The Aussie way has caught up to sports betting company PointsBet Holdings (ASX: PBH) as it expands its US portfolio to include horse racing betting. The Company’s subsidiary Premier Turf Club, i.e. BetPTC, has entered into a five-year agreement with North American horse racing company 1/ST TECHNOLOGY, which is a business division of The Stronach Group. 1/ST will deliver a fully integrated, white-label Advance-deposit Wagering (“ADW”) horse racing betting experience to PointsBet customers across the United States.
Under the partnership, 1/ST will provide horse racing betting products and content solutions that will be integrated with the PointsBet sportsbook app. Through this, the Company will also offer ADW to eligible states outside those in which the Company currently offers sports betting. This is a strategic expansion for PointsBet as the US horse racing industry gross revenue is expected to surpass US$3 billion by 2025, with over US$2 billion of it expected to be credited to ADW.
In the US, punters don’t place wagers against a bookmaker; instead, they play against each other. Much like the tote betting system in Australia, the wagers go into a pool, which is operated by an ADW pari-mutuel operator (here, BetPTC) who gets a commission. PointsBet will use BetPTC’s licenses and existing customer data to own and operate the ADW business.
The Company aims to launch this venture in early 2023 and even aims to cover jurisdictions where it does not currently offer its flagship sports betting services.
For PointsBet Group CEO, Sam Swanell, this is a noteworthy moment for the Australian company’s US growth strategy. He shared, “Horse racing has a unique role to play alongside sports betting in the United States, and despite already generating over US$6.5 billion per annum in industry online handle, we consider it an attractive category on the cusp of further expansion on the back of the ongoing shift from brick and mortar to digital.”
He added, “With PointsBet’s mature market Australian racing expertise, and now a strategic partner in 1/ST TECHNOLOGY that provides us with a market leading portfolio of racing products and services, we can introduce new and existing customers to a dynamic and interactive PointsBet branded horse betting experience.”
1/ST services and comprises some of the most recognised brands in the industry, such as the Preakness Stakes held on Armed Forces Day in the US and the world-renowned Pegasus World Cup. Its app has an algorithm, equipped with a fully configurable UI/UX landscape, to introduce new customers to horse racing and betting, as well as support more advanced punters. And BetPTC will get to make the most of this infrastructure.
That said, this agreement is not just a win for PointsBet. While the Company’s customers will get to try their hand at horse racing betting, 1/ST TECHNOLOGY’s customers from its brands Xpressbet and 1/ST BET will be introduced to the world of sports betting and iGaming via PointsBet.
The Chief Executive Officer of 1/ST TECHNOLOGY, Paul Williams, said, “1/ST TECHNOLOGY is excited to be partnering with the truly innovative team at PointsBet to bring the great sport of horse racing to a growing customer base across US markets.”
As of now, BetPTC is only licensed to operate in 22 states. To enable significant US coverage, the Company has applied for licensure in nine additional states so that it can expand this new venture across a majority of the US come 2023.
Alinda is a Business Reporter for The Sentiment
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