With 10 games remaining in Major League Baseball’s regular season, Miami Marlins slugger Giancarlo Stanton trailed Nolan Arenado in the RBI standings by five. At the beginning of the season, Joe (not real name) placed a $520 wager at the Hooter’s Casino in Las Vegas at 18:1 odds that Stanton would lead all of MLB in RBI. The potential profit: $9,360.
The 6-foot-6, 245-pound Stanton has always been capable of leading any power category, if only he could avoid the disabled list. Due to a variety of injuries from 2012 to 2016, the 27-year-old played just an average of 115 games and no more than 145 in one season.
Stanton’s body held up in ‘17 and he continued crushing home runs — a league leading 59 — but nevertheless in late September he trailed powerful Rockies third baseman Arenado in RBI. Joe got nervous and turned to PropSwap — a Las Vegas-based marketplace for props, futures and straight bet wagers — to see how much he could fetch for the Stanton ticket.
PropSwap’s Marketplace for Sports Betting Tickets Sees Wild MLB Finish And Lots of Opportunity
The idea for PropSwap dawned on Ian Epstein in 2013. At the time he was an analyst at Cantor Gaming. His college buddy Luke Pergande had visited Las Vegas around Labor Day when he bet the New Orleans Saints to win the Super Bowl at 50:1 odds. After a red-hot 9-2 start by the Drew Brees-led Saints, sportsbooks listed them to win Super Bowl at around 15:1 in late November.
“I’ve got this ticket on the Saints” Luke told Ian. “Is there anywhere I can sell this thing?”
“No. There’s not.”
“Well, I made the bet, but if I send it to you and it wins, would they give you the money?”
“Yes,” Epstein said.
“Then obviously these tickets are transferable. There’s no one checking to see if the person cashing the bet is the person who made the bet.”
From there the pair made moves, but not without hurdles. They needed to ensure the idea was legally sound. So they met with a lawyer, and then 13 more lawyers, who all flatly rejected their proposition that betting slips were transferable, and therefore could be sold or exchanged.
Many of the lawyers said they wouldn’t even take the duo’s money to go make the case case, explaining “there’s no way that Gaming Control Board would ever allow this.”
But Epstein and Pergande persisted. They found Reno-based attorney Dan Reaser of the law firm Fennemore Craig, and Reaser took it to the Gaming Control Board.
“This is something that wouldn’t be regulated by us,” the board told them.
The result was that the tickets do not need to be regulated by the board. No red light was tantamount to a green light, so it was game on.
The Stanton-Arenado RBI Race Heats Up Down to the Wire While Bettors Get Cold Feet
With 10 games left in the season and Stanton down five RBI, Joe, who purchased the ticket in early May, felt a bit uneasy about how the race might unfold and wanted to profit from the investment. He listed the ticket for $4,000 and indeed wanted no less than four grand. So when he received offers for $2,000, he turned them down and held out hope for a Stanton surge.
On Thursday before the final weekend of MLB’s regular season, Stanton smashed two home runs and picked up three more RBI at home against Atlanta, tying Arenado at 129 RBI with three games to go.
Even though he liked where he was at, Joe wanted to walk away with at least $4,000, or about eight times his investment. Through PropSwap he found a buyer, Bill, who paid $4,000 to ride out the wager. And that’s a essential void that PropSwap fills: Joe would otherwise have had no way to hedge his bet. The sportsbooks don’t hang numbers for these props midseason or down the stretch, and even if they did, it wouldn’t make much financial sense to bet each of the next few players in the running. PropSwap created a marketplace for sports bets where no such opportunity for sellers or buyers previously existed.
When Sunday came, the last day of the season, Stanton led 131 to 130. And then Bill got nervous, like Joe before him. So he listed the ticket on PropSwap and found another buyer — Tom — who paid $6,500 for the the risk and thrill of holding the ticket on the final day with a one RBI lead. On Sunday, Stanton added one more RBI and Arendo zero, allowing Tom to cash the ticket for $9,880, netting a profit of about $3,400.
And of course the original buyer Joe made about $3,500 on his $520 initial investment, and Bill flipped the ticket and made $2,500 on his sale. Meanwhile PropSwap did $10,500 in sales, taking a 10% commission on each exchange, roughly the amount StubHub charges sellers for tickets to various games and concerts. It was a win-win-win-win for the bettors and PropSwap, and of course, an RBI title for Stanton.
The March Madness Market and Keeping Expectations in Check
PropSwap usually sees the most sales and action during March Madness. That’s when there’s volatility in the tournament and high-seeded longshots make Cinderella runs at tall odds. But in scenarios like these, where a No. 7 seed such as South Carolina reaches the Elite 8 (and later the Final Four), some sellers have unrealistic expectations. Epstein said:
“That’s been one of the unforeseen things about this business. I thought people would just be falling head over heels about the prospect of selling your ticket and locking in a profit. But that’s not the case. People make these long shot futures. They see the collect amount on their ticket and they want nothing less than that.”
In many if not most cases, sellers don’t know what their ticket is worth. PropSwap fields a lot of inbound inquiries asking, “Can you tell me what this bet would fetch?” This past March PropSwap got about 500 such questions and turned about 20% of the inquiries to sales.
“We’re trying to turn gamblers into investors,” Esptein explained. “Basically saying, look at this as an ROI thing. Don’t look at the number on the ticket. Think about the 700% return on investment that you’re about to make right now.”
Supreme Court Ruling and Possible Sports Betting Expansion Presents Big Opportunity for PropSwap
There’s a lot of opportunity on the horizon for casinos in New Jersey and many other cash-strapped states eyeing state-regulated sports betting as a source of tax revenue. That would translate into sportsbooks writing a lot more prop bets and futures tickets, and much broader client base for PropSwap.
The company has already established relationships with New Jersey, Pennsylvania, Massachusetts and Connecticut, where residents of each state may buy or sell tickets — only tickets bought in Nevada, of course. The out-of-state exchanges are not illegal because it’s a secondary market.
Those four states are also likely to be among the first to legalize sports betting if the Supreme Court rules PASPA — the federal law that effectively bans sports betting outside Nevada — unconstitutional. The high court has scheduled oral arguments in New Jersey’s case against the NCAA and professional sports leagues for December 4, with a decision expected in the spring of 2018.
Beyond the sale of props and futures tickets, Epstein sees a larger market for straight bets or spread bets, even in-game ticket exchanges. PropSwap has already rolled out functionality that allows customers to list tickets remotely by taking a photograph. (They must also provide a credit card as a form of insurance.) Previously sellers had to physically deliver their tickets. So it’s become much more of an online marketplace. Mobile sports betting apps, if and when they spring up in the event of sports betting expansion nationwide, probably would make the process even more streamlined.
Meanwhile, Epstein is betting on himself — and PropSwap’s future.
“I’ve quit my job and I’m devoted to this full time. I haven’t taken a salary yet, just living off of savings and credit cards. So, we’re in this all the way.”
