How an Esports Startup Secured $20 Million by Reframing Its Pitch During the AI Investment Boom

In a venture capital market heavily dominated by artificial intelligence investments, securing funding for a non-AI startup has become increasingly difficult. Yet Lucra Sports founder and CEO Dylan Robbins managed to do exactly that, raising a $20 million Series B round led by the ARK Invest Venture Fund, marking the first time Cathie Wood’s venture fund has taken a lead role in a startup financing round.

The funding announcement came last month and included participation from several venture capital firms alongside ARK. The achievement is particularly notable given ARK’s previous experience with skill-based gaming company Skillz, an investment that ultimately resulted in losses after the firm exited its position.

Lucra Sports operates in a different segment of the gaming market. Rather than developing traditional esports platforms, the company provides white-label interactive gaming competitions for businesses seeking new ways to engage customers. Instead of relying on conventional loyalty programs that reward users with discounts or points, Lucra enables companies to offer tournaments, contests, and friendly wagering experiences tied to games and recreational activities.

The company’s client roster includes brands such as Five Iron Golf, Dave & Buster’s, and Chess King, all of which use Lucra’s platform to increase customer participation and engagement.

According to Robbins, two key lessons played a major role in helping the company secure funding despite challenging market conditions.

The first lesson was the importance of building relationships everywhere and with everyone. The connection that eventually led to ARK’s involvement began unexpectedly during a casual game of darts at a bar in New York City.

Robbins recalled meeting another player and enjoying a few rounds together before parting ways. Several months later, the two crossed paths again at the same venue. During their conversation, Robbins learned that the individual worked at ARK Invest. After discussing Lucra’s business, the contact introduced him to ARK’s investment team, which later participated in the company’s earlier Series A funding round.

For Robbins, the experience reinforced the value of networking and maintaining positive relationships, regardless of the setting.

The second lesson emerged during Lucra’s efforts to raise capital at the end of 2025, a period when artificial intelligence dominated venture capital conversations. Many investors were focusing almost exclusively on AI startups, making fundraising particularly difficult for companies operating in other sectors.

Robbins said numerous meetings ended almost immediately when investors revealed they were only interested in AI opportunities. Some declined to hear the full presentation, while others made their decision after learning that Lucra was not building AI models, agents, or related technologies.

Faced with repeated rejections, Robbins adjusted the company’s fundraising narrative. Rather than avoiding the AI conversation, he incorporated it into the opening stages of his pitch.

The revised presentation argued that if AI technologies successfully increase productivity and automate routine work, people will likely have more free time to spend on entertainment and social gaming experiences—creating additional demand for Lucra’s services. Conversely, if AI investment expectations fail to materialise, businesses outside the AI sector could become attractive alternatives for investors seeking diversification.

The strategy resonated with a smaller group of investors willing to consider opportunities beyond core AI technologies. ARK became one of those supporters and ultimately led the funding round. After committing capital, the firm also helped introduce Lucra to additional investors who joined the financing.

While the AI-focused narrative helped open doors, Robbins emphasised that strong business performance remained the foundation of the fundraising effort. The company showed steady year-over-year growth and continued to expand in its niche market, giving investors evidence of sustainable momentum.

Another lesson Robbins encountered during fundraising was the importance of presenting an ambitious long-term vision. Venture capital firms often seek companies capable of addressing enormous markets, and Lucra positioned itself accordingly.

The company views its potential market as far larger than competitive gaming alone. Robbins argues that the opportunity encompasses anyone who participates in games or recreational competitions, ranging from pickleball and golf to online word games and casual challenges among friends. In that view, the addressable audience spans a significant portion of the adult population.

Despite those ambitions, Robbins still received feedback from some investors suggesting the company’s total addressable market was not large enough or that its projected growth trajectory lacked sufficient scale. One rejection stood out enough that he printed it and displayed it as a reminder.

The experience ultimately encouraged him to think even more aggressively about Lucra’s future opportunities and the scale required to attract venture capital backing.

For Robbins, raising the $20 million round demonstrated that even in an environment dominated by artificial intelligence investments, startups outside the AI sector can still attract major investors—provided they combine strong business fundamentals, strategic storytelling, and a vision large enough to capture attention in an increasingly competitive funding landscape.