PointsBet Aims to Raise $84M to Expand US Betting Presence

PointsBet Aims to Raise $84M to Expand US Betting Presence

PointsBet intends to raise close to $84 million through a capital raising campaign with the goal of continuing the company’s growth across the U.S. market, according to the latest shareholder presentation posted last week for investors by the Australian-based, publicly traded company.

The company, which has steadily made more inroads into the U.S. market this year, seeks new capital from investors to continue making inroads here. PointsBet intends to enhance its development of in-house technology offerings and increase its financial footing to gain U.S. market access and satisfy government-required licensing fees.

Investors were invited to join a conference call hosted by PointsBet CEO Sam Swanell and CFO Andrew Mellor on Tuesday where more specific details would be shared. The new shares will be issued and closed by Nov. 22.

PointsBet Saw Rapid Growth Over Last Year

PointsBet has grown considerably in the months since it entered the U.S. sports betting market. The company invested heavily in expansion efforts that included the company going public earlier this year with an initial public offering where 37.5 million shares were issued at $2.00 per share.

"Similar to the way we allow fans to take part in sporting events, our public offering allows fans to take part in us, as a company and as a platform," PointsBet CEO Sam Swanell said in a press release announcing the IPO details. "The global public offering comes at a time of rapid growth for the company and industry at-large and we are eager to utilize this momentum to continue to make sports betting an exciting and rewarding experience for all our customers."

That growth included at 223% overall rise in registered PointsBet users across the U.S. and Australia over the 12 months since Sept. 30, 2018. The active user base also grew 166%, from 32,913 to 83,391 as the company emphasizes offering a different product than its U.S. competitors.

PointsBet Already Has Access to 10 States

PointsBet launched in the U.S. market in January 2019 through partnerships with the Meadowlands and Tioga Downs. Since entering the U.S. sports betting scene, PointsBet has accumulated 37,231 registers U.S. clients with 15,380 becoming active customers.

Over the last eight months, PointsBet has gained market access to nine other states through various partnerships, most notably via an agreement with Penn National. That agreement provides PointsBet access to Indiana and West Virginia, where sports betting is legal, as well as Louisiana, Missouri and Ohio, where the company’s services would be on offer should those states legalize sports betting.

Other states PointsBet has access to includes Illinois, Iowa, Colorado and New York. PointsBet plans to launch a sportsbook in Iowa by the end of the year, another one in Illinois through its 20-year partnership with Hawthorne Race Course. The other two states could see launches as well assuming the proper enabling legislation in New York and the assumed passage of voter referendum in Colorado.

Marketing Includes Leveraging Celebrity Influence

Alongside raising capital to help with market access, PointsBet enlisted NBA Hall of Famer Allen Iverson in 2018 to help drive customer growth across all markets. According to a survey commissioned by the company of 2,038 respondents across three states in the U.S., around one in 10 Americans already recognized the PointsBet brand before the company had even set foot in the U.S.

So PointsBet is betting that associating its existing brand value with celebrities such as Iverson – and former NFL star Darrelle Revis, whose image is prominent on the PointsBet website – will help the company gain even more traction with potential bettors.

“There’s a new player in town,” one PointsBet ad campaign suggests in some of the digital and radio executions seen and heard around the world. The company aims to make that true in more U.S. jurisdictions in the near future.

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