Maxim diversifies his business model from cover girl to player.
Maxim became the latest media company to expand into sports betting and iGaming with its online betting platform MaximBet.
MaximBet, majority owned and operated by Malta-based online gaming company Carousel Group, launched in Colorado earlier this month and the company said on Tuesday it would expand to Ohio.
Maxim, who is owned by entrepreneur Sardar Biglari through his publicly traded company Biglari Holdings, licensed his brand in a multi-million dollar deal with Carousel Group earlier this year. Carousel Group is licensed in Colorado through a partnership with a small local casino in Cripple Creek. MaximBet will eventually expand to Indiana, Iowa and New Jersey, where Carousel has partnered deals with Caesars Entertainment.
In addition to a multi-million dollar payment for the rights to use the name Maxim, Carousel also gave the publisher a minority stake in the online gambling business.
Founded by CEO Daniel Graetzer in 2017, Carousel Group is known for its flagship product SportsBetting.com. The licensing agreement to form MaximBet is the company’s attempt to differentiate itself in a crowded sports betting market that includes major players like DraftKings, FanDuel, MGM, Wynn Resorts as well as other media brands like Sports Illustrated and Barstool Sports.
“We’ve spent quite a bit of time researching partnerships that will give us brand recognition in the market,” says Graetzer. “It’s an absolute change for us to be able to create what we believe to be a unique space in the market. “
This unique space, says Graetzer, is the “Maxim lifestyle,” which he describes as ambitious and characterized by celebrities, VIPs, influencers and “amazing parties”. MaximBet’s first party will be in Denver on Halloween day, and Maxim will have his annual Super Bowl party in Los Angeles in February.
Kai Olderog, senior vice president of operations at Maxim, said the company expects gaming to be a bigger part of the company’s future. “Sports betting is big business,” says Olderog. “We hope and anticipate that sports betting is an important part of our future.”
It wouldn’t be the first time Maxim has been tempted to enter the gaming world. In the early 2000s, long before Biglari owned the company, Maxim and a developer in Southern California announced their business. intends to open a hotel-casino in Las Vegas. However, the deal fell apart.
Maxim follows other media brands in the world of vices in order to diversify its income. Sports Illustrated, the 67-year-old media company owned by Authentic Brands Group, struck a deal in June with an online gambling company to launch its mobile sports betting app. (SI Sportsbook also launched in Colorado earlier this month and will expand to Indiana, Iowa, and New Jersey over the next few months.)
In May, The Associated Press struck a deal with FanDuel to make the sports betting company its exclusive provider of sports odds in AP’s World Sports Reports. In August, the Wall Street Journal reported that Disney-owned ESPN is in talks to explore a possible brand licensing deal with Caesars Entertainment or DraftKings that could be worth $ 3 billion.
The sports betting industry is on fire and there is a lot of money to be made. Americans wagered $ 1.85 billion with legal sports betting in the first half of 2021, according to data from the American Gaming Association. This year has already passed last year when Americans bet $ 1.53 billion. By 2030, Macquarie Research says the same market could be worth $ 30 billion.
On Tuesday, Carsten Koerl, founder and CEO of Switzerland-based Sportradar, which helps sports leagues compile data such as gaming statistics to distribute to media companies and betting operators, became a billionaire after his company was shut down. went public on the Nasdaq.
Granted, Carousel is still a small startup in a market dominated by multi-billion dollar companies. In April, it raised a $ 50 million Series A funding round from a subsidiary of Chinese steel pipe company ZK International Group Co., Ltd. for a valuation of $ 200 million.
As for Maxim, which Biglari bought through Biglari Holdings for around $ 12 million in 2014, gambling represents a new source of income in a struggling industry. Maxim generated $ 709,000 in revenue in the second quarter of 2021, up from $ 982,000 in the first quarter.
In its quarterly report, Biglari Holdings said it bought Maxim with “the idea of transforming its business model” by creating “non-magazine” revenue, through “the licensing of a cash-generating business linked to the products of consumption, services and events “. The deal with Carousel is just that.
But Maxim doesn’t stop at sports betting. It is also pursuing other trends to diversify its income, including the burgeoning world of non-fungible tokens.
“We just launched MaximNFT, which will feature NFTs from people who make pop culture including musicians, artists, celebrities and sports stars, as well as our own NFTs,” Olderog said.