Betfred is considering exiting the US sports betting industry, which would mean closing its sportsbook in Virginia.
The small operator has departed three states over the last two months as it weighs its options. One of those options could be to leave the US entirely.
The effect of that in the commonwealth would be minimal, as Betfred accounts for a very small share of the sports betting market in Virginia.
Small sportsbooks struggling in US
If Betfred does decide to leave the commonwealth, it would join other struggling sportsbooks that have exited the Virginia sports betting market over the last year.
Betway shuttered its sportsbook in Virginia and in eight other states in July. Earlier this year, Unibet also exited the sports betting market in Virginia.
Betfred ceased operations in Ohio earlier this month. It left Maryland in July and will no longer be in Colorado by the end of August.
That leaves Virginia as just one of four states where Betfred continues to operate.
Betfred taking a hard look at its US business
Betfred USA CEO Kresimir Spajic told EGR North America that it all boils down to whether the company can be profitable in the US.
“I truly believe that my team and I can create a sustainable business. The question is, can you make a business profitable enough to make sense to continue operating in the US versus putting this effort and investment somewhere else that might yield a bigger return?”
Spajic said additional market exits could be on the horizon.
“In other states, we are doing the same that we’ve been doing in Maryland and Ohio, trying to basically reassess our position, renegotiate some of the old agreements, and seeing if we can find a sustainable and profitable path.”
The end goal is to keep some sort of operation in the US – even if it’s just one state, he said. But he also hasn’t ruled out a complete exit from the US sports betting industry.
“It’s on the table as well, if we don’t have enough value that we can create within the US.”
Betfred joined established sports betting market in Virginia last year
Betfred is not one of Virginia’s most popular sportsbooks.
Betfred accounted for just 0.25% of Virginia’s sports betting market from January to September last year. Over those same months this year, its market share was essentially cut in half, to just 0.10%.
By comparison, FanDuel enjoyed a 40% market share during that same time. DraftKings had the second-highest share, with 27%.
Betfred has been active in Virginia since 2023. At its launch, it became the 15th sportsbook in Virginia.
To operate in Virginia, sportsbooks must partner with a platform provider. Betfred partnered with Endeavor and Light & Wonder. Interestingly, Endeavor and Light & Wonder also partnered with WynnBET and Golden Nugget, two operators that no longer exist in Virginia.
What does this mean for the other Virginia sportsbooks?
It’s incredibly tough for smaller operators to gain ground and cement a spot in the sports betting industry—not just in Virginia but in any state. Betfred is coming to this realization.
FanDuel, DraftKings, BetMGM and Caesars account for nearly 84% of Virginia’s market. Throw in ESPN Bet and Bet365 and that total grows to 93%. Ten sportsbooks competed over the remaining 7% from January to June of this year.
The market is incredibly top-heavy. Operators need to have deep pockets and the best tech to stay afloat.
If Betfred does end up leaving Virginia and other states, it won’t be the last sportsbook to do so. It’s an unfortunate reality, but it means other operators have a chance to incrementally boost their growth.
What we’ve seen in Virginia is that smaller sportsbooks like ESPN Bet and Bet365, relatively new additions to the Virginia sports betting industry, can chisel away market share from larger operators.
Betfred is not going in that direction. It also does not hold much market share. Despite that, if it decides to pull out of Virginia, its customer base may be just as likely to switch to another small operator as join up with one of the larger sportsbooks.
According to JMP Securities, 74 companies have entered the US online gambling market since 2018. Of those, only 43 are still operating today.
