Churchill Downs CEO asserts TwinSpires is “not for sale”
William Carstanjen lifts lid on strategic decision to pivot away from B2C operations asserting confidence in the B2B vertical
Churchill Downs CEO William Carstanjen has refuted any talk of a sale of the TwinSpires online sports betting business after asserting it is “not for sale” to any suitors interested in acquiring it.
Carstanjen was speaking at the G2E Las Vegas conference, where he was asked about the TwinSpires business, which moved away from providing B2C sports betting services to customers in August 2022 to become a strictly B2B business.
Reflecting on the course of the TwinSpires business following the repeal of PASPA in May 2018, the Churchill Downs CEO cited the opportunity of developing an online sports betting business (OSB) in support of its pre-existing heritage horse racing wagering business being an attractive one for the firm.
“At first, we thought that everything we learned about horse racing online would directly translate into other sports,” Carstanjen told delegates during the panel.
“We thought some of those lessons that we have learned in building that business from the ground up would translate directly into sports wagering, but they really haven’t.
“It’s been an entirely different model, for example, the marketing that’s gone into it, the technology, the fact that you need partners in every state to gain access to every state – there are a lot more mouths to feed.”
He continued: “When we looked at what its worth for us, from a marketing perspective, it still works for us, TwinSpires is still a very profitable business and in many ways that division is still a shining star for us.
“As we saw OSB develop, we thought it can go into a couple of different ways and it’s largely gone the way that we thought when we got into it.
“An increasingly small number of very, very large players investing lots of capital, willing to take years of lack of profitability in order to establish themselves. That was the way we thought it could go and it was a way we couldn’t go,” the CEO added.
Since its decision to move into B2B, Churchill has signed platform supply deals with US sports betting heavyweights FanDuel and DraftKings, as well as UK-based operator bet365, while also strengthening its business with the acquisition of Exacta Systems in August.
TwinSpires was linked with a potential sale for $1.5bn in September 2021, before the business pivoted away from B2C and further into B2B, and suggestions that it could now be an M&A target post-pivot were raised on the panel.
Carstanjen was unequivocal in his response to any suggestions of a sale.
“TwinSpires is a bit of a unicorn, it’s an online business that’s very, very profitable and continues to grow. There’s always been lots of interest in TwinSpires, but it is not for sale, it is a big part of who we are. We have big plans for it in the future,” he explained.
“We’ve never been more optimistic about it, but it does have a very unusual profile now compared to where we are in online sports in general in that, in that it’s a very profitable business.
“That always gets a lot of people’s interest and that’ll probably still be the case for some time to come, but it fits well with everything we do in our company. It’s just been a little ‘engine that could’ for a long, long time. So, we’re going to keep at it,” Carstanjen concluded.