Massachusetts Gaming Regulators Look Favorably on DraftKings’ Local Ties, Diversity Hiring

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A few giggles filtered through today’s live stream of the Massachusetts Gaming Commission as DraftKings CEO Jason Robins spoke about the commonwealth. 

The sports betting corporate heavyweight was showing commissioners that he knew how to pronounce the names of local cities: Gloucester, Haverhill, Scituate. And they seemed happy to hear it. Everyone likes a home-state success story after all, and DraftKings – which Robins and two buddies dreamed up in a spare room in a Watertown residence over 10 years ago – is definitely that. 

Today, DraftKings is a multi-billion-dollar company with offices in 11 countries and over 4,000 employees worldwide. But it hasn’t forgotten where it got its start. DraftKings is headquartered in Boston and has more employees in Massachusetts than any other single jurisdiction, Robins told the MGC. Over 1,300 DraftKings employees live in Massachusetts, he said. 

Robins lives in Massachusetts. So do other DraftKings top brass. 

What DraftKings doesn’t have in is a license as a mobile sports betting operator under the commonwealth’s 2022 sports betting law. Robins’ appearance was part of the company’s presentation today in its MGC evaluation for one of six standalone mobile licenses untethered to a casino. 

Today, the company met all expectations for one of those six licenses after a marathon hearing. It could be awarded a Massachusetts sports betting license when the MGC votes on untethered licensing awards next week. 

But it’s accurate to say that DraftKings’ roots in Massachusetts don’t hurt its chances. 

DraftKings a Home-State Favorite? 

The five commissioners on the MGC have repeatedly grilled both mobile and retail sports betting license applicants about plans for in-state hiring in recent weeks. MGC Chair Cathy Judd-Stein made her satisfaction with DraftKings’ in-state involvement known in her closing remarks today. 

“The fact that you are here in Boston, you’ve heard the commission say it’s a pleasure to see that when we know that the legislature always cares about the economic engine of gaming,” Judd-Stein said. “We appreciate that.” 

According to the commonwealth’s sports betting gaming regulations, the MGC is required to consider an applicant’s economic impact, including “employment opportunities within the Commonwealth.” Market share, diversity spending and hiring, and other factors are also at play. 

In his remarks, Robins told the MGC that DraftKings has employees in at least 150 cities and towns statewide. 

“In many ways, we’re still a local company,” Robins said. He apparently wants to keep it that way, too, based on his comments today. 

Massachusetts sports betting, DraftKings, Jason Robins
DraftKings CEO Jason Robins (AP Photo/John Locher)

“There’s an endless pipeline of talent (in Massachusetts),” he said, from venture capital to local government and tech company partners. Passionate sports fans, too, he said.

He’s right. According to Sports Media Watch, pro franchise rankings by Nielsen TV market size for 2022-23 put Boston in ninth place with viewership in 2.59 million homes across the NBA, NFL, MLB, and NHL.

But there are other licensing factors for the MGC to consider besides local connections. Companies must be in good overall financial shape. DraftKings is largely cash rich, with $1.2 billion cash in hand last year. And net revenue growth is strong, with 68 percent growth expected from 2021 to 2022 per Wall Street estimates.

That said, company officials say there’s been a lack of profitability due to customer acquisition costs. DraftKings officials told the MGC they expect finances to improve this year, with the company “achieving profitability [by 2025 or] shortly thereafter.”

Diversity Gets a Closer Look

Also brought up today was the company’s commitment to diversity — including hiring and spending on people of color, women, veterans, and other minorities. 

DraftKings told the MGC that females represent 22 percent of top leadership roles, 28 percent of manager roles, and 27 percent of all employee roles in the company. Minorities (including Black, indigenous, and people of color, or BIPOC individuals) represent 13 percent of top leadership, 17 percent of management roles, and 31 percent of all employee roles. 

 There are three women, two of whom are Black, on the company’s Board of Directors, 

For her part, Commissioner Nakisha Skinner said “I don’t think it’s a surprise” that an applicant’s commitment to diversity hiring and spending is important to her and her commissioners. She congratulated DraftKings for its progress in the area of the diversity of leadership, “notwithstanding the added focus that’s needed around women representation.”

Commissioners did say they would like specific goals for diversity supplier spending. DraftKings did not include those goals in their application. 

A lack of those specific goals in the application seemed to disappoint Commissioner Jordan Maynard. Although DraftKings isn’t alone in updating its supplier spending goals, Maynard said it could put a goal percentage on file. “I think to be consistent, that’s something that I would have to see,” he said. 

DraftKings official Graham Walters said it will look at “how we can set an appropriate target and goal going forward.” 

Licensing Decision Possible Next Week, Betway Up Next

Evaluations of untethered mobile sports betting licensing applicants by the MGC continue on Friday with Betway (Digital Gaming Corporation).  Evaluation of PointsBet comes next, on Jan. 17.

No actual licensing of the untethered applicants will happen until next week. The MGC has set Jan. 18 and 19 (and possibly Jan. 20) for that purpose. 

A mobile launch is expected in Massachusetts ahead of March Madness. A retail launch is slated for Jan. 31.  

About the Author
Rebecca Hanchett

Rebecca Hanchett

Legislative Writer
Based in Kentucky's Bluegrass region, Rebecca Hanchett is a political writer who covers legislative developments at Gaming Today. She worked as a public affairs specialist for 23 years at the Kentucky State Capitol. A University of Kentucky grad, Hanchett has been known to watch UK. basketball from time to time.

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