In a move that’s stirring up the sports betting landscape, Barstool Sports is on the brink of entering a significant marketing agreement with DraftKings, a leader in the digital sports entertainment and gaming industry. This partnership is poised to unfold after the culmination of the NFL season, marking a new chapter for Barstool following its recent split from Penn Entertainment.
Barstool and DraftKings: A New Alliance in Sports Betting
Barstool Sports, a name synonymous with sports culture and entertainment, is reportedly in advanced discussions with DraftKings. The deal, which is expected to be a multiyear agreement, could see Barstool promoting DraftKings odds across its extensive media platforms. In return, Barstool would receive compensation for directing new customers to DraftKings’ sportsbook. This arrangement, however, would not extend to Barstool lending its name to a separate sportsbook or betting app.
The Financial Playbook
Financially, the deal is speculated to be quite lucrative for Barstool, with figures potentially reaching into the low eight figures annually. This partnership represents a strategic move for both entities, as DraftKings continues to expand its market presence and Barstool seeks to leverage its influential content and audience base in the sports betting domain.
Penn Entertainment and Barstool: The Previous Game Plan
The backdrop to this new deal is Barstool’s previous relationship with Penn Entertainment. Penn had acquired a significant stake in Barstool, investing $163 million for 36% initially and later purchasing the remaining 64% for $388 million. The plan was to harness Barstool’s brand and audience to promote the Barstool Sportsbook betting app. However, the partnership did not yield the expected results, leading to Penn selling Barstool back to its founder, Dave Portnoy, for a nominal $1.
The ESPN Bet Pivot
Following the sale, Penn pivoted to partner with ESPN, launching ESPN Bet and taking an $850 million write-off on the Barstool acquisition. This move was part of a broader strategy to rebrand and reposition their sports betting offerings. The sale included non-compete clauses, ensuring that Barstool would not re-enter the betting market until after the current NFL season and playoffs, setting the stage for the DraftKings deal.
Barstool’s Betting Heritage and Future Prospects
Barstool’s roots in betting run deep, having started as a weekly betting pamphlet in 2003. Gambling advice has remained a core element of its content, and the potential partnership with DraftKings signals a return to this foundational aspect of the brand. Former CEO Erika Ayers Badan had hinted at this direction in December before she departed from the company.
The Impact on the Market
The news of the potential deal has already made waves in the stock market, with DraftKings’ shares rallying to their highest level since late 2021. The market is responding to the anticipated synergy between Barstool’s content creation prowess and DraftKings’ established betting platform. Meanwhile, Penn’s stock experienced a slight dip, reflecting the ongoing shifts in the sports betting sector.
Looking Ahead: The Post-Super Bowl Reveal
While representatives from DraftKings, Barstool, and Penn have not publicly commented on the matter, the sports and gaming communities are eagerly awaiting the official announcement. Expected to come after the Super Bowl, this deal could redefine the sports betting landscape, combining Barstool’s influential media presence with DraftKings’ robust gaming platform.
In conclusion, the impending partnership between Barstool Sports and DraftKings is set to open a new playbook in the sports betting arena. With both companies bringing their strengths to the table, this collaboration could be a game-changer, enhancing the betting experience for sports fans and potentially driving significant growth in the industry. As the final whistle of the Super Bowl approaches, all eyes will be on these two players as they prepare to kick off their new strategic alliance.
