Did FanDuel Pass On Barstool Sportsbook Before Penn National Deal?

Posted on September 29, 2020

Could one of Penn National’s chief rivals in US sports betting have acquired Barstool Sportsbook for a cheaper price?

According to Barstool founder Dave Portnoy, FanDuel had the inside track on buying Barstool.

“FanDuel specifically could have gotten us for far cheaper than Penn did,” Portnoy said on the Pomp Podcast. “But they missed the boat.”

Barstool promoted various bookmakers before the Penn deal, including FanDuel, DraftKings and PointsBet. And while potential takeovers were discussed, nobody else made an offer.

“I think [other operators] were too scared of controversy and me,” Portnoy said. “And we’d already worked with them for a while, so they thought they’d got everything out of us, got our audience.

“But, if you’re watching a football game and there’s ten commercials for sports betting, do you pay attention to any of them? Probably not. I don’t think anyone realised what would happen if we focused our attention on one company.”

Big miss for FanDuel?

Penn ultimately acquired a 36% stake in Barstool for $163 million in cash and stock – a price that wasn’t even negotiated on, Portnoy said. And the lack of an offer from FanDuel put yet another chip on his shoulder.

“These guys we were doing business with, who I liked, they’re not going to make an offer? You (f***ing) idiots. And they’ve probably had to spend more on talent than if they had just bought us. Because we put them in a box.

“They missed. And I don’t know if they’d say they missed. But they missed. Because I liked those guys running it. If they made a competitive offer, I felt we could win with these guys.”

FanDuel, which declined to comment on Portnoy’s remarks via a spokesperson, has since done media deals with Pat McAfee, Uncle Sal and The Ringer.

Penn National and DFS?

Despite the past failed negotiations, Portnoy refused to rule out a Penn tie-up with a DFS brand down the road.

“I think there’ll be consolidation in the market,” he said. “If you combine FanDuel or DraftKings with us, that’s the end of the market.”

“Do you want that to happen?” asked host Anthony Pompliano.

“It depends how much money I’d get and who’s in control,” Portnoy responded. “If those two combine, it doesn’t matter because it’s the same company with a very similar database. But we are a very different thing. We combine with one of those companies and the other is dead. I like that position and it could happen down the road.”

More to come from Barstool Sportsbook

Barstool Sportsbook took $11 million in handle on its first weekend live in Pennsylvania, according to Penn.

Penn said the sportsbook app attracted 12,000 first-time depositors (FTDs) in Pennsylvania. Those customers had an average first deposit size of approximately $243.

Portnoy said the launch went as well as possible given the head start for rivals.

“We had 30,000 downloads that were entirely organic,” he said. “There’s 10 existing companies with a huge lead on us. There’s no other company in the world who could have made that dent with 0 cents spent. We didn’t spend a cent.”

The Barstool founder also took a quick shot at BetMGM’s new brand ambassador:

“Jamie Foxx versus Dave Portnoy on gambling? That’s a beatdown. I know MGM, I know Caesars and they’d never do a deal with us because they’re stuffy suits or whatever. Nobody had heard of Penn before us, so I know I’m still underpaid.”

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Brad Allen

Brad has been covering the online gambling industry in Europe and the US for more than four years, most recently as the news editor at EGR Global.

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