The fantasy sports company has announced that if its sale of the business to Paddy Power Betfair goes through that they plan to use that cash to support other Scottish tech businesses. FanDuel’s five founders, who have all exited the business over the past two years, are set to receive a considerable lump sum of cash as they all retain large shareholdings in the company.

Although the terms of the sale have yet to be disclosed it is likely that the company will fetch a hefty sum of at least several million dollars. The bulk of this will go to the company’s private equity owners, of whom Kohlberg Kravis Roberts has the largest shareholding, with around a quarter of the firm now owned by a group of early investors.

This group includes co-founders Lesley Eccles, Tom Griffiths, Rob Jones and Chris Stafford. The Scottish Investment Bank, Pentech Ventures and angel investor Simon Murdoch are also part of this group.

Former, Chief Executive Nick Eccles has said:

“The co-founders have already been investing their time and money in other companies. There are some great start-ups coming through Edinburgh right now and I’d love to be an angel investor in them.”

“The other founders feel similarly that they would like to invest in some of those. I’m super excited about Edinburgh -it’s transformed in the last eight years.”

US Supreme Court Rule Betting Ban Unconstitutional

Recently, FanDuel’s value has slipped due to US gambling regulatory issues, which saw a ban on sports betting in most states. Despite being Edinburgh based, most of the company’s revenues are generated in the US.

However, a judgment handed down this week in the US Supreme Court found that a ban on sports betting in the state of New Jersey was unconstitutional. This has removed a huge obstacle for the company and opened the market to betting businesses like Paddy Power Betfair. This move is likely to bolster the valuation of FanDuel.

Market analysts predict that the ruling will pave the way for US bookmakers to expand operations across the country. With almost 20 other states ready to follow suit, this presents a unique opportunity for major UK sports bookmakers to grab a share of the US betting market. The acquisition of FanDuel would allow Paddy Power Betfair to rapidly scale up its US operations to take advantage of this market opening.