Dream Sports, which owns and runs fantasy gaming startup Dream11, has set up a corporate venture fund with a corpus of USD 250 million as it looks to invest in startups across sports, gaming, and fitness. The move will help the Mumbai-based startup to diversify its operations beyond fantasy games.
The 13-year-old, Tiger Global-backed company is the largest gaming platform in India with a nearly USD 5 billion valuation. Aside from Dream11, which offers real money fantasy games across cricket, kabaddi, NBA, hockey, and football, it operates sports streaming platform Fancode, sports experiences platform DreamSetGo, and payment platform DreamPay, and sports accelerator DreamX.
Harsh Jain, co-founder and CEO of Dream Sports, said in an interview with local media Economic Times that the company will reinvest its earnings to grow inorganically through the fund.
“While organic growth continues, we don’t want to fall into that age-old trap of trying to do everything ourselves,” he said, adding that the idea behind the fund is “to build an overall sports technology ecosystem and back a whole host of startups through this initiative.”
Dream Sports will use the fund, dubbed Dream Capital, which is financed through the company’s balance sheet, to make minority investments as well as acquisitions. It will cut checks of USD 1 million or more and will have the ability to pump in as much as USD 100 million, Jain said.
Dream Capital is a result of learnings from previous investments, according to Jain. The company launched Dream Sports Investments, a corporate venture capital arm, last year to incubate and partner with high-growth startups in sports and gaming.
“We started this as an experiment with Dream Sports Investments—like the ones in FanCode and Dream Pay. We learned that we didn’t want to go after incubating too much and wanted to back entrepreneurs who had already dedicated a few years of their lives to solving a problem,” Jain said.
According to Dev Bajaj, managing director, Dream Capital, the fund is stage-agnostic, and unlike a typical VC, Dream Capital will offer entrepreneurs access to Dream Sports’ user base of 125 million, branding, and go-to-market strategy.
Over the next two years, Dream Capital plans to invest in about 15–20 startups that have the potential to achieve at least USD 100 million in annual revenue within five years.
Dream Capital has already acquired video game developer Rolocule and cut checks for eight companies, including e-sports platform SoStronk and sports footwear and equipment brand Elevar. Additionally, it plans to make follow-on investments in companies it has incubated under DreamX.
The fund has also backed global sports-tech venture capital firms to ensure that its portfolio companies have international opportunities.
“As a part of our global strategy, we have made investments in global sports and gaming funds. It is not a significant part of the present corpus, though,” Bajaj told local media Mint. He said the company is backing gaming-focused funds to ensure coverage in areas where it doesn’t have much expertise.
“However, our strategy is largely focused on Indian investments, as we focus on our global ambitions,” he added.