Category
🥇
SportsTranscript
00:00And I think there's a chance here, Matthew, for the first time in several years that we're
00:09not going to have another state legalized sports betting, which I did not think would
00:14happen.
00:15I thought somebody else before the end of the year would happen.
00:17We're getting an update from you guys over our legal sports report that Minnesota is
00:21now out.
00:22Thanks for coming on the show.
00:23And I, and I guess at least the opportunity to legalize is sort of looking bleak at the
00:28moment.
00:30Yeah.
00:31I mean, there are a couple of bills out there right now in states that are already legal
00:34that are trying to tweak the system.
00:36But yeah, I think this will be the first year that we don't see the, a new expansion like
00:41that.
00:42And Minnesota was thought to have a really good chance coming into this year, Craig.
00:46It had a chance last year, but there were certain topics and things that the Democrats
00:51wanted to get across the finish line last year.
00:53So sports betting kind of fell to the wayside.
00:56It only got messier this year, Craig.
00:59It's interesting because a lot of the states that are left have tribal gaming interests
01:03involved as well.
01:05And that's great.
01:06Tribal gaming interests deserve to protect their interests and all that kind of stuff,
01:10but it just makes it longer and harder to get something across the finish line sometimes.
01:15Now also work into Minnesota, the fact that there are racetracks involved who would also
01:20like a piece of it.
01:22And then work into the fact that earlier this year, the Minnesota Gaming Commission approved
01:28slot machine style machines for those racetracks, which the tribes were upset about.
01:33They said that that violated their exclusivity.
01:35Well, the legislature went in and said, no way, those HHR machines are not allowed.
01:42They're called historic course racing machines.
01:44They're based off of results run, excuse me, from old course races, but they work like
01:50slot machines.
01:52So there are a lot of moving parts of two sides here that just do not agree.
01:58And then when we got to the end, it turns out that it was all politics anyway.
02:01And the Republicans said, we will not be supporting anything that requires both of us, Republicans
02:11and Democrats, bipartisan, it's just not happening this year.
02:14And sports betting does require bipartisan support because there is pushback on both
02:18sides of the aisle there.
02:20So Minnesota is a mess, Craig.
02:23And the last day or so, last two or three days, we were hearing, don't write it off,
02:29don't write it off, something could happen, something could happen.
02:32And they came out and said, look, we thought we had it, we thought we had a deal, we're
02:37just going to come up a bit short.
02:40And it's tough to say what happens with Minnesota from here.
02:44One of the representatives that has been so behind this is not going for re-election
02:52next year.
02:53So it's not, we're not entering 2025 on as solid ground as we did with 2024.
03:01And that's certainly discouraging to everybody in Minnesota that just wants to bet on sports.
03:05Yeah, looks like next year at the earliest, which stinks.
03:08All right.
03:09We've got some updated news here on Bett Rivers and Rush Street.
03:13A lot of earnings calls coming in.
03:15What did you learn from Bett Rivers?
03:17Yeah, so this was interesting.
03:20They had their earnings call, but then they went and they spoke to Needham at their technology
03:25media and consumer conference.
03:27And I thought it was really cool, Craig, because it's hard for a company like Bett Rivers,
03:32Rush Street Interactive, to be able to get across that they have a great product when
03:38you look at the states and you see the market shares and you figure out, okay, well, they
03:42must only have 5% because it's just not that good.
03:45And that's not the case.
03:47CEO Richard Schwartz took his opportunity here to say, you know, other companies like
03:53FanDuel, DraftKings, they have massive marketing budgets.
03:56They have massive DFS databases that they can tap into, and we're doing things a little
04:02bit differently.
04:03And he talked, I thought it was interesting.
04:05He talked about a lot of the sexy topics in sports betting right now of prop bets and
04:10more parlays and variety of bets.
04:12And he said, you know, those are kind of like the stars on your football team, right?
04:16Those are your position players, your quarterback.
04:18But he said, we know that the war is won in the trenches.
04:23And so what does that mean from a business standpoint?
04:26That means some of the not-so-sexy stuff that goes into building a platform, like making
04:31sure the know-your-customer stuff, maybe it doesn't work one way for a customer.
04:38Well, they have two or three fallbacks that can then make sure it doesn't have to go to
04:42a manual review, drag things out, and create what they like to call in the industry, friction
04:47for the user.
04:49Everybody just wants to make sure people can sign up, get their account funded, and start
04:53betting.
04:54And BetRiver says that they do that to a finer detail than everyone else.
04:59And it is interesting.
05:01They point to Delaware.
05:02Delaware is really the first state that they're in where they have a monopoly, and they're
05:07able to show all of this growth that they've been able to accomplish, even coming in and
05:12replacing a company who, from my personal experience living in Delaware, did not do
05:16a great job.
05:18But 888, they're now called Revoke, they're a legacy operator.
05:21They have 25 years plus in Europe, and they know what they're doing.
05:27So BetRivers was able to come in, turn that market around.
05:31And so they think that this is really a great opportunity for RushStreet.
05:36Their stock hasn't been totally in the tank this year, but it has been bad since it fell
05:42off of like $25 highs a couple years ago.
05:45But it's getting back in that $8, $9 range now.
05:49It's better than the $2.90 it was a year ago.
05:52And I think that RushStreet, now they're able to, you know, they're showing profitability
05:58in their segments.
05:59They're showing that they don't have to be a sports betting specialist to do iGaming
06:04well.
06:05And they're showing that they are willing to put in the time to retain customers and
06:10build a better platform that helps retain those customers in order to shore up that
06:15segment of the market that they've chosen to make profitable.
06:19So Richard Schwartz is doing a pretty good job right now of selling the RushStreet story.
06:26And again, from my personal experience in Delaware, BetRivers platform has been operating
06:30fantastically.
06:31Yeah.
06:32I mean, they've stayed in a different lane than some of the other companies and the success
06:35rate shows.
06:36And that's a good point, I think, that you're making, especially in a state like Delaware.
06:39Okay.
06:40So finally, let's cap it off here.
06:42The demise of sports betting and betting on horse racing has really been understated because,
06:47I mean, let's be real.
06:49I mean, the numbers are showing here that more people are betting on the Kentucky Derby.
06:52Your buddy Jim Gazzale would be happy to hear about that.
06:55And now we're getting in numbers from the Preakness as well.
06:58And this idea that because people could bet on sports legally, they didn't want to rush
07:02to the track to bet or rush to some of the other operators to bet is false.
07:06Preakness numbers up again, Matt.
07:08Yeah.
07:09Yeah.
07:10Yeah, they are.
07:11They were down a couple of years there and look, they hit highs in 2021, which likely
07:16had something to do with the COVID sports schedules messing things up.
07:20We saw over COVID that when there were no sports, people loved to bet on the horses.
07:25And I think you still saw some carryover from that.
07:28But yeah, we did see growth this year.
07:30We saw growth for the Preakness day betting, but we also saw growth in the futures pools
07:35that they run for the Preakness as well.
07:37That has been more popular overseas than it has been in the U.S., but it's starting
07:41to pick up a little bit.
07:42And look, horse betting is interesting because not every sports better really sees the carry,
07:50the crossover there because parimutuel betting is different.
07:53You're not always, you're not locking in the price that you bet at, that it could really
07:58change by the time that race kicks off and you could not be looking at what you thought
08:01you were in the first place.
08:03But operators like FanDuel, DraftKings, they are now using these events to cross sell and
08:09bring sports betters, casino players into the horse racing world.
08:15And they're doing it in ways that make sense with their technology.
08:18FanDuel, for instance, they have one account, one wallet.
08:21That means if you have money that you could go put in a FanDuel slot machine right now,
08:24you could bet with that for sports as well, or for horse racing, excuse me.
08:30DraftKings is working on something similar.
08:32So I don't necessarily see horse racing falling off here.
08:35And I don't know how much we talk about fixed odds horse racing in the future either.
08:40Right now we're seeing growth in traditional parimutuel betting and I have to think that's
08:44going to continue.
08:45Yeah.
08:46All right.
08:47Well, Matt, great stuff.
08:48Great content as always.
08:49Check Matthew Waters out as well as everyone who does a great job over at LegalSportsReport.com
08:54appearing every day here on Newswire.
08:56Thanks for coming on, Matt.
08:57Talk soon.
08:58Thanks, Derek.
08:59Take care.
09:02Bye-bye.