Missouri launches its sports betting market on Dec. 1, but one of the nine approved sportsbooks will not be taking bets.
Underdog has pulled its license application in the Show-Me State, the Missouri Gaming Commission (MGC) told SBC Americas. Underdog confirmed the exit to SBC Americas.
Neither Underdog nor the MGC offered further comment, but the withdrawal means Missouri will launch with eight online sportsbooks, not nine.
Underdog chased Missouri license early
Historically a daily fantasy sports-focused operator and a licensed DFS platform in Missouri already, Underdog was one of the very first companies to apply to be a licensed sportsbook there once the state opened its application period.
The company’s Senior VP of Government Affairs and Partnerships, Stacie Stern, told SBC Americas in June that it had a longstanding and collaborative relationship with the MGC, and the MGC spokesperson added to SBC Americas on Wednesday that Underdog will maintain its fantasy sports contest operator license in good standing.
After applying for the sports betting license that it has now relinquished, Underdog moved to lock up some sports partnerships in the state. It first partnered with MLB’s Kansas City Royals for its tethered, revenue-share license and subsequently signing a multi-year marketing deal with the NHL’s St. Louis Blues.
The Royals and Underdog had an existing non-gambling partnership, but the Royals-tethered sports wagering operator license is now theoretically available for a future approved operator to take up. The Blues deal, meanwhile, gave Underdog the rights to use the Blues’ intellectual property and video assets for marketing materials and in-person fan experiences.
As well as the partnerships, Underdog had purportedly been marketing fairly heavily in Missouri in the lead-up to the market’s launch.
Part of prediction market pivot?
While Underdog did not confirm the reasoning for their withdrawal, the MGC’s Executive Director, Mike Leara, told Fox2Now that the regulator understands that Underdog has chosen to focus its attention on prediction markets.
“They have decided to go to that market,” Leara said. “It’s not regulated at any [state] level compared to what traditional sports betting is regulated, and obviously, there’s no tax on it.”
Underdog has offered prediction markets in some states since September via a technology provider deal with Crypto.com, mostly pointing its sports contracts offering towards states that have not legalized sports betting. Missouri was not part of Underdog’s initial rollout of prediction market states, but is currently listed as a state in which it offers event contracts.
That would suggest that Underdog has chosen participation in prediction markets, which are not subject to state gaming taxes, over sharing betting revenue with the Royals and paying 10% to the state under its sports betting model.
All in all, Underdog offers some form of prediction markets in around two-dozen states including Missouri, has a DFS presence in 41 states and offers typical online sports wagering in North Carolina, the most recent sports betting market to open in the U.S.
Missouri will now launch online sports betting on Dec. 1 with eight licensed sportsbooks:
- bet365
- BetMGM
- Caesars
- Circa Sports
- DraftKings
- Fanatics
- FanDuel
- theScore Bet
