Barstool Sports is in advanced negotiations to establish a sports betting marketing partnership with giant DraftKings, according to media reports. This agreement would not involve Barstool lending its name to any sportsbook or app, instead focusing on promoting DraftKings odds and benefiting from customers referred to the sportsbook.
Current discussions suggest a multi-year agreement that could provide Barstool with an eight-figure annual financial compensation, although final terms have not yet been formalized, specialized sports website Sportico reported.
Barstool’s completion of this betting agreement would only be possible after Super Bowl due to contractual restrictions stemming from its separation from Penn Entertainment. Penn, which had initially acquired a 36% share of Barstool for $136 million in previous transactions, and then bought the other 64% for $388 million, sold its stake back to founder Dave Portnoy for the symbolic amount of $1 last year after an unsuccessful attempt to launch a betting app under the Barstool brand.
The sale included restrictive clauses, including one that prevents Barstool from engaging in betting activities until the end of the current NFL season, according to sources, and a stipulation granting Penn 50% of the sale proceeds if Portnoy sells the company in the future.
The negotiation took place after Penn dropped the Barstool brand to invest about $2 billion in the launch of ESPN Bet. With the partnership, ESPN ended its marketing partnership with DraftKings, time at which the betting giant reportedly began its negotiations to undertake marketing actions with Barstool.
Sports betting is an integral part of Barstool, which started as a publication focused on betting and fantasy in 2003, with betting advice and tips being a central part of its content. Gambling advice and picks remain a critical part of Barstool’s content, but the company isn’t directing its audience to any particular sportsbook amid a lack of sponsorships.
Sportsbooks often resort to marketing partnerships with media companies to maintain brand visibility and attract new customers. DraftKings, for example, has a history of collaborations with various sports media platforms, having bought Vegas Stats & Information Network (VSiN) in 2021, as well as partnerships with several major sports podcasts, including The Dan LeBatard Show With Stugotz, Pablo Torre Finds Out, and All The Smoke.
The company has significantly invested in marketing and sales, about $1.19 billion in the fiscal year 2022, and may surpass this amount after reporting end-of-year 2023 financial reports. However, its most recent quarter was the first time in more than three years that its quarterly marketing spend dropped year-over-year.
Original article: https://www.yogonet.com/international/noticias/2024/01/25/70560-barstool-reportedly-nearing-multiyear-marketing-partnership-with-draftkings
