The American Gaming Association predicted last year that Americans would bet $95 billion on NFL and college football games in 2015. That's billion, with a B.
America's appetite for sports betting is massive, with an estimated 118 million people a year gambling on the outcome of games. And that doesn't even take into account daily fantasy sports sites like Draft Kings and Fan Duel, where fans spend tens of millions in entry fees.
But aside from daily fantasy, legal sports gambling in Las Vegas, illegal sports betting sites and bookies, there's another popular form of gambling that's almost impossible to track: sports betting between friends.
Since practically the beginning of organized sports, fans have been gambling on games with their friends, wagering $10 here, $20 there on if the Bears will beat the Packers, if the Bulls will cover the spread against the Heat, etc. The loser pays up (usually) and no money is exchanged online or with a third party.
But a new app in Chicago wants to bring tech to bets between buds by providing a platform that tracks your gambling and directs the loser to the winner's Venmo account to settle up. And its founder says it's completely legal.
Bait wants to give sports fans a place to gamble on games without needing to sign up for a sketchy online gambling site, play against a stranger thousands of miles away, or try their hand at daily fantasy, which heavily favors the top 1% of players.
Bait, which is currently in beta and aiming to launch in the coming weeks in advance of the NFL season, syncs with a user's phone contacts and lets you bet head-to-head against people you know. Pulling in the betting lines from Vegas, users can bet their friends on the spread, the over/under, or who's going to win. Players can chat in the app while the game is going on, and Bait automatically notifies the winner and loser once the game ends. The loser then clicks the "pay" button, and they're taken to the winner's Venmo page.
Bait gets around the illegal sports gambling label in a couple of ways. First, the loser doesn't have to pay up. The app doesn't deduct anything from your account, and there's no financial penalty for failing to pay. Much like a verbal agreement between friends, it's up to the parties involved to follow through on payment (but users are rated--like Uber--and your rating will be negatively affected if you don't pay).
Second, Bait doesn't take a percentage of the money that's exchanged. The startup plans to make money through sponsored ads, founder Ian Peacock said, so its goal will be to acquire as many users as it can--a tall task for a small startup competing for similar users as Draft Kings and Fan Duel.
But Peacock, who came up with the idea while a student at the University of South Carolina, says Bait can get a big audience by appealing to the social side of gamblers, and those who might be wary of illegal betting sites.
"It's social and it's fun, and it makes games more interesting," Peacock said. "You’re not going to be betting with people you don’t know. It's just fun and safe."
The daily fantasy sports industry is facing the potential of increased regulations across the US and especially in Illinois, where Attorney General Lisa Madigan has ruled that daily fantasy sports are considered illegal under the state's gambling law. In fact, Chicago startup SportsLock temporarily pulled its fantasy app from the App Store earlier this year amid the legal turmoil for the industry.
But Peacock says Bait sidesteps the concerns facing daily fantasy sports companies.
"There's no risk in our app," he said. "You never actually risk your money. You decide what happens."
When the app goes live in a few weeks, Bait plans to let people wager on college football, NFL, college basketball, NBA, and hockey, and it expects to add golf in the coming months, Peacock said.
