The sports media company Barstool Sports, led by founder Dave Portnoy, is reportedly in advanced talks with DraftKings for a comprehensive sports betting deal. Unlike previous endeavors, this potential deal would take the form of a traditional marketing partnership. Barstool would promote DraftKings odds, utilizing its extensive reach to refer customers to the sportsbook, according to Sportico.
The negotiations are centered around a multiyear contract that could see Barstool receiving a substantial annual sum in the low eight figures. However, no agreement can be finalized before the Super Bowl due to a lock-up period stemming from Barstool’s recent separation from Penn Entertainment. This separation included restrictions on Barstool’s reentry into the betting arena until the conclusion of the current NFL season and playoffs.
Representatives for DraftKings, Barstool, and Penn have not officially commented on the ongoing negotiations.
Barstool’s journey into the betting realm parallels its origins in 2003 as a betting and fantasy publication distributed by Portnoy. Despite its focus on gambling advice and picks, the company has lacked a formal betting sponsor, leaving it without a share in the growing sports betting market.
DraftKings, a major player in the online sports betting industry, has been eager to form strategic partnerships with media companies to enhance its brand recognition and attract a wider customer base. This potential collaboration with Barstool follows the company’s rocky relationship with Penn Entertainment, which initially acquired a significant stake in Barstool for $163 million in 2020, only to offload the media company back to Portnoy for $1 after a failed attempt to create a sustainable betting app.
Portnoy cited compliance-related obstacles as a reason for the difficulties faced by Penn in fully leveraging the Barstool brand, including issues with gambling regulators, major media corporations, and stock market fluctuations affecting both Penn and Barstool Sports.
The pending deal between Barstool and DraftKings has caused DraftKings’ stock to rally to its highest levels since late 2021, with investors closely monitoring the situation in anticipation of a breakthrough that could reshape the dynamics of the sports betting industry.