“We are going to become the biggest gambling company in the country.”
Those were the words of Barstool Sports founder Dave Portnoy during a video he posted announcing that gambling operator Penn National Gaming was purchasing a minority stake in Barstool. The deal values Barstool at $450 million, and allows for Penn to increase its stake to around 50% in three years, with further options to purchase the rest of the company, according to the Washington Post.
Penn National Gaming is hoping that the famously young and rabid Barstool audience will be a nice demographic to pitch its casinos and sports betting offerings to. Barstool has also stated they will open up their own branded casinos in association with Penn.
While Barstool can offer Penn its coveted millennial demographic, the fit between the two companies is not exactly clear.
Barstool CEO Erika Nardini was in Miami for Super Bowl 54 and spoke bluntly about the company she runs.
“We are a company that thrives on drama,” she said at a Dow Jones event overlooking Miami Beach. Can a company that thrives on drama be trusted with people’s money like a typical sportsbook?
Gaming companies are heavily regulated and always under the microscope. Look no further than the $1 million contest from DraftKings that recently ended with the forfeiture of winnings by “Bachelor” contestant Jade Roper Tolbert.
See also: When LeBron James chose Nike in 2003, he gave up $28 million — it could end up making him $1 billion
The appetite for sports betting continues to grow as twenty states (as well as Washington, D.C.) have passed legislation allowing legal sports betting, with more states likely to follow.
While Barstool seems to be excited about the deal with Penn, there may be some cause for concern. The aforementioned announcement video where Dave Portnoy claimed dominance over the gambling world was six minutes and 44 seconds long, and over half of the video was a disclaimer stating that Dave Portnoy’s thoughts and opinions in no way reflect those of Penn National Gaming.
Maybe Penn is at least a little worried about this partnership.
"company" - Google News
February 02, 2020 at 01:09AM
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Barstool Sports CEO: ‘We are a company that thrives on drama’ - MarketWatch
"company" - Google News
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