The Kansas City Chiefs won their Super Bowl LVIII matchup against the San Francisco 49ers on Sunday night, and shortly afterward, David Portnoy, the founder of Barstool Sports announced that his company had partnered with DraftKings (NASDAQ: DKNG). Rumors about this collaboration started circulating about three weeks ago, but the deal couldn’t become official until after the game due to Barstool’s noncompete agreement with Penn Entertainment (NASDAQ: PENN).
Portnoy’s company, Barstool Sports, struck a deal with DraftKings in a new multi-year agreement, valued at potentially upwards of $10 million. The collaboration marks their reunion after a decade-long relationship, whereby both companies were born in Boston and worked together when DraftKings was mainly involved in daily fantasy sports (DFS).
As seen in his social media post, Portnoy expressed his pride in the partnership, mentioning that DraftKings would once again serve as the exclusive sports betting partner of Barstool Sports.
The recent move is significant given the historical ties between Barstool and Penn, with the regional casino operator purchasing a stake in the media company and then later selling it to work with ESPN. This deal subsequently allowed DraftKings to break away from its relationship with ESPN and engage in more lucrative partnerships, such as the one with Barstool.
Portnoy demonstrated his financial acumen when he reacquired Barstool Sports for just $1 after Penn had previously paid over $550 million to own the company outright. His decision to work with DraftKings again also reflects his long-term strategy to discuss sports betting and media at large with an official financial backer.
The sudden revival of the relationship between Barstool and DraftKings was surprising to some industry observers, who noted that Penn’s noncompete agreement with Portnoy expired on the day of the Super Bowl, potentially serving as an oversight or lapse in the operator’s strategic planning. With Barstool now firmly backed by DraftKings, Portnoy seems to have come out ahead once again, establishing a truly formidable partnership in the sports media industry.