From rapping to sports betting
World-renowned rapper Jay-Z could soon enter the US’s lucrative betting market through an investment in sports merchandise company Fanatics. The company has put itself forward as one of the applicants for a sports betting license in the state of New York.
As reported by CNBC last week, Fanatics recently secured a fresh round of investment to fuel an expansion into sports betting, raising $325m in total. Hip-hop legend Jay-Z, born as Shawn Corey Carter, was one of the main sources of these funds. He has partnered with Fanatics founder and executive chair Michael Rubin.
Fanatics has partnered with gaming supplier Kambi in its bid for a license
On Monday, TMZ confirmed that Jay-Z’s name has appeared on one of the applications submitted to the New York Gaming Commission (NYGC) requesting a sports betting license. Along with Penn Sports Interactive, Fanatics has partnered with gaming supplier Kambi in its bid for a license.
The NYGC will choose the successful applicants based on a points system. The regulator has not yet decided how many permits are available for sportsbooks. However, the body is expecting to hand out licenses to a minimum of four operators.
Fighting off some big names
Jay-Z may have one of the most famous names in the world of hip hop, but his sportsbook company is facing some tough competition in its battle for a New York license. The NYGC unveiled a full list of sportsbook bidders in its Request for Applications process last week.
In addition to Kambi, FanDuel, Bet365, theScore, and FOX Bet have all submitted bids as primary applicants. Some of them have also partnered with other sportsbook operators to increase their chances of success. In one of the most notable groups, FanDuel has teamed up with Bally’s Corporation, BetMGM, and DraftKings.
FOX Bet, Bet365, and theScore have put forward applications without any partners
Kambi has submitted two bids. In addition to its application featuring Fanatics, the operator has also proposed a second offering with Caesars Sportsbook, PointsBet, and Rush Street, among others. Meanwhile, FOX Bet, Bet365, and theScore have put forward applications without any partners.
TMZ reported that the NYGC has indicated that it will approve at least two of the six primary applicants. The body will make its decision before December, with the market expected to launch after the Super Bowl in February 2022.
Fanatics ready to branch out
Founded in 1995, Fanatics began as a seller of sports apparel and memorabilia. However, the company has recently made clear its desire to branch out into other sectors. According to the Wall Street Journal, Fanatics sources have suggested that the latest round of investment has increased the value of the company to $18bn. The firm expects to earn $3.4bn in revenue this year alone.
Jay-Z’s financial contributions have added to the funds of already existing investors, including MLB, SoftBank Group Corporation’s Vision Fund, and private equity giant Silver Lake. The rapper has invested through the entertainment company he owns called Roc Nation LLC.
The company has also made significant changes in regard to management. Former FanDuel CEO Matt King will lead the company’s sports betting expansion, while Los Angeles Dodgers President Tucker Kain has joined as chief strategy growth officer.