Two companies that went public via SPAC in the sports betting sector announced a partnership ahead of the upcoming National Football League season.
What Happened: Draftkings Inc DKNG and Genius Sports GENI announced a multi-year sports data supplier agreement.
Under the terms of the agreement, DraftKings will have access to Genius Sports’ full portfolio of sports data including National Football League game data.
Genius Sports signed a deal with the NFL earlier this year to be the official data provider for sports betting companies.
The deal follows DraftKings being signed as one of three official sports betting partners of the NFL.
DraftKings will deploy BetBuilder, a single-game parlay solution from Genius Sports, to its customers as part of the new deal. DraftKings will also use data and technology from Genius for customer acquisition and retention.
“It encompasses all aspects of our long-held belief that our sportsbook partnerships of the future will combine the best data, trading product and fan engagement solutions,” Genius Sports CEO Mark Locke said.
Related Link: The NFL Will Own 5% Of Genius Sports After Exclusive SPAC Deal With DMYD
Why It’s Important: Genius Sports landed the exclusive NFL rights from the league after beating out rival Sportradar for the new contract. With the NFL rights, Genius Sports could have better negotiating power with sports betting operators who will need to secure the official NFL data.
“The mutually beneficial terms of this agreement allow us to leverage Genius’ technology for years to come,” DraftKings Chief Business Officer Ezra Kucharz said.
Genius Sports highlights its DraftKings partnership as providing a “complete set of sportsbook solutions” for operators. Genius Sports said it can stand out from the competition with its offering and NFL data.
“Our official NFL marketing solutions will deliver new fully-connected experiences for DraftKings players. We’re powering the full player lifecycle — all the way from acquisition to pre and in-game engagement and long-term retention,” Genius Sports tweeted.
Genius Sports has partnerships for sports data with many of the top leagues in the world providing data for over 170,000 events per year.
Short Report: Activist investor Spruce Point Capital said Genius Sports overpaid for the NFL deal. Spruce Point said Genius is not a DraftKings and pays large amounts of money to leagues to gain rights.
“$GENI is not a levered play on more U.S. citizens increasing bets,” Spruce Point tweeted Thursday.
The firm says Genius Sports has more negative catalysts than positive catalysts for the future with the SPAC momentum and NFL deal in the past.
“Pleased to issue a ‘Strong Sell’ opinion on Genius Sports,” Spruce Point said calling for 60% to 80% downside risk.
Price Action: Investors are brushing aside the Spruce Point report and digesting the DraftKings news positively with Genius Sports shares up 5.04% to $16.66 and DraftKings shares up 2.47% to $49.87 on Thursday.
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