Dave Portnoy, the founder of Barstool Sports, has become the 100% owner of the brand after it was sold back to him by its former parent company, Penn Entertainment. This transaction coincided with Penn’s major 10-year sports-betting deal with ESPN. Addressing the media in an “emergency press conference” posted on Twitter, Portnoy admitted that Barstool isn’t a good fit in the gambling industry.
Barstool’s Challenges in the Regulated World
According to a report by Variety.com, Portnoy expressed his struggles with operating Barstool in a regulated world. He mentioned that they faced difficulties in obtaining gambling licenses and experienced negative impacts on their stock price due to media coverage from outlets like the New York Times and Business Insider.
“So the regulated industry [is] probably not the best place for Barstool Sports and the type of content we make,” Portnoy stated.
Barstool’s Independence and Freedom of Speech
With Barstool no longer part of Penn, Portnoy emphasized that they can now speak freely and operate without restrictions. He nostalgically referred to it as being back to the “pirate ship” days and suggested that the brand can regain its authenticity.
Controversies and Legal Battles
Portnoy has faced several controversies and legal battles throughout the years. In November 2021, Insider published an article that included allegations against Portnoy made by three women. Portnoy filed a lawsuit against Insider for defamation and invasion of privacy, but the case was later dismissed for lack of evidence. Portnoy appealed the decision before eventually dropping the claim.
Additionally, Portnoy mentioned a “hit piece” by the New York Times in November 2022, which discussed his self-description as a “degenerate gambler.” These controversies and negative press have contributed to the challenges Barstool faces in the gambling industry.
Barstool’s History and Reputation
Barstool Sports was founded in 2003 and has gained a loyal fanbase for its sports commentary and pop culture coverage. However, critics have pointed out instances of sexist and racist content from some Barstool staffers, which have sparked controversies over the years.
The brand has also had a tumultuous relationship with ESPN. In 2017, ESPN canceled the show “Barstool Van Talk” after just one episode due to sexist attacks against one of their correspondents, Sam Ponder, by Portnoy and other Barstool writers.
The Deal with Penn Entertainment and ESPN
Penn Entertainment’s acquisition of Barstool Sports was based on the belief that the brand’s “authentic voice and vast, loyal audience” would benefit Penn’s online sports betting businesses. As part of their recent stock purchase agreement, Penn sold 100% of Barstool’s outstanding shares back to Portnoy. However, Penn still retains the right to receive a portion of the gross proceeds from any future sale or monetization of Barstool.
Portnoy’s Plans and Financial Details
Portnoy expressed his commitment to keeping Barstool Sports and declared that he will never sell the brand. Although specific financial details were not disclosed, Portnoy mentioned that he still owns a significant amount of Penn stock and expects its value to increase.
The Office Situation and Portnoy’s Critique
In a blog post on Barstool Sports, Portnoy criticized his employees for not showing up to the office on time. He jokingly questioned the intelligence of his staff, prompting speculation about the internal dynamics of the company.
Barstool’s Ownership History
In 2016, Portnoy sold majority control of Barstool Sports to the Chernin Group. In 2020, Penn Entertainment acquired a 36% stake in the brand for $163 million. Earlier this year, Penn completed its full acquisition of Barstool, purchasing the remaining 64% stake for $388 million.
Penn’s Deal with ESPN
Penn has also recently entered into a significant sports-betting deal with ESPN. Under this agreement, Penn will pay $1.5 billion in cash to ESPN over a 10-year period. In return, ESPN will provide media, marketing services, and brand rights to Penn.
Key Takeaway
Dave Portnoy has regained full ownership of Barstool Sports, with the brand no longer being part of Penn Entertainment. The move comes after a major sports-betting deal between Penn and ESPN. Portnoy admitted that Barstool faces difficulties operating in a regulated industry, but he expressed enthusiasm for the brand’s newfound freedom of speech and independence.
Facts about Barstool Sports
- Founded in 2003, Barstool Sports is a sports and pop culture blog.
- The brand has a loyal fanbase and covers the latest news, viral highlights, and offers blogs, videos, and podcasts.
- Barstool Sports has faced criticism for past instances of sexist and racist content from some of its staff members.
- Dave Portnoy, the founder, has been involved in legal battles, including a defamation lawsuit against Insider, which was later dropped.
- Barstool has had a contentious relationship with ESPN, with one of its shows being canceled after one episode due to sexist attacks against an ESPN correspondent.
Credit: variety.com
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