In the run-up to Indian Premier League 2020, which is expected to begin at the end of March, Mumbai-based fantasy gaming startup Dream11 is now raising fresh funds. The company is said to be on the verge of nearly doubling its valuation as Tiger Global looks to become its latest investor.
Dream11 is speculated to be raising $500 Mn in funding, which will be led by Tiger Global. An unconfirmed report said that Tiger Global will acquire new shares and also secondary shares from Dream11’s existing investors such as Kalaari Capital, Think Investment and private equity firm Multiples.
Tiger could spend as much as $200 million to buy new shares as well as shares from Dream11’s early investors Kalaari Capital, Think Investment and private equity firm Multiples at a valuation of $2.5 billion. With this investment, Dream11 will be worth more than double its $1.1 billion valuation in April 2019. The company is working with investment bank Credit Suisse for the fundraising.
Founded by Harsh Jain and Bhavit Sheth in 2012, Dream11 offers games such as cricket, kabaddi, and football, where users can win money from a reward pool, depending on the players they pick and the actual outcome of the game.
In April 2019, Dream11 was valued at $1.1 billion, making it the first Indian gaming company to join the Unicorn club after London-based Steadview Capital invested $60 million in the company through a secondary market transaction. The company was valued at $700 million in September 2018, when it raised $100 million from the Chinese internet giant Tencent.
Dream11 is the official fantasy gaming partner of various leagues and tournaments like ICC, IPL, ISL, Pro Kabaddi League, and Big Bash League.
In April 2019, Bombay High Court passed an order stating that the company’s gaming format is skill-based and thus is not gambling and is protected by the Constitution as a legitimate business. It even approved the company’s manner of payment of Goods and Services Tax (GST), relying on a 2017 Punjab and Haryana High Court decision and other Supreme Court precedents.
Dream11 also aims to build out its platform as a full-fledged sports platform selling merchandise. It has emerged as one of the fastest-growing tech startups in India, driven by a lack of competition in the space, a large user base and avid following of sports, especially cricket. Dream11 had about 50 million subscribers in February last year, which is said to have doubled by the end of the year.