Barstool Reportedly Set for Return to Sports Betting

Barstool Sportsbook, six months after unceremoniously being replaced by Penn Entertainment in favor of ESPN BET, looks as though it is on the cusp of returning to the U.S. legal sports wagering scene, according to a . 

This time, Barstool won't be tethered to Penn, it will be an affiliate partner with another heavy hitter in the American legal sports betting, DraftKings. Reports are that Barstool's Dave Portnoy is in talks with DraftKings on a marketing partnership that will see Barstool essentially become a surrogate of the DraftKings brand.

But thanks to a "non-compete" element of Penn's sale of Barstool back to Dave Portnoy, the rumored deal cannot be finalized until after this year's Super Bowl.

The arrangement

Under the rumored DraftKings/Barstool arrangement, what has been deemed a "traditional marketing partnership deal" will soon be in place. Barstool is being brought on to promote DraftKings odds on their site and to drive traffic to the DraftKings brand. It is a pure marketing play for both sides.

In turn, Barstool Sportsbook would get a cut from the wagering activity from the customers they ultimately referred to the DraftKings product. This while not even relaunching a separate Barstool Sportsbook betting app.

The partnership is set to pay Barstool a reported “low eight figures per year” in what has been described as a multi-year deal. Of note, there has been no comment thus far from DraftKings, and nothing has been put onto paper just yet.

Remember when...

Penn Entertainment, back in August, cast Barstool Sportsbook aside after it signed a deal to bring on ESPN BET as its major provider in the U.S. market. At that time, Penn sold the Barstool name back to Barstool creator Dave Portnoy for $1. This after Penn paid $163 million for 36% of Barstool in its first installment and acquired the remaining 64% for another $388 million.

At the time, it was expected that Barstool Sportsbook would elevate itself and Penn to a healthy market share in a host of American jurisdictions.

The arrangement never really got off the ground as Barstool remained a middling name among the best sports betting apps. The partnership never really threatened any of the major players among the top betting sites in the American market. 

Fast forward a couple of years, and Penn unloaded the Barstool brand for $1 and reported an $850 million write-off from the sale. Penn opted for a safer gamble in the form of ESPN BET.

The stipulations? Portnoy would have to relinquish 50% of any gross proceeds of any sale of Barstool, and Barstool was prohibited from taking any bets until after the current NFL season concluded.

Portnoy the big winner

Dave Portnoy has been and will continue to be a polarizing figure in the sports media world. But there is no doubt that he comes out as the huge winner of the Penn/Barstool/DraftKings saga.

Not only did he receive $550 million from Penn Entertainment for the rights to use the Barstool brand for a couple of years, but he also regained full control of the company for $1. Portnoy then turned around and attached the Barstool name to one of the top-two best sportsbooks in DraftKings.

In the end, Portnoy will not have to sell the Barstool brand and pay Penn 50% of the profits. Portnoy's betting baby will live on, in an arrangement that he and the Barstool brand will continue to benefit from financially.