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Posted on: September 5, 2023, 08:43h.
Last updated on: September 5, 2023, 08:45h.
Barstool Sports is trimming its staff. The layoffs come after the media entity that intersects sports and bro culture was returned to founder Dave Portnoy last month following a financially disastrous relationship with Penn Entertainment.
Penn operates 43 casinos in 20 states. The regional-focused commercial gaming giant additionally runs online sports betting operations in 17 markets and iGaming in five states.
The Pennsylvania-based company in early 2020 invested $163 million to acquire a 36% stake in Barstool Sports. Penn bought the remaining 64% just in February for $364 million to bring the casino firm’s total stake in Barstool to $527 million.
But just six months later, Penn shocked the sports betting universe by announcing a $1.5 billion partnership with Walt Disney’s ESPN to create a new sportsbook entity called ESPN Bet. Part of the Disney deal included Penn agreeing to unload Barstool back to Portnoy for just a dollar.
Penn execs underestimated the regulatory nightmare Portnoy’s reputation brought to the company. The Barstool Sportsbook was denied gaming licenses in several states on worries that Portnoy’s past disqualified him from being deemed suitable to be a key stakeholder in a state-issued gaming license.
Along with spending more than a half-billion dollars to buy Barstool Sports, Penn Entertainment spent millions more converting the company’s brick-and-mortar sportsbooks into Barstool-branded sports betting lounges. But after Penn divested the sports and pop culture blog back to Portnoy, the company this fall will modify the spaces into ESPN Bet sportsbooks.
Portnoy’s Barstool Sports will no longer be engaged in sports betting or gaming. Portnoy says employees who worked in that business segment will unfortunately lead the layoffs.
Barstool’s workforce numbered about 130 employees before Penn’s takeover. During its time with Penn, the Barstool staff increased by about 300 positions.
I’ve been very clear. Anybody that’s paid attention, we are going to have layoffs and cuts, and they’ve started and it sucks,” Portnoy said last week on Barstool Sports Radio. “I hate firing people. You can be incompetent, not work, and I generally don’t fire because I hate it so much. It’s the worst thing to do.”
Portnoy confirmed this week that 100 people have already been let go.
“Having said that, we’re in a position where it’s a no-brainer. We have to get back to a break-even thing. We’re losing a lot and it sucks,” Portnoy explained.
Barstool Sports is going back to its roots in focusing on its blogs and social media content. Portnoy’s most recent pizza review garnered many headlines after he dubbed Dragon Pizza in Somerville, Ma., as the “worst pizza place in America.”
A contentious exchange between the pizza parlor’s owner and Portnoy led to millions of views on Barstool’s social media channels.
Penn Sports Betting Units
Penn Entertainment come this winter will no longer operate Barstool Sportsbooks at its casinos or online. The ESPN Bet books will take those places and also be used online where permitted.
Penn officials say the company will continue to leverage theScore brand for its sports betting operations in Canada. Penn bought theScore through a $2 billion acquisition of Score Media completed in August 2021.