Salerno plans on pari-mutuel fantasy sports
March 22, 2016 3:00 AM
by Phil Hevener
Hall of Fame bookmaker Vic Salerno says he is ready to rock and roll with a spin on fantasy sports betting that will bring the promise of million dollar prizes to Nevada bettors using a pari-mutuel platform.
Unlike other fantasy sports operators, Salerno has no problem with the requirement he go through the process that will give him and his company, U.S. Fantasy or USF, a Nevada sportsbook license. He expects to be on the Gaming Control Board agenda in the spring and assuming he does not stumble along the way will be up and running in time for football season.
Salerno is being joined in the venture by Mike Knapp, another veteran of the bookmaking business and Bob Kocienski, a former executive with several major casinos. Knapp, came to him with the idea about 10 years ago.
“Mike’s suggestion was that we put fantasy sports betting and horse racing together in a pari-mutuel format. All we do is substitute human athletes for horses.” Thinking about that for a moment he adds, “It is so easy I’m surprised no one has tried it before now.”
Salerno agreed 10 years ago that it was an intriguing idea but there were other things going on then as he was expanding his sports and racebook business across the state. They ended up putting the idea down for a period of time.
They agreed the time seemed right to look more closely at Knapp’s suggestion after Salerno completed the sale of his American Wagering to William Hill in 2011 and the daily fantasy wagering business began to catch fire thanks to the high octane marketing efforts of companies like FanDuel and DraftKings, companies that backed away from Nevada when they were informed by the Control Board that sportsbook licenses would he required since this was obviously gambling.
Whether the daily fantasy sports business is or isn’t gambling or a game of skill, as FanDuel and DraftKings, like to insist it is, does not matter in Nevada. Call it what you will but get the necessary licenses they were told.
Thanks but no thanks, the two companies responded, making it clear they see Nevada licensing requirements as a bit too onerous for them. But Salerno as a long time licensee, first at his Leroy’s Sports and Race Book and later as a senior executive at William Hill after the 2011 buyout, had no problem with the requirement and filed his application late last year.
Salerno was a successful Southern California dentist with an interest in the gambling business when he moved to Las Vegas in 1978 and eventually took over his father-in-law’s Leroy’s.
He quickly spotted opportunities for modernizing the business, creating one of the first computerized systems that allowed books to know what was happening in real time.
It was his idea for mobile apps and kiosks that took the business closer to its customers and helped make the biggest difference since the turn of the last century. Which brings us back to Salerno’s daily sports pari-mutuel platform.
Salerno is certain it will appeal to the most elusive generation – millennials, the 26-38 age group. Fantasy sports is the proven choice of the millennial generation. As a result, Salerno believes USF will satisfy a burgeoning client base.
Nevada sportsbooks reported a total handle of $984.6 million in 1984, but all the factors that combined to fuel the public’s fascination with sports betting drove the state’s total handle to $4.2 billion in 2015.
Sportsbooks were flashing a lot of creativity and Salerno, with his strong sense of how to use new technology to benefit his Nevada business, was among the most successful, a fact that had everything to do with the decision to add him to the Gaming Hall of Fame last year.
As the sports betting business was continuing to generate bigger numbers, Salerno and Knapp were quietly going around talking with tracks about what the new company might have to offer.
Some California tracks wanted him to begin immediately but Salerno still had work to do on the home front talking with regulators in Nevada about his efforts to put together a business plan that would guarantee success.
“Our idea was to have the tracks in California be our distributor. We knew that would be tremendous considering there are almost 40 million people there.”
One of the things Salerno wants to do is get the same exemption from Congress that racing enjoys for pari-mutuel wagering that allows OTB action across state lines. He has been in touch with a Nevada legislator who has agreed to help with that.
One of the big promotions Salerno is already talking about will be a Pick (7) with a guaranteed prize of at least $1 million. How would it work?
USF will be listed with all the other pari-mutuel tracks. Mimicking traditional fantasy sports, the fans would pick a quarterback in the first “race.” Picking two wide receivers, a running back or two would be the second, third and fourth “races” and so on down the line. Salerno anticipates the placing of (win, place, show) exactas and daily doubles, the same wagering anyone could enjoy at a racetrack.
“It’s so easy,” Salerno stresses, “just substituting the names of players for horses. We have identified over 11,000 events to run annually, thus covering daily business.
USF wagering opportunities will be available in Nevada through the same dissemination system that brings the TV signals from live races around the country into local race books. There will be a “substantially lower take-out” compared to horse racing.
Salerno imagines teams and leagues will be impressed with the transparency, fairness and regulatory efficiency of the pari-mutuel format that makes ever-changing lines visible to everyone as the money flows this way and that.
Phil Hevener has been writing about the Nevada gaming business for more than 30 years. Email: PhilHevener@GamingToday.com.