Meredith McPherron, CEO and managing partner at Drive by DraftKings, believes economic downturns demand a cautious financial strategy.
Speaking at the NEXT Summit New York 2025, she shared her perspective on market volatility, the psychology of risk, and how uncertainty is shaping both venture capital and sports betting.
“It is a daunting environment, no doubt,” McPherron, who heads the multi-stage venture capital firm, said.
“Uncertainty is really hard for markets. It’s really hard for venture. Oftentimes, it starts in the public markets, and then there’s a line effect. When there’s talk about a recession, it moves through the full arc of investment.”
Her remarks came amid growing fears of a US recession, which has recently sent stocks — including those of gambling companies — lower. Economic analysts have warned that risks are rising.
To weather uncertain times, McPherron emphasised the importance of discipline, particularly when managing portfolio companies.
“We think carefully about these periods. On the conservative side, we focus on cash conservation to make it through,” she explained.
Yet, she also struck an optimistic tone, noting that economic downturns have historically been fertile ground for innovation.
“A lot of great companies were built in uncertain times. They’re forced to prototype, prioritise, and sharpen their focus,” she said. “So when I look ahead, I think we’re in a really strong, resilient space.”
McPherron was joined on stage by Akshay Khanna, co-founder and CEO of Jackpot.com; Jeremy Levine, CEO of Underdog; and Justin Park, co-founder of Betty and Edgar. The panel was moderated by CNBC correspondent Contessa Brewer.
Do people really want to win every time?
Shifting the conversation to sports betting, the panel explored a counterintuitive idea: do players actually want to win all the time?
Betty co-founder Justin Park argued that the unpredictability is what makes gambling exciting.
“If you win every single time, is that really fun?” he asked. “I don’t think so.”
“Part of the thrill comes from the adrenaline rush,” Jackpot.com CEO Khanna agreed. If a player knew he or she were always going to win, the heart rate wouldn’t rise, he said.
That rush, that uncertainty — it’s part of the experience, he argued, in addition to the money you win or lose.
McPherron echoed this sentiment, revealing that she had conducted an informal survey on the subject.
“I was curious about the love of losing versus the love of winning,” she said.
“What came through from young people was that the fear of losing makes for a high engagement factor, even though they know it’s just entertainment.”
“The fear of losing was the bigger driver than the joy of winning.”
A word on prediction markets
McPherron also discussed the growing role of prediction markets and skill-based gaming.
Prediction markets are engaging because they tap into our competitive instincts, she suggested.
However, she pointed out that prediction markets operate in a binary fashion — either you’re right or wrong — whereas much of the sports betting world has moved toward parlays, which allow for multiple bets in a single wager.
“So, the question is how big is the market with regard to the high hold areas. I think it’s relatively small,” she said.
Cautious optimism for 2025
Despite economic headwinds, McPherron remains confident in the resilience of the gaming and entertainment industries.
“In both good times and hard times, people turn to entertainment to find joy and connect with a community,” she said.
“So, while we’re cognisant of the uncertainty, we’re not afraid of it.”
