The recent $150 million sale of PointsBet’s US operations to Fanatics will change the sports betting landscape in at least a dozen states where PointsBet operates.
That change might be seen most prominently in Colorado. Fanatics becomes the sports betting partner of the Colorado Avalanche and Denver Nuggets, two franchises that have enjoyed tremendous successes as of late.
Fanatics Colorado Sportsbook intends to become synonymous with Denver sports in the years to come.
Sportsbook now a partner with Kroenke Sports
Of the 12 states Fanatics moves into with its purchase of PointsBet, Colorado sports betting could feel the most significant impact of them all. Even though Coloradans still cannot play at online casinos, that could change in the near future. Fanatics will be well-positioned to take advantage should that happen.
The prospects of future online casino expansion add to why Fanatics can carry the torch in PointsBet’s partnership with Kroenke Sports & Entertainment (KSE).
KSE owns Ball Arena (formerly Pepsi Center) and its tenants, the Avalanche, Nuggets, and lacrosse team Colorado Mammoth. It also owns local media outlets Altitude TV and Altitude Sports Radio.
Fanatics to integrate sportsbook with apparel sales
The KSE deal made PointsBet the exclusive betting and gaming partner for several entities KSE owns. This included all gaming verticals, even online casinos in Colorado, if and when they became legal.
Fanatics has the aforementioned deep pockets, valued at $31 billion last December, and is already the official e-commerce partner of the NBA, NHL, NLL (lacrosse), and more. Its long-term strategy involves integrating its sportsbook with apparel and other offerings. One example includes bettors earning rewards points they can use for discounted merchandise.
With already-huge brand recognition, its newfound local presence can help grow all sides of the business. We expect the relationship between Fanatics and KSE to continue for the foreseeable future.
What about the TPC partnership?
PointsBet’s Colorado involvement went beyond its professional sports teams. It also partnered with TPC Colorado to become the official sports betting partner of Korn Ferry Tour’s TPC Colorado Championship at Heron Lakes.
Terms of the agreement made sense at the time because of PointsBet’s ties to NBC, which owns The Golf Channel and broadcasts numerous events on its flagship station year-round.
The partnership is less appealing now but could still be a profitable one to maintain. However, it seems less certain Fanatics will renew when the multiyear deal concludes.
Colorado provides a calculated opportunity
Fanatics CEO Matt King has spoken about wanting to become the top sports betting operator in 10 years.
Surprisingly, Fanatics has sat on the sidelines, slowly growing its partnerships as the sports betting market took shape. By waiting, though, King estimates market access costs 40-50% less now than 3 to 5 years ago. Fanatics can enter markets further ahead than by starting from scratch.
PointsBet operates in 14 states, only two of which Fanatics is also live. Colorado provides a unique opportunity among those states due to PointsBet’s previous involvement.
The timing is also very convenient, thanks to the recent successes of the Nuggets and Avalanche. The Avs won the 2022 Stanley Cup and are poised for several more runs throughout the decade. The Denver Nuggets betting and enthusiasm are taking over this year since the team is in the NBA Finals for the first time in franchise history.
More success equates to more jersey sales and sports wagers, both of which are in Fanatics’ wheelhouse.
Coloradans can expect increased Fanatics presence
Some areas of PointsBet’s presence will no longer serve Fanatics, including the recently-ended partnerships with the University of Colorado Athletics and other NCAA programs. The NBC equity stake also ends for all US-facing PointsBet assets.
This leaves Fanatics entering the picture with complete control over its operations in one of the most attractive US markets. Its existing and acquired partnerships can provide advantages not even the top sportsbooks can match, especially in Colorado.
Urgency also comes into play now that Fanatics is no longer on the sidelines. Expect to see its name become synonymous with Denver sports, blasted around Ball Arena and on TV, radio, billboards, and online.
A model for the rest of the country
By acquiring an established operator, Fanatics will look to increase its standing across more than a dozen markets. Its Colorado basket already has a lot of eggs inside, giving the company ammo to hit the ground running and employ strategies that could translate to other states.
Fanatics will gain more partnerships with sports teams outside of Colorado through PointsBet. It has also established its own roots in states such as Maryland, where it opened the first-ever retail Fanatics Sportsbook at FedEx Field, home of the Washington Commanders.
After the acquisition, Fanatics will have partnerships with a dozen teams:
- Denver Nuggets (NBA)
- Colorado Avalanche (NHL)
- Colorado Mammoth (NLL)
- Chicago Bears (NFL)
- Indianapolis Colts (NFL)
- Cleveland Guardians (MLB)
- Detroit Tigers (MLB)
- Columbus Blue Jackets (NHL)
- Detroit Red Wings (NHL)
- Detroit Pistons (NBA)
- Indiana Pacers (NBA)
- Austin FC (MLS)
Colorado is the perfect opportunity for Fanatics to get the ball rolling if it plans to overtake giants like FanDuel and DraftKings Colorado in the next 10 years.
Its progress here will serve as a window to its success in other states – a big win here will bode well for its chances, but a failure to gain momentum will result in maintaining the status quo nationwide.
