FanDuel has recently been proactive about addressing its previous mistakes in its pursuit of bringing online sports betting to California. A more conciliatory and cooperative approach with California’s Native American tribes is now the path being chosen by America’s most popular online sportsbook.
Tribes Show Who’s Boss
California’s tribal nations have a virtual monopoly on gambling in America’s most populated state. Although cardrooms are scattered across the sun-splashed landscape, they are limited primarily to poker and pose only a mild threat to the 76 tribal casinos throughout the state. The revenue the gaming tables and slot machines generate have allowed the state’s tribes to flourish, which is why their stronghold on gaming is jealously guarded.
Therefore, it is not surprising that, when national sports betting operators tried to muscle their way into the California market in 2022, the tribes banded together and spent hundreds of millions of dollars in advertising to convince the California electorate that mobile sports betting was not in their best interests. The tribes won and the seven commercial operators behind the initiative, including FanDuel, were sent packing.
Tribal Chess
However, that doesn’t mean the tribes are necessarily averse to online sports betting. It only means they want control of the market.
The tribes have expressed a tepid willingness to allow online sports betting operators like FanDuel or DraftKings to form management services partnership agreements with them versus fully branded sportsbooks allowing the operators greater control and a larger share of the profits.
Certainly, the national operators underestimated the resolve of the tribes and the prospect of sports betting in California is remote without their cooperation. It has been an expensive education for the commercial platform providers but waiting patiently and trying a different approach is well worth the effort as California will undoubtedly become the most lucrative sports betting market in the nation once it goes live.
Mea Culpa
FanDuel has taken the lead in getting back in the good graces of California’s tribal nations and even hired Rikki Tanenbaum, a former CEO for the San Manuel Band of Mission Indians, to become the company’s president of strategic partnerships. And there is no bigger strategic partnership out there than the one with California’s tribes.
Admitting mistakes is not something we often hear from politicians or big corporations. However, it can be a refreshingly candid approach and one that FanDuel president, Christian Genetski, is vigilantly pursuing as he looks to pivot from a ruthless competitor to a genteel partner.
Genetski recently attended a meeting with the major tribal leaders at the Western Indian Gaming Conference, held at the Pechanga Casino Resort in Los Angeles. It was there that California Nations Indian Gaming Association chair James Siva recognized Genetski and said the following:
“I’ll address the elephant in the room, the gentlemen next to me. As soon as it was announced, there were a lot of questions. As much as I hammered them during the initiative fights, the way we left it was always that we do have to find a path.”
Genetski responded by stating, “If I reflect on 2022, it was a well-intentioned but uninformed and misguided attempt. It was definitely a spectacular failure on our part. It wasn’t the right plan or the right time.”
“We [came back and] started by saying, ‘That was a mistake; when you are ready to talk, we will show up.’ We’ve had a number of conversations, and there are six or seven members of my team here today, each of whom is ready to travel at the first invitation. It takes a long time to build trust. There are lots of words from me today, but actions matter,” Genetski added.
As of this moment, there are no agreements or partnerships between the two, only a promise to continue talking. And although we may not see online sports betting in the Golden State for a while, it seems it is much more of a reality than it was just a few weeks ago.
