PropSwap

Operating as a secondary marketplace for sports bets, PropSwap, Inc. provides a platform for individuals to buy and sell active sports wagering tickets. The company was co-founded in 2015 by Luke Pergande and Ian Epstein and is headquartered in Las Vegas, Nevada. The concept for PropSwap emerged in 2013 when Pergande, a former financial analyst, placed a 50/1 futures bet on the New Orleans Saints to win the Super Bowl. As the Saints' season progressed successfully, the odds shortened dramatically to 15/1, increasing the ticket's value. Pergande sought a way to sell his valuable ticket and lock in a profit, leading him to contact Epstein, who was working in risk management for a Nevada sportsbook. Recognizing a gap in the market, the pair launched PropSwap after presenting their business model to the Nevada Gaming Control Board.

PropSwap's business model is analogous to online marketplaces like eBay or StubHub, facilitating peer-to-peer transactions. It generates revenue by charging a commission fee to both the buyer and the seller. Sellers are charged a 10% commission on the sale price, while buyers are charged 3%. The platform caters to sports bettors across the United States, allowing anyone to list a ticket for sale, while purchasing is restricted to users in approved states. The service provides a distinct value proposition for two types of clients: sellers who can secure a profit or minimize a loss on an existing bet before the event concludes, and buyers who can access odds that may be more favorable than those currently offered by sportsbooks. This model introduces a different approach to sports betting, where a wager doesn't need to win for the bettor to make money; its odds simply need to improve.

The platform's functionality requires sellers to upload a picture of their physical or digital betting slip. Once a ticket is sold, PropSwap verifies its authenticity with the issuing sportsbook. For physical tickets, the seller mails the slip to PropSwap, which holds it on behalf of the buyer until the event outcome is known. Winning tickets are then sent to the buyer, who is responsible for cashing them. The company's growth was significantly boosted by the 2018 Supreme Court decision to overturn the Professional and Amateur Sports Protection Act of 1992 (PASPA), which previously restricted sports betting primarily to Nevada. This ruling enabled PropSwap to expand its operations nationwide, leading to a surge in ticket supply and user growth. The company has secured over $4 million in funding, including a $2 million round in 2021, to fuel product development and expansion into newly legalized states.

Keywords: secondary market, sports betting, peer-to-peer marketplace, betting exchange, ticket resale, futures betting, parlay betting, sports wagers, online marketplace, Las Vegas startup, betting odds, hedge bets, sports gambling, Luke Pergande, Ian Epstein, P2P betting, sportsbook tickets, cash out bets, sports investment, PASPA