The Hidden Cost of Sports Gambling

For every $1 a person bet on sports, it reduced their net investment in stocks and other financial instruments by $2.13

Author

Kieran Ryan
August 29, 2024

Good morning, Nerders. It’s Thursday, August 29th. In today’s newsletter, we cover:

  • Sports Gambling — A new study shows those who participate in sports gambling tend to invest less and have higher debt levels

  • Software Spend — Public SaaS revenue growth slows

  • Economic Indicators — What sausage sales and men’s underwear tell us about the economy

TODAY’S STORY

The one thing Americans love more than sports? Gambling on it.

Americans wagered a record $119.8Bn on sports in 2023, up 27.8% from 2022.

But legalizing sports gambling comes with a cost.

Those who participate in sports gambling tend to invest less and have higher debt levels. At least that’s what a recent study concluded after analyzing 230K households across states that have legalized sports gambling:

  • Net investments in states where sports betting was legalized fell ~14% in 2-3 years

  • For every $1 a person bet on sports, it reduced their net investment in stocks and other financial instruments by $2.13

  • Low savings households reduced their quarterly total credit card payments by $890 following betting legalization 

Sports gambling is booming, but the real gamble is folks deferring money that could have been in their investment portfolios.

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DATA BYTES

  • The median revenue growth for the top 50 U.S. public SaaS companies fell from 36% in Q2 2022 to 20% in Q2 of this year

  • Many companies are cutting software budgets as part of broader company-wide cost reductions and reserving cash to invest in new initiatives such as generative AI

#SHORTS

What sausage sales and men’s underwear tell us about the economy

@boringbusinesskieran

What sausage sales & men’s underwear tell us about the economy ⚠️ // Make sure to follow me to keep up with the latest business stories an... See more

What’s Happening Today in Business

  • Monday, August 26th — Costco opens its first store in Okinawa, Japan, U.S. Open’s $23 cocktail, Telegram Founder arrested in France

  • Tuesday, August 27th — Kelce brothers ink $100MM podcast deal, Apple’s CFO steps down, Circle K’s owner makes a bid for 7-Eleven’s Japan holdings

  • Wednesday, August 28th — Nvidia reports earnings after the bell, Lowe’s backs off DEI initiatives

If you have any comments or feedback, just respond to this email.

Thanks for reading,
Kieran & Justin Ryan