WEBVTT - DraftKings CEO Jason Robins Talks Super Bowl Betting

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<v Speaker 1>It's the big Super Bowl weekend and fifteen billion dollars

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<v Speaker 1>in sports betting is about to get even bigger. For

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<v Speaker 1>more on the sports betting business and how the Super

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<v Speaker 1>Bowl plays a role, we're joined by Jason Robbins from DraftKings. Jason,

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<v Speaker 1>you're the chief executive of one of the largest sports

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<v Speaker 1>books out there, but you're also facing some tough competition,

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<v Speaker 1>especially from those that are actually using contracts linked to

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<v Speaker 1>sports games but aren't the traditional sports books. I'm talking

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<v Speaker 1>crypto dot com call sheet. What kind of competition are

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<v Speaker 1>you seeing.

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<v Speaker 2>Well, I think a lot of different forms of gaming

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<v Speaker 2>right now, and those aren't exactly gaming. They're classified as

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<v Speaker 2>I think financial contracts. But a lot of different forms

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<v Speaker 2>of gaming are appearing. Those are in the regulated market.

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<v Speaker 2>There's actually a much larger illegal market. It's competitive with us,

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<v Speaker 2>and they're much more difficult to compete with because they

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<v Speaker 2>don't have to follow any rules or regulations. So definitely

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<v Speaker 2>a lot of competition out there right now, but we

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<v Speaker 2>feel like we have the best product in the best

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<v Speaker 2>customers experience, and in the end, we think that'll win the.

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<v Speaker 3>Day and regulator after regulator, you convince, Jason, what are

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<v Speaker 3>the winnings for you this weekend. Do you think how

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<v Speaker 3>many bets will be placed? What are your takeaways?

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<v Speaker 2>Oh, I can't really say what I think the numbers

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<v Speaker 2>will be. But each year the Super Bowl gets bigger

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<v Speaker 2>and bigger, so I expect this to be our biggest

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<v Speaker 2>day ever the Sunday, I should say, to be our

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<v Speaker 2>biggest day ever. Hard to know exactly what the numbers

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<v Speaker 2>will be, and right now it's a pretty balanced line,

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<v Speaker 2>so you know, in some ways that's good because that

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<v Speaker 2>means it won't be as volid ale. Although right now,

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<v Speaker 2>because we have so much money on player props, it's

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<v Speaker 2>much bigger deal. Whether you see Saquon Barkley, Jalen Hurts

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<v Speaker 2>and Travis Kelsey get in the end zone and who

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<v Speaker 2>actually wins the game.

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<v Speaker 3>Don't get our producers started on parlaying as well. But

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<v Speaker 3>I'm really interested, Jason more broadly on what this means

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<v Speaker 3>for your marketing efforts. Ultimately, this must be a massive

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<v Speaker 3>draw for people to then come back time and time again.

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<v Speaker 2>Well, Super Bowl is not only the biggest betting day

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<v Speaker 2>of the year, it's our biggest day of the year

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<v Speaker 2>for customer acquisition activation. So it's a huge day for

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<v Speaker 2>us marketing wise. We have a ton of stuff going

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<v Speaker 2>on all week leading up to the game and obviously

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<v Speaker 2>throughout the game, so big time for our marketing team,

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<v Speaker 2>and they've done a great job each year. We've won

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<v Speaker 2>the customer acquisition battle the last two Super Bowl I

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<v Speaker 2>think the last three Super Bowls, so we're very confident

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<v Speaker 2>in them and feel like we're gonna have a great

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<v Speaker 2>showing this year too.

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<v Speaker 1>There's another thing that's taking more people to their televisions

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<v Speaker 1>to watch the NFL. That's Taylor Swift. She's driven major

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<v Speaker 1>viewership since she's dating one of the Chiefs players, and

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<v Speaker 1>I'm curious DraftKings is capitalizing on this increase viewership in

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<v Speaker 1>any way.

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<v Speaker 2>Well, more viewership always is better for us, and I

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<v Speaker 2>think it's sort of this positive cycle where people bet

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<v Speaker 2>more and they tend to watch the games more and

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<v Speaker 2>they watch longer, and then more people watching needs more

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<v Speaker 2>opportunities from them placed wagress with us. So that's a

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<v Speaker 2>really good thing for our business. Obviously for the ratings

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<v Speaker 2>of the NFL. And I don't know how much Tailor

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<v Speaker 2>is contributing to it, but if she is, and thank you, I'm.

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<v Speaker 1>Not much of a gambler, But what can you tell

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<v Speaker 1>us about your current user base. Have you seen any

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<v Speaker 1>major shifts in who is putting wagers online?

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<v Speaker 2>You know, it's definitely been growing in terms of female

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<v Speaker 2>audience obviously, you know, for us, that's an important vector

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<v Speaker 2>because right now our audience is largely male, so we

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<v Speaker 2>think there's a lot of room to grow on that front.

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<v Speaker 2>In general, though the demographics haven't changed a whole lot.

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<v Speaker 2>Typically tends to be you know, on average age in

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<v Speaker 2>the mid thirties to late thirties, lots of people we think,

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<v Speaker 2>you know, coming from technology and educated backgrounds, typically a

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<v Speaker 2>you know, higher income consumer. So those tend to be

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<v Speaker 2>the demographics we see and that really hasn't changed since

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<v Speaker 2>we launched, but definitely seeing more women betters coming in,

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<v Speaker 2>which is a great thing.

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<v Speaker 3>I'm interested in sort of the fundamentals of the business

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<v Speaker 3>in large part not dictated by you, But how what

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<v Speaker 3>the outcome of the games are, I mean, customer friendly

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<v Speaker 3>wins with something that hit the numbers and the last

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<v Speaker 3>time that you came on and discussed them, So how

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<v Speaker 3>do you managed to navigate that and control your own destiny?

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<v Speaker 2>Well, there is always that, and you know this is

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<v Speaker 2>a business where we are taking a side of the action,

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<v Speaker 2>so there's going to be volatility in the results over time.

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<v Speaker 2>That normalizes. So the things that we can control or

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<v Speaker 2>what we focus on, which are making sure we provide

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<v Speaker 2>a great, great product for our customers and trying to

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<v Speaker 2>create more ways for them to bet and more ways

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<v Speaker 2>for them to engage, and you know, making sure we

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<v Speaker 2>have a really great back end operation to our trading.

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<v Speaker 2>Risk management is a plus, using our marketing to help

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<v Speaker 2>drive parlays and other forms of betting that we think

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<v Speaker 2>are good for margins and good customer So those are

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<v Speaker 2>the things we focus on and the outcomes will be

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<v Speaker 2>the outcomes. There's been some years that we've had good years.

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<v Speaker 2>In twenty twenty two, we had a good year. Last year,

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<v Speaker 2>you know, twenty twenty four wasn't. But it definitely can

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<v Speaker 2>vary year to year and that's part of the business.

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<v Speaker 2>But overall it doesn't really change fundamentals or the trajectory

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<v Speaker 2>of our business.

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<v Speaker 1>Well, growth drivers going forward for Generative AI, of course

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<v Speaker 1>is being kind of the key driver for a lot

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<v Speaker 1>of companies out there. How is Draftking starting to incorporate

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<v Speaker 1>this across the business? Any chance we could see any

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<v Speaker 1>tasks taken over by AI versus a human.

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<v Speaker 2>In the short term, we think generative AI is a

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<v Speaker 2>huge opportunity and it's really more about getting better outcomes

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<v Speaker 2>for our customers. Efficiency internally is simply a means to

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<v Speaker 2>an end for that. So everything from how do we

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<v Speaker 2>make sure we have great customer service and using chatbot

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<v Speaker 2>and AI do that, to making sure that our products

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<v Speaker 2>are as interactive as possible and easy to use as possible,

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<v Speaker 2>lots of areas for us to play AI really across

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<v Speaker 2>the entire business. A good chunk of our code. I

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<v Speaker 2>think I read a memo recently about fifteen percent something

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<v Speaker 2>like that of our code right now is being written

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<v Speaker 2>by generator of AI. So we really feel like we

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<v Speaker 2>have a long way to go, but also are seeing

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<v Speaker 2>some great traction with internal adoption.

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<v Speaker 3>Jason Robbins has been great having you on thirty one

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<v Speaker 3>buys on the stock zero Sells, and I'm sure you

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<v Speaker 3>might be having a great time this weekend. Jason Robin

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<v Speaker 3>draft King, CEO, thanks for stopping by.