FanDuel and DraftKings made peace with California tribes over sports betting expansion
The top executives at DraftKings and FanDuel admitted past mistakes and struck a conciliatory tone with California tribes Monday at the Indian Gaming Association’s annual tradeshow and convention. They also look forward to partnerships to make sports betting work in the Golden State.
Jason Robins, CEO and co-founder of DraftKings, and Christian Genetski, president of the FanDuel Group, were invited by the IGA to kick off its convention in San Diego as part of an afternoon session on online gaming.
Moderated by conference chairman Victor Rocha, the session marked more than two years since gaming operators led by FanDuel and DraftKings spent hundreds of millions of dollars on opposing ballot measures, one legalizing retail sports wagering for tribes and racetracks, the other corporate-backed legalizing of online sports betting. Both measures were soundly defeated.
Rocha hosted the hour-long discussion on partnering with established gaming brands that can provide tribes with a strategic advantage in the online gaming market. Though receptive to working with their one-time adversaries, the tribes haven’t said when they will put another measure on the ballot.
When asked by COMPLETE iGAMING if the operators might ask for another ballot measure as adversaries of the tribes, Genetski said that “it’s safe to say” the operators wouldn’t do that and instead partner with the tribes.
“We’ve said that we still believe that a solution for California creates winners across the board and, most importantly, creates a real generational opportunity for tribes in California,” Genetski said. “We know that conversation needs to be driven and led by the tribes. We continue to say that we’re available to share any and all of our information to be helpful in finding a framework that starts on a principle of tribal sovereignty, ownership, and wealth creation. As we figure out the details, we can contribute to that conversation in a meaningful way with our experience in how to invest and grow and what we can lend to creating a big pie that gets shared appropriately.”
Robins, who last appeared at the IGA conference nine years ago before the operator became what it is today, said DraftKings is looking for long-term partners and acknowledged the importance of California, a tribal-led state where sovereignty is the governing principle.
“No other state out there has more ability to impact our long-term growth than California,” Robins said. “If California were a country, it would be the third or fourth largest economy in the world. Tribal relationships are absolutely essential and it’s the only way to do it here. There’s no chance for online sports betting in California without tribes feeling like their sovereignty is respected. We learned early that we didn’t understand this was different. We thought that as long as it works in a way where everyone is doing well and the opportunity to make money and tribal sovereignty are respected, that’s fine. How the tribes wanted to do it was totally different than with other tribal partners around the country. That was the big lesson for us: California is its own place and every place is unique. You have to understand the people, communities, and situations. No solution will be exactly the same.”
Rocha responded by citing companies that don’t respect the tribes, such as sweepstakes and other operators whose legality is being challenged, while praising FanDuel and DraftKings for their turnaround in approach.
“I believe you guys, because I’ve been on both sides of the fence with you,” Rocha said. “If you understand sovereignty, that helps you understand the world. Some companies, like MGM and BetMGM, have made their entire identity fighting sovereignty. To me, companies like that don’t get a pass. You have to walk it like you talk, because we’re paying attention. We want partners who are honest because we’re honest. We want the same type of partnership with the morality we have.”
Robins said he’s not going to sit there and say “we don’t make mistakes.” Those who partner with DraftKings know they care and want to do it the right way and have great relationships. “It doesn’t mean you get it 100% right, but if you learn from your mistakes and do things better the next time, that’s how you prove you have the best intentions. Not everybody is that way.”
Rocha noted that some tribes around the country want to use their own brand and technology to operate online sports betting and igaming, while others may want to partner with a sports betting company. He said tribes want partners that have their best interest at heart and can grow with them.
“Some tribes have found it helpful to team with some of these bigger companies,” Rocha said. “I brought them (here) to ask them about that.”
Rocha said tribal gaming has become a big part of the national landscape, now offered in 26 states, and both operators said it’s a big part of what they do.
“Tribal gaming is incredibly important to a company like FanDuel,” Genetski said. “We want to be a nationwide company and operate in as many states as we can. Tribal gaming is a key component and we’re currently partnering with tribes in some states that are live and others with partnerships in waiting. We’re working together to find out the right way to open a state and gain access to the market. In other states, we’re continuing to talk to tribes, the most important stakeholders in a number of states, that would enable access to gaming in those states on the time schedule and under the right structure that works for those tribes.”
Among those, DraftKings partners with the Bay Mills Indian Community in Michigan for sports betting and igaming — its first tribal relationship. Meanwhile, FanDuel partners with the Mohegan Sun for sports betting in Connecticut.
“I feel what we’ve been able to do together is impactful for us and for them,” Robins said of the Michigan tribe. “That’s what it’s all about: impacts in the communities with the funds generated.”
Genetski said FanDuel, which doesn’t have land-based casinos, operates only through partnerships. The idea is to be together in business for decades, trust each other, and share in the economics.
“Tribal partnerships are on another level,” Genetski said. “With tribes, it’s a lot more than just the bottom line. There’s tribal sovereignty, protection of the community, and thinking of the benefits over generations, not just quarter to quarter. We want to be there for our partners and care about the things our partners care about. It’s been a learning process, but an inspiring one.”
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