Novig vs DraftKings

In 2021, Harvard undergraduate Jacob Fortinsky was earning serious profits as a quantitative sharp bettor — until traditional sportsbooks like DraftKings and FanDuel systematically limited his account stakes to pennies. Frustrated by an industry that bans winning customers while charging 8% to 10% hidden house margins (vigorish), Fortinsky teamed up with his computer science classmate Kelechi Ukah to eliminate the house entirely. Their premise was simple: build an institutional-grade financial exchange where sports fans trade spreads and totals directly against each other. After joining Y Combinator's Summer 2022 batch, Novig raised a $6.4 million seed round in August 2023 backed by YC founder Paul Graham, NFL legend Joe Montana, and Lux Capital, laying the engineering groundwork for a zero-commission order book.

Novig's path to scale was defined by rapid regulatory pivots. The company initially launched in early 2024 as a state-licensed sportsbook in Colorado, but quickly recognized that state-by-state sports betting licenses were too slow and capital-intensive. In September 2024, Novig radically restructured into a dual-currency sweepstakes platform utilizing "Novig Coins" and "Novig Cash," allowing it to instantly expand across 40 U.S. states, including non-sportsbook giant markets like Texas and California. Trading volume exploded 50-fold, attracting an $18 million Series A led by Forerunner Ventures in August 2025. However, as state attorneys general began launching aggressive legal crackdowns on sweepstakes gambling in late 2025, shutting down operations in New York and New Jersey, Novig faced an existential crisis that threatened to erase its state-level access.

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DraftKings was founded in December 2011 by Jason Robins, Matt Kalish, and Paul Liberman — three former Vistaprint colleagues who quit their jobs and started building from Paul Liberman's spare bedroom in Watertown, Massachusetts. Their first product was a one-on-one baseball contest launched on Opening Day 2012 with $100 prizes. The idea was to compress season-long fantasy sports into a single day: draft a new team every contest, win or lose in hours rather than months. Major League Baseball invested within a year — the first US professional sports league to back a daily fantasy company, a signal that DraftKings was not a fringe product. By 2014, the platform had one million registered users. By 2015, DraftKings and rival FanDuel were spending $750 million combined on television advertising in a single football season, flooding every commercial break with green-and-black branding. The spend was unsustainable. The business model was about to face a different kind of threat.

The attorney general investigations of 2015 nearly killed daily fantasy sports as a legal category. New York, Illinois, and Texas challenged DFS as illegal gambling. DraftKings survived — the legal arguments held — but the experience forced the company to build compliance infrastructure that would later become its competitive advantage. The 2018 Supreme Court ruling striking down PASPA transformed that infrastructure into a license-printing machine. DraftKings launched the first mobile sportsbook in New Jersey within months of the ruling, using its DFS customer database, brand recognition, and state-by-state regulatory experience to outrun competitors who had to start from scratch. By 2020, DraftKings went public via a SPAC merger with Diamond Eagle Acquisition Corp and SBTech, a turnkey sports betting technology provider, raising the capital to scale nationally. By 2024, DraftKings and FanDuel controlled 80% of the US online sports betting market. Revenue reached $4.77 billion. The company finally delivered the profitability it had been promising investors for four years.

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