PlayUp, an Australian company that operates online sportsbooks in four U.S. states, broke into the American horse racing world Monday when it launched a new advance-deposit wagering platform in 26 states.
But it comes with a claim that challenges the industry establishment: that PlayUp’s new venture will be “the best, most horseplayer friendly racebook in the industry.”
That may not seem like a shot at other racing or ADW companies on its face, but if there was any doubt, the PlayUp Racebook Twitter account took a direct swipe at TVG — a member of the FanDuel Casino & Sportsbook Group that operates one of the largest ADW companies in the U.S. and runs its own horse racing television network — on March 28. In a tweet that linked to a story about the New Jersey ADW market potentially opening up to multiple operators, the PlayUp account made reference to “caveman tickets.”
— PlayUp USA Racebook (@PlayUp_Racing) March 29, 2022
It’s an inside-horse racing reference and the old GEICO caveman may take offense, but it addresses a common criticism of TVG and racing broadcasts and simulcast feeds: that on-air analysts put out multi-race ticket suggestions that lack betting acumen and ignore long-term expected value and ROI considerations.
Matty at AQU today Bet $164 Return $16.50 Total -$147.50
LRL bet $74 Return $0 Total -$74
These aren’t fun bets. How many new customers can afford to lose $221.50 a day following a guy who sells himself as a genius expert to sell his bets.
TVG & racing both get killed by this pic.twitter.com/AHfXxAzym3
— Inside The Pylons (@InsideThePylons) December 30, 2021
So what does “the best, most horseplayer friendly racebook” look like?
“We’re hoping to gear people against that culture of caveman tickets,” said Michael Dempsey, a longtime handicapper and columnist who was hired by PlayUp in December to get its ADW going. “We’re going to be teaching horseplayers the right way to wager. None of the ADWs are doing that. … I’m happy to troll these guys, because they deserve to be trolled.”
A wagering education
In a parimutuel setting, the operator should want its customers to win. Unlike traditional sportsbooks, parimutuel bettors aren’t wagering against the operators. They’re betting against each other and the operators get a percentage (“takeout” or “rake”) of the betting pools.
Bettors winning will encourage them to wager more, if anything. And to win in horse racing, Dempsey said, betting the correct way is just as important as having the right opinions.
“There’s a way to win in this game — wagering strategy,” Dempsey said. “You can’t retain customers if they’re constantly getting their heads kicked in. Just by the way horseplayers construct their tickets, they can improve their ROI by 10-30%.”
But the basics of wagering strategy are rarely brought into play by operators or on racing broadcasts. Instead, Dempsey said, customers are drawn to difficult-to-hit multi-race wagers by on-air analysts, and, in the worst cases, to arguably predatory “jackpot” wagers that can get into the 40-60% range of effective takeout, because they withhold portions of the betting pools for the rare case of a single winning ticket.
The proliferation of jackpot wagers serves as a regressive tax. Most days the takeout is effectively something like 60% and then even on payout days players stand no chance against the syndicates when it’s all 14 horse maiden claiming fields.
— Jake (@jbluft) April 10, 2019
So how will PlayUp attempt to enact change? Content will play a part, Dempsey said, be it through written analysis or a podcast. But he also hopes to take a hands-on approach. If a customer is having a bad run, they might get a call or an email from Dempsey or a wagering expert to help them tighten up their strategy.
“If you’re losing, we’ll work with you, reach out to you, help you learn. My job is so much better [than the sportsbook side], because I get to root for every player,” Dempsey said. “But we have to make players smarter and try to retain them. It’s hard work to be a winning horseplayer, and it’s getting harder.”
The horse racing industry views potential access to sports bettors as a growth opportunity, but that growth could be stymied if those customers lose consistently.
“There’s only so many times they’re going to redeposit before they go, ‘I’m going to go back to sports betting, because the vig is better,’” Dempsey said.
Situating for fixed-odds wagering
With all that said, the higher-level business move from PlayUp and others — like NYRA Bets, which has partnered with BetMGM and Caesars on white-label ADWs — is to position themselves for the potentially lucrative racing/sports betting crossover, when fixed-odds wagering on horse races and the concept of a “shared wallet” go live.
Dennis Drazin is the chairman and CEO of Darby Development, which operates Monmouth Park in New Jersey, where fixed-odds betting on horse racing is legal but has yet to launch. He’s also the chairman of PlayUp USA. In 2020, Darby, which operates Monmouth for the New Jersey Thoroughbred Horsemen’s Association, signed a deal to have Betmakers be the exclusive provider for fixed-odds wagers for the track.
Drazin said PlayUp “will most likely enter an agreement with Betmakers” for fixed-odds wagering.
“Racing obviously will be a big part of PlayUp’s long-term plans in the U.S.,” Drazin said. “We’re not only looking at the launch of the ADW this week, but looking to be a major player in fixed odds.”
Limitations on PlayUp’s ADW
As with many horse racing ventures, however, there are complicating factors, because of consent agreements required to offer satellite signals for ADW betting — and for fixed-odds betting, when it launches.
As of Tuesday, PlayUp had consent agreements to offer wagering on the major thoroughbred track feeds controlled by the New York Racing Association (Aqueduct, Belmont Park, Saratoga, Tampa Bay Downs, and more), as well as Woodbine in Canada and Keeneland in Lexington, Kentucky. PlayUp also offers betting on greyhound racing and standardbred harness racing.
What’s missing from the PlayUp ADW are feeds controlled by Churchill Downs Inc. and Monarch Content Management (owned by The Stronach Group, or 1/ST Racing). That means no betting for PlayUp customers on Churchill Downs for the Kentucky Derby or on Pimlico (a Stronach track) for the Preakness Stakes for now, although Dempsey is hopeful PlayUp can get a deal done with Monarch ahead of the Preakness.
Photo: Douglas DeFelice/USA TODAY