May 28th, 20254 mins

Draft Games Relaunched by Underdog Fantasy

Underdog Fantasy is back in the Big Apple. Two months after the DFS games provider pulled out its daily fantasy sports games in New York, it has once again launched its draft-style games, and the DFS games are now included in the new terms of the company's license in the state. Underdog Fantasy has officially relaunched its draft-style daily fantasy sports (DFS) games in New York, just two months after a regulatory dispute forced the company to pull out of the state. The company announced the return of its draft contests, confirming that these games are now operating under the terms of its temporary DFS license. While the return is a significant development for New York fantasy sports enthusiasts, it comes with limitations. Notably, Underdog's popular pick'em contests - both the peer-to-peer (P2P) and against-the-house formats - remain unavailable in the state for now. Regulatory setback and exit Underdog Fantasy's brief exit from New York in mid-March was prompted by a ruling from the NYSGC, or New York State Gaming Commission. The commission determined that the DFS products Underdog had been offering were not explicitly covered under its temporary license, which the company had inherited from Synkt Games following its acquisition of the business in 2022. In response to the NYSGC's decision, Underdog withdrew all DFS contests from the state and agreed to a settlement that included an $18 million payment. The NYSGC maintained that the contests offered by Underdog significantly differed from those Synkt had originally applied to operate under its 2016 licensure agreement. Push for a permanent license New York has long relied on temporary DFS licenses, but the state is finally moving toward establishing a permanent licensing framework for fantasy sports operators. Underdog has confirmed that it has applied for a permanent DFS license, signaling its intent to solidify its long-term presence in one of the country's largest markets. Underdog Fantasy's return to New York coincides with a major financial milestone for the company. The operator recently closed the first round of its Series C funding, raising $70 million and bringing its pre-money valuation to over $1.2 billion. The funding round, led by Spark Capital, is expected to eventually surpass $100 million. The substantial increase in valuation marks a nearly threefold rise from the company's Series B valuation of $485 million in 2022. Jeremy Levine, Chief Executive Officer and founder, described the investment as “a real accelerator” for the company's product development and expansion plans. This funding will help us continue building the best sports gaming products for fans in the US, Levine said. It also gives us the ability to bring top-tier talent into our team to support that mission, he added. Expansion and strategic moves Begun in 2020, Underdog Fantasy has grown rapidly, boasting nearly four million users across the US. The company claims to be the fourth most downloaded sports gaming app nationwide, operating at the intersection of fantasy sports and sports betting. Following its exit from New York in March, Underdog launched its Champions Pick'em peer-to-peer product in neighboring Delaware and New Jersey. The company also offers sports betting in select markets and is eyeing further expansion. Notably, Levine has expressed interest in entering Missouri when its sports betting market launches on December 1. The return of Underdog's draft games in New York marks a key step in the company's efforts to reestablish itself in a critical DFS market. As the regulatory environment evolves and the state works toward a permanent licensing system, Underdog is positioning itself to be a long-term player in New York and beyond. For now, New York sports fans can once again engage with Underdog's unique draft-style contests, while the company continues to push for broader access and regulatory approval for its full suite of fantasy products.