“Get it done before the NFL season.”
Every year, that’s the unofficial mantra for many U.S. sportsbooks launching new products or new features. The long-awaited Fanatics betting vertical just successfully hit that target, closing a large chunk of its $225 million acquisition of PointBet’s U.S. business Thursday, a week before the NFL’s opening night.
The completed agreement, which covers eight of the 14 states in which PointsBet currently operates, will allow Michael Rubin’s nascent betting business to dramatically increase its footprint prior to NFL games kicking off. Deals for the other six states are expected to close sporadically over the next handful of months.
Fanatics will go with a dual-brand strategy at the outset. Its own Fanatics Sportsbook is currently operating in four states, and the PointsBet app will continue to operate in the eight states that were just acquired (they will be rebranded as “PointsBet, a Fanatics Experience.”). Most important, according to Fanatics Betting and Gaming CEO Matt King, the move allows the company to insert some of its consumer rewards programs into the PointsBet app immediately.
“We knew as soon as we closed that we could start enhancing the PointsBet experience with Fanatics rewards,” King said in an interview. “We’ll take PointsBet players to our Super Bowl party the same way we’ll take Fanatics players. The jersey drops as well.”
Eventually, the company plans to merge the two into one app. King said Fanatics is “still working through” that timeframe—and it still needs to close on six more states from the acquisition—but that he hoped that would be done by the start of the NCAA’s March Madness tournament in the first quarter of next year.
Fanatics fended off late competition from DraftKings to secure the PointsBet deal. King said the company saw the acquisition as benefiting Fanatics in three main ways: 1) market access, 2) trading technology and 3) customers.
The trading technology, he said, accelerated “by a number of years” the backend work that Fanatics was planning to build internally. And despite Fanatics’ roughly 90-million-person database of sports fans, King said there was “revenue acceleration” in layering on the PointsBet customer data.
“A lot of those users we do know as Fanatics,” he said, “but it’s one thing to know you as Fanatics and another thing to have you as a qualified account with money on deposit.”
The Fanatics Sportsbook is currently available online in Maryland, Massachusetts, Ohio and Tennessee, and has retail locations in Ohio and inside the Washington Commanders stadium. The eight PointsBet state operations acquired Thursday are Colorado, Iowa, Kansas, Maryland, New Jersey, Pennsylvania, Virginia and West Virginia. (This means residents in Maryland can use both the Fanatics app and the PointsBet app).
The six remaining PointsBet operations are Illinois, Indiana, Louisiana, Michigan, New York and Ohio. Johnny Aitken will continue as CEO of PointsBet's U.S. business.
