Penn Entertainment’s purchase of Barstool Sports is showing signs of growing pains.
Barstool host Ben Mintz was fired by Penn for saying a racial slur as part of a song lyric during a livestream last week. Barstool president Dave Portnoy announced the news on Twitter – and this is key – added that Penn made the decision.
“By the way for everybody saying Barstool is dead to them I knew this would happen,’ Portnoy wrote on Twitter on Wednesday. ‘I said it’s so against everything we stand for that it could be a death blow. Penn understood this. They still did it. That’s how frightened they were of regulators who operate with no impunity.”
Penn’s stock, which was trending well all week, dropped after the news broke to its lowest price since May 2020. The drop represented, per analytics firm Action Network, $633 million lost in Penn value. (For context, it bought Barstool for about $551 million.) Criticism of Penn was swift in some circles: fans rushed to defend Mintz, who apologized for saying the racial slur.
Firing talent is perhaps not what Penn expected when it purchased Barstool, a deal that closed earlier this year. As we wrote about a few months ago, Penn bought Barstool and received a host of controversy on the side. As an independent media brand, Barstool’s personalities frequently did what they liked, whether it ran afoul of regulations or of mainstream opinion. But now that they’re part of a big, hulking corporate entity like Penn – which operates in the closely-regulated sports betting sector – things are changing. Penn has to be seen as taking action, even if that action may alienate the very customers it hopes to attract.
A clash between Barstool personalities and Penn’s corporate business has been an ongoing issue. In March, a tweet from Barstool Sportsbook showed Dan “Big Cat” Katz, a key personality at the company, hitting a table with a baseball bat. People on social media criticized Barstool for promoting violence, irresponsible messaging, and so on, going as far as to report it to the National Council of Problem Gaming. In March, Massachusetts also ruled that it planned to have a hearing concerning a Barstool promotion from Katz, known as “Can’t Lose Parlays,” to see if it broke any rules. (The hearing was canceled in April after Barstool stopped using the phrase.)
For brands that acquire publishers, they may get a goldmine of audience attention as the upside. But they also may be acquiring a company’s own ways of working, particularly when it’s a loud, brash brand like Barstool.