. And in the next few months, we plan to launch a dedicated market making division, because bringing our own liquidity to market is how we will deliver tighter pricing and a more consistent customer experience.
This is also where AI and machine learning compound the advantage. Sharper probabilities, faster adjustments, smarter risk, and better unit economics at scale. We have a deep understanding of sports customers.
Another advantage is simple, but it’s massively underestimated. We know sports customers. We’ve been serving sports fans for nearly 15 years across fantasy and sportsbook.
And we understand what drives engagement in the live moment. We know the mindset of a fan who wants to get in on the action and not just manage a generic trading workflow. That’s how we’re building Predictions.
It will feel like DraftKings. Sports first, content cards, markets and combos that match the moment, and promotions and context that make participation intuitive. And because we have rich cross vertical data, we can personalize the experience for our customers from day one.
So discovery, recommendations, and the entire journey get more relevant with each session. We will leverage our national marketing footprint to efficiently acquire customers across verticals. Now, let’s talk about distribution.
DraftKings already has a scaled national marketing footprint, the brand, the creative, and premium relationships that show up in the biggest moments in sports. Predictions makes those assets more valuable overnight, because we can now convert that demand in places where sportsbook isn’t live today. With the super app, it’s one brand, one app, and one funnel.
So national marketing can drive efficient customer acquisition across both sportsbook and predictions, across all 50 states. That is a real structural advantage in CAC efficiency and in speed to scale. Our predictions offering will rapidly improve in 2026.
We are moving fast. We already launched DraftKings Predictions through CME’s exchange, expanding capabilities through Crypto.com, and from here, our roadmap accelerates. More exchanges and combinations, our market making launch, and Railbird coming online.
And most importantly, our super app integration. All of these milestones increase innovation velocity, improve unit economics, and drive more efficient customer acquisition. Over time, we intend to build toward deeper vertical integration, including in-house exchange technology.
And, as we scale, an in-house FCM and clearinghouse components, so we can capture more customer economics and control more of the customer experience.
This is the same playbook we run again and again. Launch, iterate fast, and own the parts that really matter. We will keep raising the bar for quality in the industry. Our goal is clear. By the start of the NFL season, we intend to deliver an industry-leading sports predictions experience and scale it profitably from there.
For my last point, it’s important to understand that the profit opportunity from predictions is significant. While revenue in this category is just beginning to build, you’ve studied the business in depth and have strong confidence in a high adjusted gross margin profile. Compared to sportsbook, we expect our predictions adjusted gross margin to be 10 to 30% higher.
This is because this industry does not have state gaming taxes, and we expect long-term promotions to be more limited. Of course, we will follow the data to better understand the customer lifetime value as we deploy our growth investment over the next year.
And some slides:
📚Reading the line
A move to a super app certainly makes a lot of sense. DraftKings currently has a variety of apps, including the new Predictions app. It’s far more efficient to get everyone doing as much as possible on a single app, rather than having to move them from app to app, depending on how they want to bet/trade/play fantasy/buy lottery tickets.
Look no further than Robinhood (and other financial platforms) for examples of the “everything” app integrating prediction markets. DraftKings is moving to that, except for sports specifically, but also adding on predictions in other realms.
It’s notable how much DraftKings is highlighting prediction markets as a major growth engine here. This was one of the first things discussed on the Investor Day webcast and in the presentation. Predictions isn’t a side project.
DraftKings emphasized vertical integration and owning the stack. It bears repeating: If you see prediction markets as a major new opportunity, you would want to own the plumbing, right? Robinhood saw that, and did M&A. DraftKings did too, and bought Railbird.
Parlays are coming! Not that long ago, DraftKings and FanDuel seemed to be pooh-pooh’ing the idea of custom parlays via prediction markets. Now it’s firmly a part of the road map.
Know the Risks
Randy and Anita discuss the common risks associated with sports betting and other forms of gambling that parents and other trusted adults should understand. In this clip, they talk about the heightened risk of problematic gambling after early exposure, and the reality that young people may not grasp the financial impacts of gambling.
Trusted Voices is designed to equip adults, including parents and coaches, with tools and resources to talk to young people about gambling, including information on warning signs and risks.
Gambling news roundup
Underdog Cuts Jobs While Pivoting to Prediction Markets (Front Office Sports): “Underdog has cut two-thirds of its fraud operations team as part of a larger round of layoffs that comes as the company’s focus shifts from traditional sports betting and paid fantasy draft contests to prediction markets. At least 15 total people were laid off, according to posts from now-former employees on social media. Underdog has more than 600 total employees, according to LinkedIn. Affected employees were informed during the workday on Friday, Feb. 27, that their jobs had been cut. In addition to substantial layoffs in the fraud operations department, Underdog cut jobs across areas like customer support, graphics, and ‘drafts’ — a product offering daily and season-long draft-based games.”
Reverse job board
If you are the victim of a recent layoff in the sports betting industry — or looking to hire — I am going to work on promoting my reverse job board on social media this week (and of course in the newsletter). The hope is to match job seekers with prospective employers.
National Survey Finds Widespread Gambling Participation Before Age 21 Amid Public Concern About Youth Exposure Risk (NCPG): As gambling becomes more accessible across digital platforms, a national survey conducted by The Harris Poll on behalf of the National Council on Problem Gambling (NCPG) finds that many U.S. adults report participating in gambling activities before age 21, while routine healthcare screening for gambling behaviors appears rare. The survey also found that nearly eight in ten Americans (79%) believe gambling addiction in the U.S. is as serious or more serious than other types of addiction like alcohol or drug addiction.
The findings, released during Problem Gambling Awareness Month (PGAM), show that nearly two thirds of adults aged 21 and older (65%) report participating in at least one form of gambling before age 21. Among those activities:
40% played lottery or scratch-off tickets
37% played home games with friends/family for money
23% placed a sports bet
21% played online casino-style games
Played fantasy sports (16%)
Other form (3%)
Full survey data here.
New Conservative Coalition Looks To Stop Sports Betting Via Prediction Markets (Event Horizon): Prediction markets are getting a new opponent: conservatives. A group called Gambling Is Not Investing is forming to challenge federally regulated sports event contracts.
From a press release: Today, Gambling is Not Investing, a coalition of consumer advocates, announced its launch to advocate for consistent consumer protections and regulatory accountability by enforcing existing state and tribal gaming laws for prediction markets that facilitate illicit sports betting through event contracts. These platforms operate outside established state and tribal gaming frameworks, bypassing safeguards voters and elected leaders have put in place across the country.
The overwhelming majority of activity that occurs on these platforms are sports-event contracts, where participants are gambling on sports without the rules and regulations that govern legalized sports betting. According to prediction markets platform Kalshi, sports events account for 90 percent of their volume.
“Gambling products – regardless of what you call them – must follow established state and tribal laws,” said Congressman Mick Mulvaney, Executive Director of Gambling is Not Investing. “Rebranding sports wagering as ‘trading’ or ‘investing’ or ‘predicting’ misleads consumers, undermines responsible gaming protections, and weakens the state and tribal systems built to protect the public and fund vital community services.”
Plus my latest roundup on all prediction markets happenings:
And more on PMs from Straight to the Point:
Sports Betting Alliance continues push against Wisconsin sports wagering bill (The Center Square): “As the Wisconsin Senate prepares to act on a sports betting bill that passed the Assembly, the Sports Betting Alliance is continuing its push to have the legislation changed to include SBA’s members. That could mean changing the framework of the bill or making it a constitutional amendment that would go on a statewide ballot, Sports Betting Alliance President/CEO Joe Maloney told reporters Monday afternoon.”
Vermont latest state looking to copy Illinois’ per-wager tax (SBC Americas): “Rep. Thomas Stevens’ H 913, which has 12 additional co-sponsors attached, is officially labeled ‘An act relating to prohibiting certain prediction markets securities.’ … Meanwhile, the bill also proposes a major alteration to the state’s authorized online sports betting market: Stevens and Co. want to replicate Illinois‘ first-in-the-nation per-wager tax on all sports wagers taken by licensed sportsbooks in the state.”
Bill Banning ‘Dual-Currency’ Gaming Pre-Filed In Louisiana (Sweepsy): “Another state has joined the list of markets considering legislation that would outlaw Sweeps Coin gameplay at sweepstakes casinos in the 2026 legislative session. On Friday, Louisiana Rep. Laurie Schlegel pre-filed House Bill 883 ahead of the start of the state’s legislative session on March 9. HB883 updates Louisiana’s definition of illegal online gambling to include the type of economic model traditionally used by sweeps casinos.”
Oklahoma Bill Banning Sweeps Casinos Passes 2nd House Committee (Sweepsy): “House Bill 4130 essentially adds any type of online casino gaming to the purview of current or future gambling that cannot be offered by any entities in Oklahoma other than tribes operating under the Indian Gaming Regulatory Act. And, in addition to the new ‘online casino games’ language created by the bill, HB4130 also modifies the definition of ‘representatives of value’ to include the gaming model employed by most traditional sweepstakes casinos, thus classifying sweeps gaming as online gambling.”
“HB4130 passed its second House committee on Friday — with both committee votes on Feb. 17 and Feb. 26 being unanimous approvals — and on Friday it also added Sen. Todd Gollihare as a second author, setting the stage for its potential pathway through the Senate.”
Fairfax Casino Bill Advances to Full Virginia House (Northern Virginia Magazine): “A bill that would open the door to allowing a casino in Fairfax County was approved by the Virginia House Appropriations Committee and will now head to the full Virginia House of Delegates for a vote. The Appropriations Committee approved the measure on Friday with an 18-4 vote. In the committee vote, three of the four votes against the bill came from Fairfax County representatives: Paul Krizek (D-16), Kathy Tran (D-18), and Charniele Herring (D-4). Del. Marcia Price (D-85), of Newport News, was the fourth.”
Ifrah Law has been at the center of advancing iGaming in the U.S., shaping groundbreaking legislation, leading precedent-setting cases, and guiding clients that span the iGaming ecosystem through every phase of their business journey. Learn more at IfrahLaw.com.
Bad Influence: Latest Drake/Stake Controversy Only Adds To Online Gambling Trust Issues (Casino Reports): “Two people does not a sufficient sample size make. Still, I was struck by how, in back-to-back conversations about online gambling, two people who should be among the target audience for regulated online casino and online poker told me they don’t play because they can’t trust it.”
And here’s the Bloomberg piece.
FIFA Extends Long-Standing Integrity Partnership With Sportradar (press release): FIFA has extended and expanded its integrity services agreement with Sportradar Group AG), a leading global sports technology company creating immersive experiences for sports fans and bettors, for an additional five years, reinforcing a long-term partnership dedicated to safeguarding the integrity of football worldwide.
The renewed agreement, which runs through 2031, provides comprehensive AI-driven bet-monitoring services and now includes expanded intelligence and investigation support and dedicated risk assessment services for both FIFA and its 211 member associations. These additions further strengthen FIFA’s ability to identify, assess and respond to integrity risks across a broad and evolving global betting and competition landscape.
Sportradar will provide integrity services across men’s and women’s FIFA international competitions; men’s and women’s confederation-run international and international club competitions; senior men’s and women’s domestic matches from the top two tiers; and the main national cup competitions across all member associations.
Since 2017, Sportradar has monitored more than 600,000 matches globally on behalf of FIFA through the company’s proprietary Universal Fraud Detection Service (UFDS AI).
Andreas Krannich, Sportradar’s EVP Integrity Services, said: “The expansion of our integrity agreement with FIFA further strengthens the ability to identify, assess and respond to risks in an increasingly complex global picture. It underlines both organisations commitment to fair and clean sport at all levels globally.
“Our integrity services are designed to address risk in a joined-up way, combining bet monitoring through our AI-powered Universal Fraud Detection System (UFDS AI) — built in-house using more than 20 years of historical data — with rapid reporting from betting operators, alongside comprehensive education and prevention programmes delivered to sports organisations worldwide.”
Onrise and EPIC agree strategic partnership for gambling harm prevention (press release): “Onrise, the trusted mental health platform for athletes across the US, has agreed to a strategic partnership with leading harm prevention consultants EPIC Global Solutions to enhance gambling harm prevention services for athletes and coaches at professional and collegiate level.
Collaborating to deal with the growing issues connected to sports wagering and other forms of gambling, EPIC’s expertise – grounded in lived experience of gambling addiction – will support the 250+ peer support experts at Onrise by providing face-to-face or digital education options for sports organisations to promote awareness of safer relationships with gambling products.
The additional service will be made available to supplement the comprehensive Onrise network, which includes peer support from retired and certified athletes, licensed therapist, psychiatric care and sports performance, delivered through secure one-on-one sessions with flexible scheduling.
Kim Quigley, founder and CEO of Onrise, brokered the partnership after seeing evidence of EPIC’s delivery method, which currently includes education programmes to NCAA student-athletes and staff as well as major league professionals.
“Student-athletes live in a time where gambling and sport intertwine in so many ways, with significant wagering interest in collegiate sport,” said Kim Quigley, MD, CEO of Onrise. “This partnership with EPIC Global Solutions is about getting in early, before a bet becomes a burden they carry in silence. By pairing world-class gambling education with Onrise’s always-on, athlete-specific mental health care, we can spot risk sooner, intervene faster, and protect their health, future, and the team communities depending on them.”
Resorts World gets approval for former Nevada governor, top regulator to join board (iGB): “The Nevada Gaming Commission unanimously approved Brian Sandoval and AG Burnett for licensure on Resorts World Las Vegas’ board of directors Thursday, representing a rare moment across the dais for two men with decades of experience overseeing Nevada’s gaming industry. Sandoval, who chairs the Resorts World board, previously served two terms as governor of Nevada and chaired the gaming commission, while Burnett helmed the Nevada Gaming Control Board for more than five years. Sandoval appointed Burnett to that role more than 10 years ago, and the two are teaming again to overhaul a Strip casino struggling to overcome financial and regulatory missteps.”
Hawthorne Race Course Files For Chapter 11 In Illinois (Casino Reports): “Hawthorne Race Course, which has struggled for years to secure financing in hopes of building a $400 million racino in the south Chicago suburbs of Stickney, filed for a Chapter 11 reorganization in federal Bankruptcy Court in Chicago on Friday. In the filing, Hawthorne Race Course lists estimated assets between $50 million and $100 million, estimated liabilities between $100 million and $500 million, and an estimated number of creditors between 200 and 999.”