👉 Background: PointsBet launched in Australia in 2017 and now has over 230,000 active customers in Australia. But when US states began to deregulate gambling, PointsBet jumped over the water to New York, Michigan, and Pennsylvania - just to name a few.

👉 What happened: Late last year, there were talks of PointsBet selling its profitable Australian division to focus solely on the US. But now, in a plot twist, PointsBet has sold its US division to a company named Fanatics for $225 million.

👉 What else: The Fanatics started as a sports merchandise and memorabilia company. They raised $700 million USD last year, with investors like Jay Z and Meek Milll. Now they're launching into the betting industry and PointsBet's early US growth made it a ripe acquisition target for Fanatics's new betting biz.

What's the key learning?

💡With deregulation comes increased competition… and then increased market consolidation.

💡With the legalisation of sports betting in many US states, a heap of companies have flocked into the market. There were the OGs like DraftKings and Fanduel, but also casinos like MGM and Caesars. And, this has led to a highly competitive and expensive betting environment.

💡And while PointsBet had made some inroads, they only had 2.5% market share in the states it operated in - despite spending tens of millions in advertising. So by acquiring PointsBet, Fanatics is essentially reducing the number of competitors in the market and gaining a larger market share.