Jay-Z Partners with Fanatics to Create Sportsbook
Multi-platinum recording artist Jay-Z and Fanatics, the surging sports apparel company, have joined forces, but it’s not for a clothing collaboration.
Jay-Z and Fanatics are entering into a business venture to create a sportsbook. Fanatics hired former FanDuel CEO Matt King to start exploring the betting space, so it was apparent Chairman Michael King wanted to craft a sportsbook. However, the announcement came sooner than expected, and it’s intensified because of the partnership with Jay-Z.
Fanatics is Building an Empire
Michael Rubin has created an empire at Fanatics, and the company is continuing to expand. Fanatics is known for sports apparel, as the company has branding deals with every major professional sports league and team in the United States.
Fanatics also works with a variety of colleges to supply its merchandise. The company is currently valued at $18 billion, rising from $6.2 billion in August of 2020. One of the most recent conglomerates to invest in the company was Major League Baseball.
The company is prepared to dive deep into the surging sports betting business in the United States. This is one industry in which Fanatics could perform well because of its notoriety within the sports world. When this is combined with Jay-Z’s promotion, it should create a lucrative platform.
Details of the Sportsbook
Michael Rubin and Fanatics are preparing to join the New York sports betting market when it launches. On Monday, Rubin and Jay-Z, who is already a Fanatics investor, submitted the paperwork to the New York State Gaming Commission.
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The rapper will serve as the vice-chairman and be on the board of directors for Fanatics Betting & Gaming, the entity which will include the sportsbook. Michael Rubin will serve as the CEO of the betting business.
Following the announcement, Rubin said, “We’ve realized we have this incredible opportunity…to really transition from a leading e-commerce company to building the leading digital sports platform. That means, as a sports fan, you go to Fanatics and get any sports product that’s important to you.”
If Fanatics is approved to operate in New York, Rubin will be one step closer to his goal. The technology behind the book will be operated by Kambi, one of the best odds providers in sports betting.
The trio of Rubin, Jay-Z, and Kambi is epic, and the rapper adds more than just name and capital to the platform. He had held gaming licenses in Las Vegas and Atlantic City at his 40/40 clubs before they were closed.
Fanatics will be directly competing with the major players in sports betting in New York. DraftKings, FanDuel, BetMGM, Caesars Sportsbook, PointsBet, and WynnBET have all attempted to secure licensure in the state.
The New York market should be competitive, but it will come at a cost. Operators will agree to a 50% tax rate on revenue where the average US fee is approximately 15%. New York’s heavy population and strong gambling market should produce big numbers, but they will come at a cost.