FanDuel CEO Says Next California Sports Betting Effort Will Be Unified Approach With Tribes

Howe took the stage Tuesday in Anaheim, California, at the Indian Gaming Association Convention with California Nations Indian Gaming Association Chairman James Siva and Pechanga Development Corp. Director of Public Affairs Jacob Mejia.

At the Anaheim Convention Center across the street from Disneyland, you might say she was getting on a roller coaster without a safety harness.

It was the biggest gesture in FanDuel’s effort to make amends with California Indian tribes after an acrimonious 2022 ballot campaign over sports betting.

Mejia gave Howe credit for being the first CEO of one of the major operators to show up for a tribal forum after the 2022 election.

“Thank you on the one hand,” Mejia said. “On the other hand, you know what they say about the first person through the wall.”

Howe took the ribbing in stride and addressed the 2022 failure, in which Prop 27 received only 17.7% of the vote, with humility and humor.

“It’s a real privilege and an honor to be one of the first CEOs to be here after what was, we can joke about it, it was a spectacular fail.”

FanDuel CEO addresses tribal sovereignty

The discussion was titled “Tribal Sovereignty in the New Frontier of Sports Wagering.” So Mejia started it off by asking Howe how she defined sovereignty. Howe responded:

“We believe it’s the inherent authority for the tribes to be able to govern themselves. What does that mean? That means the ability to govern what they have preserved and built over generations. The cultures, the traditions and, perhaps most importantly in the context of this conversation, to protect and prepare their people for the next generation. As we think about tribal sovereignty and protecting the economic future of generations, we hope and believe we can be an important partner and ally in helping tribes to navigate that.”

California tribes felt Prop 27 violated their sovereignty and exclusivity over gaming in California. So Mejia next asked what exclusivity means to FanDuel now.

Howe said that was one of the most important lessons of the ballot campaign.

“If legalized wagering is going to be done in California, it is going to be done with and through the 100-plus tribes that exist in the state of California. It’s critical for us to do this together and not against one another.”

What else FanDuel learned from California ballot failure

Howe said FanDuel learned a lot from the Prop 27 disaster, particularly after bringing in three people with inside knowledge of tribal perspectives to form a strategic partnerships division.

Rikki Tanenbaum and Frank Sizemore worked for the San Manuel Band of Mission Indians, which spent the most money of any California tribe to defeat Prop 27. Howe held up Sizemore’s notebook from those days, which had a “No on 27: A Bad Deal for California” sticker below another sticker with FanDuel and DraftKings crossed out. In February, FanDuel hired former National Indian Gaming Commission Chairman E. Sequoyah Simermeyer, who recently spoke with PlayUSA about the move.

“I always say, good leaders know what they don’t know and we clearly didn’t know a lot coming out of that initiative. I look over here to Rikki, Frank and Sequoyah, and they’ve really helped us navigate.”

Three lessons highlighted by Howe:

• Tribes will determine when and how this happens, and the role sports betting operators like FanDuel will play.
• With more than 100 tribes in California, it’s going to take time to figure out how to do sports betting to everyone’s benefit.
• Voters have to be ready for sports betting, and tribes are well-respected by residents of California.

“So having one unified approach that we can all get behind together that the voters understand is going to be critical for the ultimate success of this,” Howe said. “I think there’s no way it can pass without broad tribal consensus. It’s a really important lesson, and that was an expensive lesson for us to learn.”

California will eventually legalize sports betting and online casino

Siva said tribal leaders are willing to have these discussions with operators such as FanDuel because they know California online casinos and sports betting are the future.

“Expansion of gaming is going to happen. It’s a matter of when, not if. But when that does happen, tribes are going to remain in control. We will partner with companies, we will utilize products. But tribes are the operators in California, period. That’s it.”

CNIGA has been leading discussions among California tribes on how best to move forward with sports betting to the benefit of all.

“In California, every single tribe should benefit from gaming. How do we tie the past with our present situation looking toward the future. … All of our brothers and sisters, we go together. Saying that is easy, actually doing it is very difficult. But that’s what we are going to do. We have the destination, now we’re just carving the path to get there.”

Howe respected that commitment for all 110 California tribes to benefit from sports betting.

“I think that the notion of lifting your brothers and sisters is a beautiful one, and personally incredibly motivating to me to think about us potentially partnering to do that. Sometimes people look at companies like FanDuel and think we’re only economically motivated. But what you just said really resonates.”

Howe said California can and should be the greatest sports wagering market in the world. And that there is a lot of revenue that should be going to tribes today that is instead going through illicit operators. The American Gaming Association estimates that figure to be around $4 billion.

“So I think if we can work together and figure out a structure that goes through the tribes but also takes full advantage of what we’ve built over not just six years of being an operator of online sports betting in the US but we’re also backed by the largest global gaming company, there’s something really powerful that we can do together.”

Keep updated with the latest casino legislation news with our dedicated Online Casino Bill Tracker.

Tribal advice to online sports betting operators

Siva didn’t mince words in his advice to FanDuel and other operators:

“I would say be patient. Listen to the tribes. We know where we want to go. We’ve seen efforts in the past to come in and divide and conquer tribes. As you’ve seen, that was not successful. We’re making new relationships moving forward, but we don’t forget. We remember. So I would say get out of our way. We know what we’re doing. This is our industry. Get out of our way and we’ll show you the path.”

Following the panel, Howe spoke to PlayUSA about how she felt the discussion went.

“Listen, I really appreciated the opportunity to represent sports betting operators and, as I said, it’s a real privilege and an honor to be here. The better question is for folks in the audience. How do they think it went?”

She went on to explain:

“We knew that coming out of the November ballot issue it was a reset moment for FanDuel and for the industry. I think we’re a pretty humble organization. We knew we failed, like I said pretty spectacularly by the numbers. And we’ve been doing the hard work starting with hiring an amazing team with Rikki, Sequoyah and Frank. We’ve been trying to just listen and learn as much as possible before we jump back into coming up with solutions. Because as I said today, at the end of the day, if legalized sports betting is going to be successful in the state of California, it’s going to be through and with the tribes not against the tribes.”

In 2022 at the Global Gaming Expo in Las Vegas, as it became apparent that Prop 27 was headed toward defeat, Howe irked tribes when she said, “We absolutely live to fight another day.”

Mejia threw the wording back at her later in the day, responding, “If you fight with the tribes, you’re losing.”

Howe and FanDuel have come a long way in Mejia’s impression. Following the panel, he had this to say of Howe:

“Very sincere. It was refreshing to hear that they’ve taken stock in the outcome of the election and to reflect on what happened. It sounds like they’ve learned some lessons. But, as people have already said, the proof is in the pudding.”