When Betting Goes Wrong: PlayUp's Australian Assets Face Their Reckoning

When a company founded with grand ambitions finds itself on the auction block, it’s usually a story of what could have been. PlayUp, an Australian gaming operator that once dreamed of becoming a global powerhouse in online betting, is learning this lesson the hard way. The company’s journey from innovation-focused startup to distressed seller tells a cautionary tale about the perils facing mid-tier gaming operators in today’s intensely regulated and competitive landscape.

A Once-Promising Player Stumbles Into Reality

Back in 2014, PlayUp launched with genuine innovation at its core. The company built its own proprietary technology platform, positioning itself to offer a truly integrated experience where customers could engage in everything from daily fantasy sports and traditional sports betting to slots, casino games, and esports, all in one place. For a while, that vision looked genuinely promising. Between fiscal 2021 and 2022, PlayUp’s gross revenue grew an impressive 56 percent year-over-year, demonstrating real market traction and consumer demand. By 2021, the company’s Australian wagering segment alone achieved gross gaming turnover of approximately AUD 255.9 million with net revenue of AUD 18.1 million. The company was heading toward what seemed like a sure path to becoming an international player capable of competing with established global betting operators.

But the company’s journey from rising star to distressed seller reveals the harsh realities facing mid-tier betting operators in today’s tightly regulated environment. According to a report from Next.io, PlayUp’s shareholders will vote on December 10 to decide whether to sell the company’s Australian gaming assets to CrossBet for AUD 18.6 million, roughly USD 12.11 million. The proposal, which was shared with investors on November 10, marks what appears to be a decisive turning point for the troubled operator. The timing of this vote comes after months of deteriorating conditions across multiple fronts, from regulatory battles to legal complications that have depleted the company’s resources and attention.

The Weight of Past Failures and Legal Nightmares

To understand why PlayUp finds itself in this desperate position, you have to look back at the spectacular collapse of what could have been a transformational deal. In 2021, the company appeared close to sealing a USD 450 million acquisition by FTX, the cryptocurrency exchange that seemed unstoppable at the time. That deal never happened, and what followed was years of legal warfare that would drain the company’s resources, distract its leadership, and ultimately shape the narrative around PlayUp’s viability as a standalone entity.

After the FTX deal collapsed, PlayUp sued its then-CEO, Dr. Laila Mintas, claiming she had deliberately sabotaged the transaction by making disparaging comments to FTX executives that turned them away. Mintas counter-sued, accusing CEO Daniel Simic of engineering the deal’s failure through internal mismanagement, conflicts of interest, and deliberate obfuscation. The legal battle became increasingly heated, with each side fighting over responsibility for the lost opportunity that could have transformed PlayUp into a major player.

Earlier this year, a Nevada court dismissed PlayUp’s claims against Mintas, effectively clearing her name of sabotage allegations. However, Mintas’s counterclaims remain very much active, and she’s now pursuing approximately USD 100 million in damages related to defamation and contract breaches. Her legal team points to comments made by PlayUp’s leadership and legal representatives that they argue damaged her professional reputation and career prospects. A significant portion of her claim focuses on the fact that companies became hesitant to work with her while the dispute remained unresolved.

Even more troubling for PlayUp, in July 2025, a federal judge ordered a forensic examination of Simic’s digital records after discovering potential evidence tampering. The court identified serious concerns about documents Simic submitted to the court, with evidence suggesting that key meeting notes had been altered or edited from their original form. Specifically, documents related to a November 2021 meeting with FTX showed stark differences between versions provided by Simic and versions obtained from board member Michael Costa. This revelation significantly strengthened Mintas’s position in the ongoing dispute and raised questions about the integrity of PlayUp’s leadership during this critical period.

When Regulators Shut the Door

While PlayUp battled its internal demons, regulators were tightening the screws from the outside. The company’s US ambitions, which once represented its biggest growth engine and a key part of its long-term strategy, have essentially evaporated. New Jersey regulators issued an emergency order in July 2023 revoking PlayUp’s sports betting license after the operator failed to comply with basic requests for financial information from the Division of Gaming Enforcement. The DGE specifically cited PlayUp’s inability to provide essential documentation including employee tax withholding records, bank statements covering multiple months, and payroll registers. PlayUp also announced it would shut down operations in Colorado, where it had only recently launched with what it hoped would be its American breakthrough. The company placed its licensed sportsbook into maintenance mode, with existing customers able to withdraw funds but unable to place new bets. The company didn’t fight these actions with aggressive appeals; it essentially accepted defeat in what it had hoped would be its American breakthrough.

These regulatory actions came after PlayUp had invested substantially in US market access. According to its financial reports, the company had paid USD 5 million in up-front fees to secure 10-year deals providing iGaming access in Pennsylvania and online sportsbook and iGaming access in Ohio. Those investments now appear to have been wasted, with no realistic pathway for the company to execute on those hard-won licenses.

The situation became even more embarrassing back home in Australia. In 2024, the New South Wales authority handed PlayUp the largest penalty in its history for illegal advertising practices. The company was fined AUD 586,000, approximately USD 392,700, after an investigation uncovered 33 instances of prohibited advertisements on its website, including illegal offers of free bets and other inducements designed to lure new customers. The advertisements violated core NSW gambling laws that explicitly prohibit offering incentives to open betting accounts or bet more frequently. Liquor & Gaming NSW made clear that such violations showed a fundamental failure of internal compliance processes. The fine surpassed the previous record of AUD 210,000 imposed on competitor Betr in 2023, underscoring the severity of PlayUp’s transgressions.

The Deal Terms and the Survival Question

Under the agreement with CrossBet, the Brisbane-based bookmaker will assume AUD 8 million in existing liabilities, which includes money owed to sporting bodies, government agencies, suppliers, and employees. CrossBet must repay the remaining AUD 7.5 million in instalments of AUD 125,000 per year over five years. But here lies the real risk for CrossBet: the entire payment plan depends on PlayUp remaining solvent after losing its primary revenue source. If PlayUp slides into insolvency before receiving its deferred payments, CrossBet could find itself in a situation where it’s left holding the bag for unpaid liabilities.

Despite its problems and mounting debt, PlayUp’s Australian operations still generate roughly AUD 40 million in annual revenue, a figure that highlights just how far the asking price has fallen from what the company could once have commanded. The sale represents merely a fraction of what the company might have been worth just a few years earlier, even accounting for the troublesome litigation and regulatory issues that have accumulated. This massive gap between potential value and actual sale price reflects just how damaged the PlayUp brand has become and how limited the market for its assets truly is.

Key Shareholders Ready to Sell

For the deal to close, PlayUp needs shareholder approval, but that approval appears likely. CEO Daniel Simic and shareholder Richard Sapford, who together control nearly half the company, are expected to support the sale to CrossBet. This backing makes the transaction probable, even if some minority shareholders might harbor doubts about accepting such a reduced valuation. Sapford and Simic’s support essentially gives the deal a green light, assuming they can maintain control of voting coalitions.

CrossBet’s Larger Strategic Ambitions

The surprising twist in this story is what the deal means for CrossBet and its parent organization. The Brisbane-based bookmaker, which launched in 2020 and has built a strong reputation for specializing in horse racing, greyhounds, and harness racing betting markets, isn’t simply acquiring a troubled operator to pick up some additional revenue streams. Instead, the acquisition appears to be part of something much bigger and more ambitious.

In September 2025, a new entity called NextBet officially launched in Australia as an acquisition vehicle, and CrossBet was its first major acquisition. NextBet is itself an acquisition vehicle formed by BetMakers Technology Group, a publicly listed Australian company that provides technology platforms and retail wagering services to both wholesale and retail market segments. NextBet’s strategy is brazenly ambitious: it intends to roll up undercapitalized lower-tier operators and build a powerful mid-tier competitor capable of standing toe-to-toe with the market’s larger, better-capitalized players.

Scott Cross, who founded CrossBet and now serves as NextBet’s Executive Director, has been remarkably transparent about this consolidation strategy and his philosophy regarding industry dynamics. Speaking to media outlets, Cross explained that organic customer acquisition in the betting industry is extremely difficult and expensive, particularly in a market saturated with competitors and constrained by strict advertising regulations. He argued that the company must pursue multiple angles simultaneously, including targeted acquisitions. In CrossBet’s own case, the company experienced turnover declines of as much as 30 percent from peak levels since its 2020 launch, a figure that far exceeds the industry’s broader 10 percent decline. Cross believes the time is precisely right for consolidation before smaller operators become completely unviable.

A Fragmented Industry Rapidly Reshaping Itself

The PlayUp-CrossBet deal sits within a larger context of consolidation and profound reordering in Australian wagering. The industry has historically been fragmented, with various mid-tier and smaller operators competing alongside major players like PointsBet Holdings. PointsBet, listed on the Australian Securities Exchange, has emerged as one of the stronger performers despite significant challenges. For the financial year ending June 2025, PointsBet reported revenue of AUD 261.4 million, representing 6 percent year-over-year growth and the highest figure in the company’s history. Notably, for the first time in its history, PointsBet achieved positive normalised EBITDA, hitting AUD 11.2 million in the most recent fiscal year. The company also boasts a rolling annual cash active player base of nearly 296,000, indicating sustained consumer demand for its product.

Yet even PointsBet, as the strongest performer in the mid-tier space, isn’t immune to industry pressures and acquisition interest. The company faces a takeover battle as multiple parties vie for control. Japanese conglomerate MIXI has bid AUD 1.25 per share, rising to AUD 1.30 if it secures more than 90 percent ownership. Rival Betr Entertainment has countered with AUD 1.40 per share in an all-share arrangement, arguing its proposal offers superior value and faster growth prospects. This indicates that even successful operators are attracting acquisition interest as consolidation sweeps through the market.

The Regulatory Pressure Fueling Industry Consolidation

Why is consolidation accelerating so rapidly? Much of it flows from increasingly stringent regulation and relentlessly rising compliance costs that reshape the competitive landscape. Australia’s gambling sector is undergoing unprecedented regulatory tightening, with the Australian Communications and Media Authority expanding its enforcement powers significantly in 2025. The ACMA has been particularly aggressive in enforcing self-exclusion requirements under the Interactive Gambling Act. State licensing structures remain fragmented, with each jurisdiction imposing its own rules and standards. Marketing restrictions, self-exclusion requirements, credit card bans, and targeted intervention programs all add cost and complexity to operations, while regulatory measures are also tightening on online cryptocurrency gaming platforms.

For larger operators like PointsBet or emerging consolidators like NextBet, these compliance costs are manageable because they’re spread across a bigger revenue base and across multiple market segments. For smaller, undercapitalized operators, the burden becomes increasingly unsustainable. Rising competition from better-capitalized rivals only makes the situation worse. This is precisely why Scott Cross sees consolidation as the strategic answer, and why PlayUp’s Australian assets, despite their legal baggage and regulatory issues, still hold value for an operator pursuing a roll-up strategy.

A Warning for the Sector

The larger lesson from PlayUp’s decline is one that may concern other mid-tier operators throughout the region. The company started with genuine competitive advantages, including proprietary technology and an innovative integrated product offering. Yet it couldn’t navigate the combination of regulatory pressure, failed strategic transactions, internal conflicts, and compliance mishaps. Today’s Australian wagering market rewards scale, strong governance, technological sophistication, and disciplined execution. For operators lacking those qualities or the capital to build them, acquisition by a larger player increasingly appears inevitable.

The December 10 shareholder vote will determine whether PlayUp’s Australian business finds new life under NextBet’s consolidation umbrella or continues as an independent but struggling operator. Based on support from major shareholders and the limited options available, the vote seems likely to pass. When it does, another mid-tier player will have joined the consolidation wave, reshaping Australia’s increasingly stratified gambling landscape where scale, compliance excellence, and operational discipline are the primary determinants of survival.