Startup Deep Dive : Dream11 — how one law erased 95% of its revenue overnight

In April 2019, Dream11 became India’s first fantasy-sports unicorn, riding a decade-long bet that Indians would pay real money to pick virtual cricket teams. By November 2021 it was worth $8 billion (reported), backed by Tiger Global, Tencent and TCV, and wearing the Indian cricket team’s jersey. Then, on 22 August 2025, a single act of Parliament made its core paid-contest business illegal, and by founder Harsh Jain’s own account, “overnight, 95% of our revenues disappeared.”

This is not a story about a startup that lost its way. Dream Sports, Dream11’s parent, posted a profit of ₹1,295 crore on ₹7,934 crore of revenue in FY24 — one of the most profitable consumer-internet businesses India had produced. It is a story about a company that built a legally sound, hugely popular, thoroughly taxed business, and then watched a regulator decide the entire category should not exist. What follows is what happened before that decision, what happened because of it, and what is verifiably known — and not known — about what comes next.

Quick facts

What Dream11 does

Dream11 lets users draft virtual teams of real cricket, football, kabaddi and basketball players ahead of a live match, then scores those teams on the players’ actual on-field performance. Historically its core product was paid contests: users paid an entry fee, pooled it with other entrants, and the platform paid out most of the pool to the best-performing teams while keeping a cut. That paid, real-money format is what built the business and what a 2025 law has since shut down; Dream11 now runs free-to-play contests, and its parent, Dream Sports, sells sports content and experiences through sister brands FanCode and DreamSetGo.

The origin

Harsh Jain grew up playing fantasy football while studying in the UK and the US and returned to India around the time the Indian Premier League launched in 2008. His insight, as he and co-founder Bhavit Sheth have recounted in founder interviews, was narrow but sharp: India had hundreds of millions of cricket fans and no fantasy-cricket product built for them. Jain took the product and growth side, Sheth ran operations, and the two spent their first four years failing to find a format that worked before a single change in 2012 turned the company around.

The struggle years

Between 2008 and 2012, Dream11 tried and abandoned several models: a season-long fantasy format that asked users to commit to a whole tournament up front, a free-to-play version funded by advertising, and a feature-heavy product that tried to be a sports social network as much as a game. None of it worked, and the founders have said they were turned down by more than 150 investors during this period. The company’s legal footing was also unsettled for years afterward: it took until 2017 for the Punjab and Haryana High Court to rule that Dream11’s format was a “game of skill” rather than gambling, and that finding was not fully closed off from further challenge until the Supreme Court dismissed a special leave petition against it on 30 July 2021, formally affirming the skill-game status that the Punjab and Haryana, Bombay and Rajasthan High Courts had each separately reached. In the years between, several states — including Assam, Odisha, Telangana and Andhra Pradesh — banned real-money gaming formats outright within their borders, and Dream11 briefly suspended operations in Karnataka in October 2021 after a state ban, resuming only after the Karnataka High Court struck the ban down in February 2022.

The turning point

The defining turning point was not a near-death moment from the early years — it was a piece of central legislation two decades into the industry’s life. On 22 August 2025, the Promotion and Regulation of Online Gaming Act, 2025 received presidential assent after clearing both houses of Parliament, prohibiting the offer, promotion or facilitation of any online money game in India. Dream11 stopped its paid contests within days, ahead of the Act’s formal enforcement, which the Ministry of Electronics and Information Technology later notified as taking effect from 1 May 2026. The numbers either side of that one law are stark: in FY24, Dream Sports had reported ₹7,934 crore in revenue and ₹1,295 crore in profit, built almost entirely on paid contests. Jain has said that “overnight, 95% of our revenues disappeared” once the ban took hold — a figure corroborated separately by reporting that the law eliminated about 95% of Dream11’s revenue and effectively all of its profit. Within weeks, Dream11 also ended its ₹358 crore (about $40.8 million), three-year title sponsorship of the Indian cricket team’s jersey, a deal it had signed in mid-2023 and was contracted to hold through March 2026; Apollo Tyres took over the rights soon after, with the Board of Control for Cricket in India seeking around ₹452 crore for the 2025-28 cycle.

The money behind it

Dream11’s capital story runs through a small set of global growth investors. Kalaari Capital and Think Investments backed the company early, and Chinese internet major Tencent came in as an early investor, holding a single-digit stake it did not sell down even as later rounds priced the company far higher. A secondary sale led by Steadview Capital in April 2019 made Dream11 India’s first fantasy-sports and gaming unicorn. In 2021, growth accelerated sharply: a round led by TCV, D1 Capital Partners and Falcon Edge took Dream Sports’ valuation to nearly $5 billion, and months later, in November 2021, an $840 million round led by Falcon Edge, DST Global, D1 Capital and RedBird Capital, with Tiger Global also participating, pushed the valuation to $8 billion — a figure reported at the time by both Inc42 and Outlook India, among others. That remains the last publicly confirmed valuation as of September 2026; no updated post-ban valuation has been disclosed. Fundraising trackers put Dream11’s total capital raised at roughly $1.2 billion across eight rounds, though Dream Sports itself has not published a consolidated lifetime figure.

How it makes money

Before the 2025 ban, Dream11’s economics were straightforward. Users paid an entry fee into a contest pool; the platform returned the large majority of that pool to winning entrants as prize money and kept the remainder as its fee — commonly cited in industry breakdowns as roughly a fifth of the pool, though Dream11 has not published an exact, audited take-rate figure. On top of entry fees, the company earned from sponsorships, advertising and a paid subscription tier. The part outsiders consistently underestimated was tax: from 1 October 2023, the government began levying 28% Goods and Services Tax on the full deposit or entry amount rather than only on the platform’s fee — so a user adding ₹100 to their wallet effectively had roughly ₹22 diverted to GST before any contest was played. Dream11 chose to absorb that hit rather than pass all of it to users, restructuring its wallet economics so that deposits were treated as inclusive of GST. It weathered that shock and still grew revenue and profit through FY24 — only for the ban that followed two years later to remove the entire deposit-based revenue line, not merely tax a slice of it.

The numbers

Figures below are Dream Sports’ consolidated results as reported from filings with India’s Registrar of Companies, in ₹ crore, for revenue from operations and profit/loss after tax.

The FY25 swing to a loss predates the August 2025 ban — it was driven by two one-off items: a ₹575 crore tax cost from a cross-border merger of Dream Sports Inc into Sporta Technologies, and ₹771 crore booked against director benefits, of which ₹778 crore sat inside a sharply higher ₹1,673 crore employee-expense line. Advertising and marketing spend still ran to ₹3,913 crore in FY25, about 58% of total costs — money spent defending a paid-contest business that would be outlawed within months of the financial year closing. Because Dream Sports’ FY26 results (covering the ban itself) were not yet public as of September 2026, the true post-ban revenue and profit picture cannot yet be verified and is not stated here.

Where the money comes from

Through FY25, essentially all of Dream Sports’ revenue and effectively all of its profit sat inside one segment: real-money fantasy contests on Dream11, overwhelmingly tied to cricket and concentrated around the Indian Premier League and international cricket calendar. A 2019 report by KPMG and the India Federation of Sports Gaming estimated Dream11 held around 90% of India’s domestic fantasy-sports market by that point, underlining how little diversification existed even before the ban. The surprise, for a company this large, is how thin everything outside fantasy cricket actually was: FanCode (sports content and streaming) and DreamSetGo (sports travel and experiences) existed well before 2025 but were sized as adjacencies, not alternatives. After the ban, Dream Sports restructured into eight semi-autonomous units — Dream11, FanCode, DreamSetGo, Dream Cricket, Dream Sports AI (which houses the Dream Play analytics app and the RushLine prediction tool), Dream Money, Dream Horizon and Dream Sports Foundation — each with its own chief executive and the ability to raise outside capital, with Dream Sports retaining majority ownership. That split is a public acknowledgement that no single one of those businesses yet earns anything close to what paid fantasy contests once did.

The risks

The first risk has already happened rather than merely threatened: outright prohibition. The Promotion and Regulation of Online Gaming Act, 2025 did not tax or cap real-money gaming, it banned it, with criminal penalties for operators; Dream11’s own 95% revenue-loss figure is the clearest illustration in Indian startup history of concentrated regulatory risk crystallising in a single event. The second is retrospective tax exposure that survives the ban. In October 2023, tax authorities had already served Dream11 with a demand of around ₹28,000 crore over alleged GST evasion tied to how entry amounts were taxed before the rate change; on 27 May 2026, the Supreme Court upheld the government’s position that 28% GST could be applied retrospectively to the full face value of bets, not just platform fees, a ruling reported to validate tax demands of close to ₹2.5 lakh crore across the online-gaming industry. That leaves Dream11 exposed to legacy tax liabilities on a business it can no longer legally operate to fund them. The third risk is execution: the eight new business units must each build a real revenue base from a standing start, in categories — sports content, travel, AI tools, fintech — where Dream Sports has far less proven pricing power than it had in fantasy cricket, and where more than 100 executives had already exited the restructured company as of its first months.

The takeaway

Dream11’s arc is a reminder that a business can be legally sound, popular, profitable and taxed at record rates, and still be ended by policy rather than by competition or a product failure. The company spent thirteen years building courtroom precedent that fantasy sports was a game of skill, not gambling — and that precedent still held in 2021. It did not matter, in the end, whether the product was legal in the narrow sense; what mattered was whether lawmakers wanted the category to exist at all. For any founder building a business that depends on a specific, contestable reading of the law, the lesson is not “get a favourable ruling” — Dream11 had one. It is that a single national policy reversal can outrun even a decade of legal wins, and that revenue built entirely on one regulatory interpretation is revenue that can disappear in a single sitting of Parliament.

Frequently asked questions

Is Dream11 banned in India?

Dream11’s real-money, paid-entry contests are banned. The Promotion and Regulation of Online Gaming Act, 2025, in force from 1 May 2026 after receiving presidential assent on 22 August 2025, prohibits offering online money games in India. Dream11 continues to run free-to-play contests.

How much money did Dream11 make before the ban?

In FY24 (year ended March 2024), parent company Dream Sports reported consolidated revenue of ₹7,934 crore and a profit of ₹1,295 crore, according to filings reported by Entrackr and corroborated by other business outlets.

What is Dream11 worth?

The last publicly reported valuation is $8 billion, set in November 2021 when Dream Sports raised $840 million from investors including Falcon Edge, DST Global, D1 Capital, RedBird Capital and Tiger Global. No confirmed valuation has been reported since the 2025 ban, so any current figure would be speculative.

Why did Dream11 exit its BCCI sponsorship?

Dream11 ended its ₹358 crore Indian cricket team jersey sponsorship, signed in 2023 and contracted through March 2026, shortly after the 2025 online gaming law passed, because it could no longer promote a real-money gaming brand. Apollo Tyres subsequently took over the rights.

What is Dream11 doing now?

Dream Sports has restructured into eight semi-autonomous units — Dream11 (now free-to-play), FanCode, DreamSetGo, Dream Cricket, Dream Sports AI, Dream Money, Dream Horizon and Dream Sports Foundation — each run by its own chief executive, as it tries to rebuild revenue outside real-money fantasy contests.

Sources

Figures are as of September 2026. Currency converted at $1 ≈ ₹96.0 as of 18 September 2026 (Trading Economics).

• Entrackr, “Dream11 posts Rs 6,384 Cr revenue and Rs 188 Cr PAT in FY23”, January 2024
• Entrackr (Fintrackr), “Dream11’s domicile and director benefits lead to Rs 479 Cr loss in FY25”, 2025
• BW Disrupt, “Dream11 Parent Posts Rs 479 Cr Loss In FY25 Amid Tax Hit, Director Benefits”, 2025
• Storyboard18, “Dream11 spends Rs 3,913 crore on advertising, logs Rs 479 crore loss”, 2025
• Inc42, “Dream Sports Raises $840 Mn At A Valuation Of $8 Bn”, November 2021
• Outlook India, “Dream11 Parent Raises $840 Million Funding From Falcon Edge, Now Valued At $8 Billion”, November 2021
• Storyboard18, “‘We will not challenge the law in court’, Harsh Jain, Dream11 CEO on RMG ban”, August 2025
• Outlook Business, “Dream Sports Splits into Eight Independent Start-Ups after Real-Money Gaming Ban”, 2025
• TechCrunch, “As India bans real-money games, Dream Sports, MPL start pulling the plug”, 21 August 2025
• SportsPro, “BCCI ends ‘US$40.8m’ Dream11 jersey sponsorship deal”, August 2025
• Business Standard, “BCCI hikes Indian cricket team jersey sponsorship rates after Dream11 exit”, September 2025
• The Week, “Team India sponsor Dream11 gets Rs 28,000-crore GST evasion notice”, October 2023
• CAclubindia, “28% GST Impact: Dream11 CEO Warns of Massive Shutdowns in Online Gaming Sector”, October 2023
• Medianama, “Supreme Court: Challenge against fantasy sports platform Dream11 fails”, August 2021
• Inc42, “Dream11 Sets The Revenue Pace In India’s Fantasy Sports Gaming Market” (citing KPMG–IFSG report), 2019
• Inc42, “Dream11 Becomes India’s First Gaming Unicorn With Investment From Steadview Capital”, April 2019
• ASGAM, “India’s Supreme Court rules skill games as gambling, enforces retrospective 28% GST on full value of bets placed rather than on GGR”, 28 May 2026
• Outlook Respawn, “India’s Supreme Court Delivered the Final Blow to Real-Money Gaming”, 2026
• SCC Online, “MeitY notified enforcement of Promotion and Regulation of Online Gaming Act, 2025”, April 2026
• ANI, “Promotion and Regulation of Online Gaming Act 2025 to take effect from May 1”, April 2026
• Entrackr, “Dream Sports restructures business as over 100 executives exit”, 2025/2026
• Wikipedia, “Dream11”, accessed September 2026

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