Underdog Fantasy was valued at $1.225 billion in its $100M Series C funding round in early 2025, nearly tripling its previous $485 million valuation from July 2022. Notable investors in Underdog Fantasy include BlackRock, Acies Investment, Mark Cuban, and Kevin Durant.

Underdog Fantasy was founded in 2020 by Jeremy Levine, Brandon Stakenborg, and Trevor John, bringing together expertise from previous fantasy sports ventures including StarStreet and DRAFT.

Underdog found product-market fit as an innovative fantasy sports platform for sports enthusiasts seeking more engaging and less time-consuming alternatives to traditional season-long fantasy leagues. Their flagship Best Ball tournaments eliminated the need for weekly lineup management while maintaining the excitement of drafting and following players throughout a season.

The platform offers three core products: Best Ball tournaments, Pick'em contests, and a recently launched sportsbook. In Best Ball, users draft a team once before the season, with the platform automatically selecting optimal lineups each week based on player performance. Top-scoring teams advance through tournament rounds competing for substantial prize pools.

Pick'em contests allow users to predict individual player statistical performances by selecting "higher" or "lower" than projected lines. These selections can be combined into multi-leg entries similar to parlays, with all selections needing to be correct to win.

Underdog Fantasy is a fantasy sports and sports betting platform that generates revenue primarily through contest fees, taking approximately 10-15% of entry fees for fantasy contests and tournaments.

The company offers several distinct product lines. Its flagship product is Best Ball tournaments, where users draft teams at the beginning of a season with no ongoing management required. The platform automatically selects optimal lineups each week, with teams advancing through tournament rounds to compete for substantial cash prizes like the $15 million prize pool for Best Ball Mania.

Underdog's Pick'em contests allow users to predict individual player performance by selecting "Higher" or "Lower" than projected statistical lines. These can be combined into 2-5 leg entries similar to parlays, with payouts increasing with more selections. The company builds in a house advantage on these contests as a revenue stream.

In March 2024, Underdog expanded into traditional sports betting with the launch of its sportsbook in North Carolina. Unlike many competitors who use white-label solutions, Underdog built proprietary technology for its sportsbook, which offers traditional betting markets and integrates with existing fantasy accounts.

Underdog Fantasy operates in a market that includes traditional fantasy sports platforms, daily fantasy sports (DFS) operators, player prop betting sites, and full-service sportsbooks.

ESPN Fantasy and Yahoo Fantasy dominate the traditional season-long fantasy sports market with their established platforms and extensive user bases. These companies offer free-to-play leagues with optional premium features but lack the daily engagement and prize structures that Underdog specializes in.

DraftKings and FanDuel represent the largest competitors in the daily fantasy sports space, with massive user bases and marketing budgets. Both companies have expanded beyond their DFS roots into full sportsbook operations, creating comprehensive sports betting ecosystems. Unlike Underdog, these companies rely heavily on white-label technology solutions rather than proprietary platforms.

Sleeper has carved out a niche with its social-focused fantasy platform, emphasizing user engagement through in-app chat features and simplified gameplay. With significant venture funding and a rapidly growing user base, Sleeper targets a similar demographic to Underdog but focuses more on season-long engagement than daily contests.

PrizePicks stands as Underdog's most direct competitor in the player prop pick'em space. Both companies offer similar products allowing users to predict player statistical performances. PrizePicks has faced similar regulatory challenges to Underdog regarding the classification of these contests as skill games versus betting.

Monkey Knife Fight (acquired by Bally's) pioneered the player prop fantasy format but has lost market share to newer entrants like Underdog and PrizePicks. Several smaller competitors including Boom, Chalkboard, Dabble, FanUp, and ParlayPlay have entered this segment with varying degrees of success.

With its March 2024 launch in North Carolina, Underdog now competes directly with established sportsbooks including DraftKings Sportsbook, FanDuel Sportsbook, BetMGM, Caesars Sportsbook, and ESPN BET. These operators offer comprehensive betting markets across all major sports with substantial marketing budgets and established brand recognition.

The sportsbook market is characterized by high customer acquisition costs and increasingly sophisticated product offerings. Underdog's proprietary technology platform represents a potential advantage against competitors using white-label solutions, potentially enabling faster innovation and unique betting products.

The competitive landscape is further complicated by regulatory challenges, with state-by-state regulations creating a patchwork of markets with different legal requirements. This regulatory environment has led to industry consolidation, with smaller operators struggling to manage compliance costs across multiple jurisdictions.

Underdog Fantasy has tailwinds from the rapid growth of the fantasy sports market, legalization of sports betting across the US, and increasing digital engagement with sports. The company has the opportunity to grow and expand into adjacent markets like traditional sports betting, international fantasy sports, and sports media/content.

Underdog's recent expansion into traditional sports betting with its March 2024 North Carolina launch represents its most significant growth vector. The US sports betting market is projected to reach $40-50 billion at maturity, dwarfing the fantasy sports market.

Unlike competitors who use white-label solutions, Underdog built proprietary technology for its sportsbook. This gives them flexibility to create innovative betting products that bridge fantasy and traditional betting experiences.

The company's existing user base of fantasy players provides a natural customer acquisition funnel for sports betting. Fantasy players convert to sports bettors at higher rates and with lower acquisition costs than general audiences.

Underdog can leverage its $1.23 billion valuation to secure market access deals in additional states beyond North Carolina. Each new state represents a substantial revenue opportunity.

The fantasy sports model has proven successful in North America but remains underpenetrated globally. International markets represent a significant growth opportunity.

Soccer (football) is the world's most popular sport but lacks innovative fantasy products like Underdog's Best Ball tournaments. Adapting Underdog's fantasy formats for soccer could unlock massive European, Latin American, and Asian markets.

The company's Pick'em product is particularly well-suited for international expansion as it works across all major sports and requires minimal localization beyond language.

Underdog can expand beyond gaming into sports media and content, similar to how DraftKings acquired VSiN and FanDuel launched its own content network.

The company's fantasy contests and betting products generate valuable data on player preferences and engagement patterns. This data can inform original content creation tailored to specific user segments.

Underdog could develop premium subscription content services for fantasy players, creating a recurring revenue stream beyond transaction fees. Analysis tools, advanced statistics, and premium content would complement their existing product suite.

By building a comprehensive sports engagement platform spanning fantasy, betting, and content, Underdog can increase customer lifetime value and reduce reliance on seasonal revenue patterns tied to the NFL calendar.

Regulatory uncertainty in the pick'em market: Underdog's Pick'em product has already faced significant regulatory challenges, including a $17.5 million settlement with New York. As more states scrutinize whether these contests constitute gambling rather than games of skill, Underdog could face additional fines, market restrictions, or forced product modifications that would severely impact a core revenue stream.

Seasonal revenue concentration: Underdog's business is heavily dependent on the NFL season, with revenue reportedly doubling within a single month during peak periods. This seasonal concentration creates cash flow vulnerabilities and operational challenges, particularly as the company scales its workforce and infrastructure to support its expansion into traditional sports betting.

Established competitor response: As Underdog expands into traditional sports betting, incumbents like DraftKings and FanDuel (with their massive marketing budgets and established user bases) could aggressively counter by launching similar Best Ball tournaments and Pick'em contests, potentially neutralizing Underdog's key differentiators while leveraging their scale advantages.