Upon its pending entry into the legal sports betting market, CNBC reports last week that Fanatics hosted roughly 90 Wall Street analysts for a meet-and-greet, potentially paving the way for the apparel and trading card company to soon debut as a publicly traded company.
Given Fanatics' diverse business ventures, analysts specializing in apparel, sports betting, internet, gaming, and collectibles all showed up in force.
What's Wall Street buzzing about?— CNBC's Closing Bell (@CNBCClosingBell) November 15, 2022
Private company @Fanatics holding an 'analyst day'
More than 90 folks there from wall street firms - including internet, retail and gaming analysts.@SaraEisen reports pic.twitter.com/ELSY6xMYc1
Analyst days are usually held in conjunction with a company’s initial public offering (IPO), generally acting as a precursor for drumming up potential stock market interest. But Fanatics may need to lay more groundwork with the investment community, given its ambitious sports betting goals.
Back in October, Fanatics CEO Michael Rubin announced BetFanatics would launch in January 2023.
"I think in the betting business, we’re going to start launching in multiple states in January. We’ll be in every major state other than New York, where you can’t make money, by next football season," Rubin said. "And we do like to make money by the way. It's this crazy concept in business. When we have revenue, we try to have profits that follow it."
Soon, however, Fanatics will need more money to make money. Unlike its monopoly apparel and collectibles business, sports betting sites are extremely competitive in the U.S. There are large development and promotional expenses associated with a sportsbook launch. Accordingly, the money made from a potential IPO would go a long way to fund Rubin’s aggressive sports betting goals.
Late to the party
Although BetFanatics has a license for sports betting in Maryland, it will be absent on the first day of betting in the Old Line State. Seven online sports betting apps, however, are expected to launch on November 23, including Barstool Sportsbook, BetMGM, Caesars Sportsbook, BetRivers, DraftKings, FanDuel, and PointsBet.
BetFanatics is expected to launch in Maryland sometime in early 2023, while it also has the green light for Ohio, receiving two retail and one online license. Sports betting is expected to go live in the Buckeye State on January 1 but Fanatics has yet to announce its official launch date in that market.
Ready for war
While some analysts believe that latecomers like BetFanatics might steal market share from existing sports betting operators, FanDuel vehemently disagrees.
Just one day after Fanatics analysts’ day, FanDuel issued its own message to the industry. FanDuel CEO Amy Howe said the company was not only going to defend its turf, but it also planned to expand its market leadership in U.S. online sports betting.
Although Howe didn’t mention Fanatics by name, her message was unmistakable.
"It should be clear that new entrants that are entering now at this point may face a real challenge taking on scale players who have more than a four-year head start," Howe said last week.