In the end, the Floyd Mayweather won his fight against Conor McGregor, pushing his record to 50-0, as most expected.
The house won and corporate spreadsheets will reflect yet another profitable weekend for Las Vegas sportsbooks. But in what will end up being the most-bet fight ever, with estimates from sportsbook directors as high as $85 million in handle, achieving that typical outcome was far from routine for oddsmakers.
“We thought we had it all figured out from the very beginning, but that was obviously not the case,” Jay Kornegay, vice president of race and sports operations at the Westgate Las Vegas Superbook, told ESPN with a chuckle.
Much like Mayweather did against McGregor, oddsmakers relied on valuable experience to stay nimble against a giant unknown and earn a lucrative victory while denying the masses their Vegas dream.
“There was a moment after Round 2 [when] I was envisioning all the disaster scenarios,” CG Technology vice president Jason Simbal said. “I kept saying to myself that Mayweather is 40 and McGregor is more skilled than I thought. It was certainly nerve-wracking.”
Potential sportsbook losses grabbed national headlines throughout fight week, given the parade of McGregor (+375) bettors seeking a large payout to defeat Mayweather (-475). Approximately 16 of 17 tickets backed the Irishman, driving down the odds all summer.
“Just look at the celebrities around the ring,” William Hill director of trading Nick Bogdanovich said. “The fight was all anyone could talk about it and they bet it with both hands.”
Las Vegas had seemingly seen it all, except this: the unconventional bout of a legendary boxer past his prime against a UFC champion who had never boxed professionally. This bizarre occurrence, heightened by their unparalleled fame and eccentric personalities and a void on the sports calendar, produced unpredictable betting behavior with historic handle.
“There has never been an event quite like this,” Westgate Las Vegas Superbook oddsmaker and manager John Murray said. “You have total novices that would never normally bet boxing. We had lines for 13 hours on Saturday.”
So what lessons, if any, did Vegas bookmakers learn from the fight?
Initially, the public predictably followed the status quo by backing the underdog. After all, no one visits Vegas to lay odds, instead preferring an underdog with a larger payout. However, the interest surpassed expectations and McGregor received support at an overwhelming rate.
“We learned the public is more willing to overlook statistics and take a shot with a big payout,” Jay Rood, vice president of MGM Resorts race and sports, said. “I can see it at +700 but it was surprising at +300.”
For the most part, those tickets served their purpose. McGregor bettors were “rewarded” with the emotional high of a potential payday, adding more entertainment to watching the fight. All that played into the hands of experts.
“When the masses are involved, that money in the pot is fine. We’ll take our chances,” Bogdanovich said.
Bookmaking is not for the risk-averse. Oddsmakers embrace significant exposure if they believe they possess the advantage, much like “pot odds” in poker. This fight was the largest sports decision in William Hill US history.
“You’re never going to get into a position where everything is balanced. That’s in a textbook and classroom,” Rood said.
So oddsmakers did what they normally do: trust their handicapping over the clueless and emotional public. The big difference in this case is that the financial liability was amplified by the underdog’s significant payout and ticket count. This would have been the largest loss ever on a single event for nearly every sportsbook.
“Everybody has a different number in mind that they can stomach,” Kornegay said. “We had ours. We were trying to mold this thing to a comfortable range, which we ended up doing.”
That comfort level varied, depending on conversations with executives high on the food chain. Millions riding on this unique and historic sporting event warranted that rare dialogue, ensuring all bases were covered.
“We sent an email explaining our suggestion on how we handle this and they agreed,” Simbal told ESPN. “We’re either going to take a position or blow our win-loss ratio.”
This made for a betting frenzy in the final few days. In addition to the constant flow of McGregor money, Las Vegas sportsbooks saw six separate bets of at least one million dollars on Mayweather.
“That type of volume on both fighters is gold,” Kornegay told ESPN. “Obviously, it would be more difficult if it was lopsided one way or another. But you’re getting pretty decent action on both sides. [That is] a bookmaker’s dream.”
“If I had to do this all over again, maybe we could try to get the Mayweather bets before they bet it at other places,” Simbal said. “There’s only so much six-figure action out there.”
Additionally, sportsbooks were able to massage their odds to achieve their optimal strike price of needing Mayweather, while not exposing them beyond their predetermined liability. “In many cases, it was a very easy fight to book because of the volume,” Kornegay said. “You could just go off market for either fighter, which makes it very easy.”
“Maybe if I had one thing to do differently, I would have moved the line a bit more quickly,” Rood said. “But our experience also shows this pattern exists and we don’t want to give away the value of Mayweather and put us on a position we don’t want. I’d rather be in the position [I was in], needing a guy that’s 49-0 than needing a guy that’s never boxed before”
Patience was rewarded. Sportsbooks avoided an early panic from significant underdog liability and maximized their profits in what could be a collective return near eight figures.
“[It was] one of the biggest boxing wins [for our sportsbook],” Rood told ESPN in a text message after the fight. Management gives bookmakers extreme latitude, justified by their industry experience and sports acumen, even as they are desensitized to the millions at their fingertips.
“The key is to be consistent and steady with what you’re willing to do,” Rood said. “It’s not as romantic as everyone thinks.”
“I’ve been through the ringer a million times,” South Point oddsmaker Jimmy Vacarro said, citing his four decades of bookmaking experience. “The key to longevity, especially in a racket like this, is never to second-guess yourself.”
Ho-hum. Another win for Vegas and another win for Mayweather. Their collective record together remains unblemished.
“If we’re going to write a billion dollars in a year, all a loss does is set you back a little bit,” Bogdanovich said. “Just business as usual.”