Social gaming and online fan community developer Watercooler Inc. secured $5.5 million in Series B funding led by British online gambling business Betfair, which added its U.S. president Gerard Cunningham to Watercooler's board of directors. Existing investor Canaan Partners, which contributed $4 million to the company in May 2008, also took part in the round.
Watercooler will devote its new financing toward further development of its fantasy sports and social games on Facebook and other platforms. Based in Mountain View, CA, the company has so far attracted more than 26 million users since setting up shop in late 2006.
Its most recently launched product, FanSection Fantasy Football 2009, is a "commissioner-style fantasy football game" available on Facebook, where it's picked up more than 300,000 users (as of last August). Watercooler also claims its 2009 Bracket Challenge application was "the largest college basketball tournament game on Facebook" with over 1.7 million active users.
While this investment gives the legal online betting company a significant stake in Watercooler, it's unlikely Betfair will introduce gambling features to these social network games/applications, as Facebook does not allow for gambling on its site. Betfair, however, still views this financing as a tremendous opportunity" to build its "global portfolio of sports and social media offerings.
"At Watercooler, we've already achieved fantastic momentum in the social gaming space on Facebook, and we look forward to continuing along that path with the new investment from Betfair and Canaan," says Watercooler CEO Kevin Chou. "Betfair's innovative approach to sports and gaming, along with its strong international presence, made the company a perfect fit as we continue to build innovative social games."