Lucra Sports secures $20m Series B led by ARK Invest by pivoting pitch to AI hedge
Founder Dylan Robbins overcomes investor scepticism and the fund’s prior losses in the sector by framing the company’s growth as a diversification play against the AI boom.
Lucra Sports, an eSports startup founded by Dylan Robbins, has closed a $20 million Series B funding round led by Cathie Wood’s ARK Invest Venture Fund. The investment marks a significant deviation from the current venture capital landscape, where capital is heavily concentrated in artificial intelligence. The round, which includes participation from several other venture capital firms, positions Lucra to expand its white-label interactive gaming competitions for consumer brands such as Five Iron Golf, Dave & Buster’s, and Chess King.
The decision by ARK Invest to lead the round is notable given the fund’s historical exposure to the sector. ARK previously invested heavily in Skillz, a skill-based gaming platform, before divesting at a loss. Despite this precedent and the prevailing market preference for AI-focused startups, Robbins successfully attracted the fund by leveraging a combination of personal networking and a reframed investment thesis.
The initial connection with ARK was established through a chance encounter at a New York darts bar, where Robbins met an employee who later introduced him to the investment team. This relationship resulted in a Series A investment and provided the foundation for the subsequent Series B. Robbins emphasised the importance of maintaining professional relationships, noting that the casual interaction eventually led to formal introductions that facilitated the company’s fundraising journey.
Robbins secured the lead investment during a period of intense competition for AI-related startups, which he described as "peak AI mayhem." He reported that one in three investor calls was rejected outright due to a lack of AI focus, with some investors refusing to hear the pitch. To counter this, Robbins adjusted his presentation to frame Lucra’s business model as a hedge against AI adoption. He argued that if AI succeeds, it will generate more leisure time for gaming, benefiting Lucra; if it fails, the company represents a smart non-AI diversification.
Underpinning the pitch were metrics of consistent year-over-year growth rather than isolated spikes. Robbins also highlighted the company’s expansion into mini-game development through a recent investment in a development partner. He noted that while some investors cited a total addressable market (TAM) covering Americans aged 18 to 70 as too small, he viewed this as motivation to aim for larger valuations. The final round was completed with ARK facilitating introductions to additional investors to fill the remaining capital requirements.
