Bettors in Iowa get the first crack at Fubo Sportsbook as it launches in the market Wednesday.
Fubo Sportsbook debuts as a standalone app for sports betting in Iowa, but Fubo Gaming President Scott Butera said the platform is fully integrated with the FuboTV product. The sportsbook launches into Iowa first, largely based on how its market access agreements lined up.
Still, Butera told LSR this week he is happy the first market is Iowa, as it has largely outperformed expectations. The state hit a record $210.4 million in handle during September.
Growing Iowa sportsbook market
Fubo Sportsbook is not the only operator to launch in the Hawkeye State this week. On Tuesday, Barstool Sportsbook debuted in Iowa, its 10th state.
The Iowa Racing and Gaming Commission approved the sportsbook’s deal with Ameristar Council Bluffs in August. That casino is leased by Penn National Gaming, the parent company of Barstool Sportsbook.
With the two launches, Iowa bettors now have 17 online sportsbooks to choose from.
Fully integrated Fubo products
Bettors can wager on the standalone Fubo Sportsbook app, but Butera said the key for product differentiation will be using it alongside the FuboTV product. The over-the-top streaming service offers more than 100 live channels, including deals with regional sports networks.
The sportsbook launches with a “Watching Now” feature, which syncs lines and betting offers with what a viewer is watching through the TV product. Butera said the hope is to create complementary offerings for viewers, which boosts the core over-the-top streaming business, not just the sports betting operation.
“I like to compare sports betting to the casino business,” Butera said. “You have a hotel, casino, restaurant and retail under one roof, which all on their own are a tough business, but put together there are a lot of synergies that work well together. Sportsbooks in casinos work well because they enhance what’s going.
“That’s what we have here. People like to watch sports. People like to bet on sports. And people who bet on sports like to watch sports. Now they can get that under one roof.”
Subscribers drive Fubo Sportsbook acquisition hopes
Part of Fubo’s plan is to drive subscribers to the sports betting product. According to data provided by Fubo, 50% of its TV subscribers are interested in wagering. The company had approximately 700,000 subscribers in August, when FuboTV co-founder and CEO David Gandler told CNBC he believes FuboTV can secure up to 5 million users within five years.
“At G2E, there was lots of talk of customer acquisition costs of $500 to $1,000 per,” Butera said. “We don’t really believe in that, because we want strong performance from our subscriber base, but also those who sign up for trials because we can see if they’re signing up for specific events. We can be smart about how we market it and how we can directly engage with them.”
More states coming for Fubo Sportsbook
Fubo expects to launch in a few more states in 2021 and early 2022. Along with Iowa, Fubo’s early market access deals include:
Butera said the company is working on other market access deals as well.
Fubo acquired the sports betting startup Vigtory in January. Butera was Vigtory’s co-CEO prior to the acquisition.
Fubo stock outlook
Fubo stock has had a turbulent year. Prior to the Vigtory acquisition in January, FUBO stock sat at $24.24 to start the new year and shot up as high as $52.40 in February.
The price dropped below $17 in May before settling into the mid-$20 range until a recent climb bringing it to $33.76 Tuesday. In the second quarter, Fubo revenue was up 196% year-over-year to $130.9 million, but reported a loss of nearly $95 million.
Fubo reports its third quarter results Nov. 9, as multiple analysts peg the stock as a “buy,” according to MarketWatch.
