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DraftKings CEO Weighs in on Trading vs Gambling Argument
DraftKings CEO Johnson Robins has discussed the potential of mobile betting, the Robinhood saga, and pent-up demand for sports with CNBC’s Power Launch host.
Robins Says Trading and Gambling Are Different Products
Last week, DraftKings CEO Johnson Robins spoke to CNBC’s Power Lunch and discussed whether the recent trading saga with GameStop has made more people inclined to equate trading with gambling. In essence, the host asked whether Robins saw Robinhood as a competitor.
“I don’t see them as a competitor,” Robins responded right away. Robins did acknowledge that there are similar dynamics, but only to the extent where personal use outweighed intended purpose.
If someone treats trading like a form of gambling, this is not inherent proof that trading is gambling. “We don’t see it as competition,” the CEO reiterated, arguing that trading and gambling are two completely separate products.
Robins also took a question about whether the pandemic had driven stronger-than-usual results and whether the fact that people had disposable income and few entertainment options had contributed to DraftKings’ recent buoyancy in terms of finances.
The chief executive explained that this had been factored in and that at the most recent earnings call, everyone did exercise a bit of conservatism in terms of guidance and outlook for the next financial year.
Pinpointing the Growth Dynamics in Sports Gambling
“There may be some softening of the tailwind,” Robins said and continued to explain that it was hard to determine what drove the momentum. He said that the company and the industry, in general, had taught how to optimize and market what he called a “hard-marketing product.”
And yes, Robins did say that his company and he acknowledged that a “good chunk of it was coming from this pent-up demand with no sports in Q2,” and of course, acknowledging that leisurely expenditures such as dining out and traveling had gone down.
The host did ask another interesting question touching on mobile sports’ nature and citing Illinois’ recent expansion to remote, mobile signup as a guiding point. She specifically asked Robins what his advice would be to states that are only now considering the legalization of sports betting – some 20 according to the host – about the potential of mobile betting.
“The vast majority of the betting handle is generated on mobile,” Robins said, even before the pandemic. States are now noticing that, and every state that is now considering sports betting acknowledge the importance of bringing mobile products online, Robins added.
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