The horse-racing subsidiary of DraftKings has been cleared to launch in its home state.
DraftKings Inc., the Boston-based provider of online sports betting sites, announced in November that it was teaming up with Churchill Downs Inc. (CDI) to roll out a new horse-racing app called DK HORSE.
The pari-mutuel wagering app’s accounts and funds will be separate from DraftKings' sportsbook and casino apps. It is scheduled to start taking bets before the 149th Kentucky Derby in May.
DK HORSE has already been approved to launch by regulators in Oregon, Virginia, Montana, and Minnesota, according to Massachusetts Gaming Commission (MGC) documents. The MGC heard Thursday that the app has also been approved in Colorado, Indiana, Washington, and West Virginia.
You can add Massachusetts to that list now as well, as the MGC approved DK HORSE on Thursday as an advance deposit wagering vendor for Suffolk Downs for pari-mutuel wagering purposes only. The approval came with the condition that if DK HORSE takes bets on greyhound racing in the state, it can only do so until August 1, after which it is no longer allowed in Massachusetts.
A familiar face
“We don't have any information that there are any issues with this provider,” said Alexandra Lightbown, the MGC’s director of racing. “And obviously, we have had the experience with the Churchill Downs infrastructure for years.”
The Suffolk Downs simulcast facility already has several other partners that offer advance deposit wagering on horse racing, including TwinSpires, which is providing its technology to DraftKings. The facility is eligible for a Massachusetts sports betting license as well.
DraftKings did not respond to questions from Covers before this article was published. However, the addition of horse racing to its repertoire is expected to broaden its reach and bolster its bottom line. In this, DraftKings is not alone, as it and other online sportsbook operators have recently embraced the sport of kings with similar efforts as they strive for profitability.
“We are excited to collaborate with Churchill Downs Incorporated, not only to give our existing customers an opportunity to engage with pari-mutuel horse wagering, but also to acquire new customers efficiently during marquee horse racing moments,” Jason Robins, CEO of DraftKings, said in a November press release. “Due to the structure of the agreement, we expect this new product offering to be immediately profitable.”
Partners in pari-mutuel
The MGC’s materials for its Thursday meeting contained more information about DK HORSE, including a presentation from Churchill Downs describing the relationship with DraftKings.
DK HORSE is set to use the same account creation and know-your-customer procedures as TwinSpires, and those processes will be managed and operated by Churchill Downs. The same will go for DK HORSE’s “wagering mechanisms,” the presentation notes.
Customer service functions such as live chat will also run through Churchill Downs. In short, Louisville-based CDI will be doing a lot of the heavy lifting behind the scenes, but the DraftKings branding and promotional efforts out front are intended to attract new customers.
“DK Horse is a full white label affiliate which will utilize the existing [Churchill Downs] technology platform to grant customers to U.S. and international horse racing content and wagering,” the presentation notes. “Via the partnership with CDTIC, DK Horse will bring the [CDI] platform and horse racing content to a new audience.”