Robbins, Other DraftKings Founders Taking $1 Salaries for Rest of 2021
Posted on: March 8, 2021, 09:21h.
Last updated on: March 8, 2021, 12:50h.
DraftKings (NASDAQ:DKNG) founders Matthew Kalish, Paul Liberman, and Jason Robbins are working cheaply this year.
A recent Form 8-K filing with the Securities and Exchange Commission (SEC) reveals the three executives will make base salaries of $1 for the remainder of this year, effective March 1.
“The salary reductions will not modify any other rights under each officer’s employment agreement that are determined by reference to the officer’s base salary; such provisions will continue to be applied based on the base salary rate in effect prior to the reduction,” according to the 8-K. “Additionally, these reductions are not intended to reduce any Company-employee benefit provided to Robins, Kalish, and Liberman that is determined by reference to base salary, except that life and disability insurance will not be provided to Messrs. Robins, Kalish, and Liberman during the salary reduction period.”
CEO Robbins got the ball rolling in March followed by President Kalish the next day. Liberman, the gaming company’s president of global technology and product, joined the party on March 4.
DraftKings Execs Not Hurting
With DraftKings stock up almost 28 percent year-to-date and higher by nearly 232 percent over the past year, the aforementioned executives aren’t being pinched by taking $1 salaries for the remainder of 2021.
As of Jan. 23, Robbins, Kalish, and Liberman combined to own approximately 9.5 million shares of the daily fantasy sports (DFS) provider’s common stock equity. Robbins also owns more than 90 percent of the company’s Class B stock, which carries with it 10 votes per share compared to the single vote assigned to each of the more common Class A equity.
With DraftKings’ market capitalization of $24.62 billion, Robbins’ net worth is estimated to be around $400 million.
The Boston-based sportsbook operator went public last April following a reverse merger with a special purpose acquisition company (SPAC). Since then, DraftKings became a favorite of Wall Street analysts and professional investors alike, due in large part to the rapid growth of the US sports betting market.
DraftKings History, Evolution
Former Vistaprint employees Kalish, Liberman, and Robbins started DraftKings in 2012 from Liberman’s Massachusetts home. That was three years after rival FanDuel burst onto the scene. The company started with a one-on-one baseball game. In 2013, it landed an investment from Major League Baseball (MLB).
For years, DraftKings’ bread and butter were DFS. But that changed following the 2018 Supreme Court ruling on the Professional and Amateur Sports Protection Act (PAPSA).
While the company, along with FanDuel, remains a DFS giant, investors today primarily view it through the lenses of iGaming and sports wagering — segments growing more rapidly than DFS.
DraftKings offers sports wagering in 13 states, covering about a third of the US population. But it’s currently limited to brick-and-mortar sportsbooks in Mississippi and New York.
The company holds an investor day tomorrow, with analysts speculating executives will address topics such as total addressable market and merger and acquisition opportunities.
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