According to Chief Executive Officer Michael G. Rubin, Fanatics will have an online sportsbook in January 2023, though which state has not yet been determined. Next year, Rubin says, will be the coming out party for the company as it enters the competitive sports betting market.
“We’ll be in every major state, other than New York, where you can’t make money, by next football season,” Rubin said at the CAA World Congress of Sports last week.
Maryland may be one of the first states where a Fanatics Sportsbook could be available. Online sports betting in Maryland is expected to launch in November or December, rolling them out in phases as opposed to a universal launch date. Fanatics and the Washington Commanders, who play in Summerfield, have a deal in place for the retailer to be an official sports betting partner of the NFL team.
Fanatics Sportsbook CEO predicts $8 Billion in Revenue in Five Years
Rubin predicted the company could eventually build a sports betting business with $8 billion in revenue, but the CEO was careful to explain that Fanatics is interested in being profitable in the endeavor.
“Where we have revenue, we try to have profits that follow it,” Rubin said. “We do like to make money, by the way. It’s a crazy concept in business.”
"In the betting business, we're going to start launching multiple states in January."
— Sports Business Journal (@SBJ) October 11, 2022
Rubin appears to be taking a swipe at sports betting companies that are pouring money into acquiring customers while losing money. But those companies are hoping that as they gobble up market share, they will outlast competitors and also get a head start on late arrivers to the industry.
Fanatics is seen as being late to the party. The U.S. Supreme Court cleared the way for legal sports betting in the country when it struck down a federal ban in 2018. Since then, dozens of sports betting operators have entered the market. The leading sportsbooks in the U.S. are DraftKings, FanDuel, BetMGM, and Caesars. Those companies and a few others are battling for market share in many states across the map. Fanatics has chosen to wait it out, despite having a brand and a customer base that could dwarf even the biggest gaming companies in the market.
According to Fanatics, the company has a database of 94 million customers and is valued at more than $27 billion. Fanatics is a retailer of licensed sports merchandise, and also supplies eCommerce solutions for several sports leagues and teams, including most notably NBA.com and NFL.com’s online stores. It claims to be the largest retailer of licensed sports merchandise in North America.
“We’re really bullish,” Rubin said in the interview. “We also have a very long-term approach to the business. Things don’t happen overnight. I think in five years [$8 billion is] where we’ll be.”
Predicts First Fanatics Sportsbook by January
Fanatics has yet to reveal its plans on how it will gain market access in states where sports betting has been legalized, despite hinting that it will have its first sportsbook online in January. The company would need to apply for licenses, with most states requiring a partnership with either a tribal organization or a professional sports team.
The state of Ohio will launch online sports betting on Jan. 1, 2023, bringing one of the most populous states into the market.
Earlier this year, Fanatics announced the hiring of Andrea Ellis as CFO of its Sports Betting and Gaming Division. Ellis has no prior experience working in sports or sports gaming but will work under Matt King, who previously was CEO of FanDuel.
With Maryland launching online sports betting in the fourth quarter of 2022, and Ohio and other states planned to join in 2023, the U.S. will have more than 30 states with legal, regulated sports betting, plus the District of Columbia.
Early in 2022, Rubin scored a coup when he raised $1.5 billion in funding. Some of that money could come in handy when Fanatics finally launches its sports betting division and registers users in a legal state. Rubin has not indicated which state would be the first to have an operational Fanatics sports betting app.
“We’ll do it on a very calculated basis,” Rubin said. “We’re not in a rush to do everything at once, because if you do that, you screw it up.”
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