Flamengo, one of Brazil’s most loved football clubs, is contemplating the launch of its own betting platform “Flabet”, breaking away from traditional sponsorship deals.
Flamengo is set to present the Flabet proposal to the club’s Deliberative Council. This club is to set a licensing agreement with Pixbet, Flamengo’s current master sponsor, which would operate Flabet. If approved, Flamengo stands to earn a minimum of R$82.5 million (nearly $15 million) over the next four years.
Ambitious projections
The financial projections are ambitious. Under the proposed deal, Flamengo would earn R$10 million ($1.7 million) in 2024, R$22.5 million ($4 million) in 2025, and R$25 million ($4.5 million) each in 2026 and 2027. The club’s board has even expressed optimism that revenues could surpass these projections, given Flamengo’s vast fan base and extensive digital reach.
Flabet would not be limited to bets on Flamengo alone. It is designed to offer wagering options on various teams and sports, positioning itself similarly to existing betting platforms.
Unprecedented in Brazil
A football club licensing its brand to a betting operator is unprecedented in Brazil. However, it aligns with global trends where sports organisations explore diverse revenue streams through brand partnerships.
Legal and regulatory considerations
Under Brazil’s Law 14.790, which governs sports betting, operators are generally prohibited from holding direct or indirect stakes in football clubs or professional sports organisations. This law aims to prevent conflicts of interest and ensure the integrity of sports and sports betting.
Critics, including Rafael Marchetti Marcondes, legal director of the Brazilian betting industry association IBJR, argue that the Flabet arrangement could be seen as an attempt to circumvent these regulations. Marcondes contends that allowing such a partnership could set a troubling precedent, potentially undermining the regulatory framework designed to prevent match-fixing and corruption.
Despite these concerns, Pixbet is expected now to apply for a federal license. The broader legal interpretation and application of federal licensing rules will be crucial in determining whether the Flabet proposal can proceed without violating existing regulations.
For Flamengo, the creation of Flabet could offer a considerable new revenue stream. With more than 59.5 million followers across major social media, Flamengo’s promotional power could drive substantial traffic and engagement for Flabet.
As Flamengo’s Deliberative Council prepares to vote on the proposal, the outcome could potentially influence similar ventures by other football clubs and sports organisations in Brazil.
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