LAS VEGAS — The ticket cost $50, but its potential value was $250,000. Four more Loyola victories, and it would be cashable. Someone offered its owner $10,000 for it — a guaranteed return of 200 times the investment.
What would you do?
A PropSwap client wanted $15,000 last Saturday morning, so no deal. Three hours later, that ticket became worthless when the Ramblers lost to Oregon State.
I hope, PropSwap co-founder Ian Epstein texted Sunday, he put something on the Beavers’ moneyline.
For Chicago natives Epstein and Luke Pergande, who created PropSwap as a hedging alternative, that was a unique slip of paper.
”One of the craziest tickets I’ve ever seen,” says Epstein, who a few days earlier had met that client at the Mirage, where he had made the 5,000-1
wager in November.
With such exorbitant odds and such a potential payoff, Epstein needed the sportsbook to verify the ticket, which it did. But $5,000 would separate the parties.
Another PropSwap customer had a $50 ticket on Loyola at 1,500-1 odds, making its potential value $75,000. Before the game Saturday, he accepted $4,700 for it.
PropSwap has cornered the secondary sports-betting ticket market, aiming to
ensure profit for sellers and to provide better odds than are currently available to buyers, taking a fraction from both sides.
”This is the type of situation why we started the business,” Epstein says. ”If you’re a $50 bettor and you’ve got this great ticket, how else are you supposed to lock in $4,700?
”You don’t have the money to go bet the
Oregon State moneyline and then, if that
loses, to go bet another moneyline, then
another . . . ”
The four-week period that encompasses the NCAA basketball tournament and the Masters golf tournament is PropSwap’s wheelhouse, a flurry of ticket and money exchanges that represents the zenith of the company’s fiscal year.
A year ago, when the coronavirus pandemic nearly shuttered the entire sports world, PropSwap took a gut punch. Fortunately, Epstein and Pergande had built it to weather certain scenarios.
For example, they are its only two full-time employees and receive modest five-figure
salaries. For two people who pumped their life savings — and then some — into PropSwap, that’s hardly profligate.
Two months earlier, they had attracted more than $2 million from a wealth of
investors. And despite the nearly four-month sports pause, PropSwap experienced record figures in bookings, revenue, new users and engagement in 2020.
A month ago, investors renewed their bullishness in the business with a further infusion of $2 million.
Sports betting is legal in 20 states and Washington, D.C., and PropSwap transacts business in 17 jurisdictions. The duo constantly excavates fertile territory, plans promotions and polishes education programs.
The 32-year-old Pergande, who went to Maine South in Park Ridge and lives in
Atlantic City, New Jersey, is exploring casino partnerships. The 31-year-old Epstein, an Evanston graduate, has new app and website designs on track to launch this summer.
”Luke and I have had this vision to keep improving,” the Las Vegas-based Epstein says. ”The people who have invested in the company see it, too.”
Part of that vision is 20 tons of metal, glass and rubber, a Southeastern Pennsylvania Transportation Authority (SEPTA) bus that is emblazoned with mammoth, in-your-face, green PropSwap signage.
For a mid-five-figure sum, the ”PropSwap Bus” began circulating around Philadelphia, which has the sixth-largest public-transit system in the country, three weeks ago and will do so through the start of the football season.
Epstein and Pergande also boosted PropSwap’s imprint in Indianapolis, Cleveland, Chicago and Las Vegas and have commissioned its first TV ads for the New England region.
”It’s pretty freakin’ cool,” Pergande says of the bus. ”We’re in a marketing puzzle, and we have to find creative ways to get the word out, to find our niche.”
Epstein has heard rumblings about potential competitors, but nothing has surfaced. He had learned of such a start-up in London.
”But, to my knowledge, their website is no longer up and running,” he says. ”Luke and I work as hard as if there are two guys in a
garage, trying to start a competitor. That’s what keeps us motivated.”
‘EVERYONE HAS 50 BUCKS’
Before PropSwap, the sole ”hedging”
option for the bearer of that $250,000 Loyola lottery-like ticket involved betting against the Ramblers, on opponents who — best-case scenario — were moneyline underdogs.
Continued Loyola victories, obviously, would require increased investment on the foe to secure a profit. That could turn into an unruly rabbit hole, which, since 2015, could be averted via PropSwap.
That is, unless a profit 200 times face value doesn’t sound so appealing. Greed is not good.
”The biggest ticket we’ve ever had,” Pergande says. ”We’ve had large tickets, but the initial bet amount was $1,500 or $2,000. The average gambler doesn’t have that much money to put on a sports bet, but everyone has 50 bucks.
”That is why [Loyola for $250,000] is my favorite ticket we’ve ever seen.”
The value of March Madness tickets on PropSwap is exceptional. One to pay $250,000 on Dustin Johnson, say, to win the Masters won’t materialize, but the number of tickets on the golf tournament will be massive.
”The volume with the Masters is incredible,” Pergande says. ”March Madness and the Masters are just perfect for PropSwap. This is it, our Super Bowl.”