Online lottery platform Jackpot has raised $35 million from a powerful list of sports owners, athletes and investors.
The Series A was co-led by Courtside Ventures, the VC fund backed by Cleveland Cavaliers owner Dan Gilbert; and by Accomplice, an early DraftKings investor. Others in the round include Fanatics CEO Michael Rubin, Arctos Sports Partners, the Kraft Group, DraftKings CEO Jason Robins, Sapphire Sport, NBA stars James Harden and Joel Embiid, and groups connected to the owners of the Cleveland Browns and Los Angeles Dodgers.
Jackpot is hoping to capitalize on a U.S. lottery market estimated to be $100 billion—far bigger than the market for sports betting or live event ticketing—but currently conducted almost entirely via physical stores. Last year 53% of Americans purchased lottery tickets, the company says, with online sales representing roughly 5% of those transactions.
“Millions of Americans are playing the lottery every day, and Jackpot will now make the experience even better for consumers,” Courtside Ventures partner Deepen Parikh said in a statement. “We’re excited to work with the team at Jackpot to revolutionize this massive industry.”
Jackpot’s valuation in the round was not announced.
Based in the U.K., Jackpot operates in a handful of European markets, allowing lottery commissions to offer tickets online. It is looking to grow its business in America, where a handful of states have legalized the sale of online lottery tickets delivered digitally. They include Texas, New York, Ohio and New Jersey, which together represent about 21% of the U.S. population.
Last month Jackpot hired Akshay Khanna, a former StubHub executive, to be CEO of its North American business. Khanna called it “Uber Eats for lottery tickets”—a service provider that allows tickets to be ordered online and delivered digitally.
Online lottery is a nascent industry, but a handful of companies are rushing grab market share as the opportunity grows. That likely means sports leagues and teams will play a central role in the marketing—as we’ve seen in the past few years for gambling and cryptocurrency platforms. Jackpocket, a Jackpot competitor, has already inked a few of these online lottery deals, most recently with MLB’s Colorado Rockies.
A cap table that features owners in all five major U.S. leagues should help Jackpot in those endeavors as well. The company is planning to launch in the U.S. later this year.
Jackpot Series A Investors
Courtside Ventures*, VC firm backed by Cleveland Cavaliers owner Dan Gilbert
Accomplice*, VC firm
Fanatics CEO Michael Rubin
DraftKings CEO Jason Robins
Elysian Park Ventures, backed by the owners of the Los Angeles Dodgers
Arctos Sports Partners, PE firm with equity stakes across the NBA, NHL, MLS and MLB
Haslam Sports Group, owners of the Cleveland Browns and the Columbus Crew
The Kraft Group, owners of the New England Patriots
Sapphire Sport, fund whose backers include City Football Group, the Boston Bruins and the New York Jets
Fenway Sports Group president Mike Gordon
Boston Red Sox president and CEO Sam Kennedy
NBA player James Harden
NBA player Joel Embiid
Former NHL player Martin Brodeur
Rapper Lil Baby
* – co-leads