I’m sorry did someone say there was a recession? Judging by the $5.5 Million dollars that Watercooler just raised, you would never know it. Last year, Watercooler’s March Madness game on Facebook had over 1.7 million active users, instantly making it a major player in the world of (social) fantasy sports, and now it has a war chest to take the company to the next level.

If there is an immature market in the fantasy industry, it is within social networks. While fantasy players are well-entrenched in their habits, Facebook holds the potential to be a game changer in the fantasy industry. Over 100 million Facebook users actively socialize online, and it is only natural to transition these users to socializing over fantasy sports within their already existing networks. However, none of the big fantasy sites have made a major shift to making their games fully accessible via Facebook, which creates a big opportunity for new fantasy sites to become major players. Currently, this companies that have entrenched themselves in this niche is Watercooler and Citizen Sports.

One item of concern about this funding arrangement is that the $5.5M funding round was lead by online gambling site Betfair. From a legal perspective, there is a thin line between fantasy sports and gambling. I think it is not worth blurring that line, but that is just personal preference. The two can legally coexist, and Watercooler seems up to the challenge.

Congratulations to Watercooler on its new piggy bank, and I look forward to seeing how it spends its money.

Additional Coverage:

• Watercooler Inc. Announces $5.5 Million Series B Funding Led by Strategic Corporate Investor Betfair (Press Release)
• Watercooler raises $5.5M to expand social fantasy sports game business (VentureBeat)