Barstool Sports may be back in the bookmaking business if negotiations with Boston-based mobile sports betting giant DraftKings culminate in a new dream team partnership.
The Art of the Deal
Barstool Sports founder, Dave Portnoy, also known to his acolytes as El Presidente, got very rich the last time he aligned with a sportsbook and it could happen again if the rumors of DraftKings teaming with Barstool Sports are true. If you are unaware of Portnoy’s previous dalliance with the sports betting industry, then be aware that it will likely be a case study in business schools for generations to come.
Gaming company, Penn Entertainment, was eager to align with the Barstool bro crowd, a demographic that is ideal for a sports betting company. The site has 66+ million unique monthly visitors with nearly half of its audience in the coveted 18-34 demographic. Barstool is the home of the No. 1 sports podcast, “Pardon My Take,” and the No. 1 female podcast, “Call Her Daddy.”
Penn Entertainment wanted in and paid Portnoy approximately $550 million to acquire the media company and use its name to brand its sportsbook, Barstool Sportsbook. Barstool’s media wing would be used to promote the newly-branded sportsbook and it seemed like a good idea at the time.
Penn would finish paying Portnoy off in February 2023 and El President was happy to continue his role with the company, only not as an owner but as a highly paid executive. However, it wasn’t long after that another opportunity arose, and one with far more potential than the niche market inhabited by the rabid Stoolies. Negotiations between Penn Entertainment and ESPN began, and in August, those negotiations resulted in Penn paying ESPN $1.5 billion-plus stock for a 10-year agreement.
However, the devil is always in the details, and in this case, ESPN demanded that Penn divest itself entirely of the controversial Barstool brand. And with that as the only thing standing in Penn’s way from morphing Barstool Sportsbook to ESPN BET, a deal was struck with Portnoy that they would sell his brand back to them for the princely sum of $1 with the stipulation that if he ever sold Barstool Sports, Penn would receive 50% of the profits. Portnoy has vowed never to sell.
Play It Again, Dave
One lingering clause from Portnoy’s legal theft of Barstool is that the brand cannot engage in the betting business during this current NFL season. But that doesn’t mean Portnoy can’t put his ducks in a row. Hailing from Swampscott, Massachusetts, Portnoy would be the perfect fit for the Boston-based DraftKings.
And while gambling content is a primary focus of the Barstool brand, the company is not promoting any one sports betting brand. But that could all change if the two decide this partnership is in each other’s best interest. DraftKings would get the same exposure Penn Entertainment had, only they would keep their name but get access to Barstool’s platform to advertise and promote their brand to an ideal demographic.
We won’t know how far these negotiations have proceeded, but it appears to be a good fit with plenty of synergy between the two brands.