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The Stars Group: How a Gaming Tech Company Bought the World's Biggest Online Poker Empire
I. Introduction & Episode Roadmap
Picture this: It's August 1, 2014, and somewhere in Montreal, a 33-year-old entrepreneur named David Baazov is about to close the most audacious deal in online gaming history. His company, Amaya Gaming, has revenues of around $36 million and a market cap that barely registers on the radar of serious institutional investors. And yet, through sheer force of will, financial engineering, and perhaps a touch of what some might later call recklessness, he's about to acquire the world's largest online poker company for $4.9 billion—more than a hundred times his company's annual revenue.
Amaya, a Canadian manufacturer of betting equipment and software, announced it would pay $4.9 billion in cash to acquire Rational Group, which owned the online gambling brands PokerStars and Full Tilt Poker. The company led by David Baazov borrowed $3 billion for the deal.
This isn't just a story about online gambling. It's a story about the intersection of regulation and entrepreneurship, about M&A as a competitive weapon, about the gray zones that exist when technology outruns the law. It's about what happens when a founder is forced out, when a scandal nearly destroys everything, and when a company that shouldn't have won managed to become—briefly—the most valuable publicly traded online gambling company in the world.
The sale of The Stars Group to Flutter was completed on May 5, 2020—a transaction that valued the combined enterprise at more than £11 billion and brought together an unprecedented portfolio of gaming brands. But the journey there winds through some of the most dramatic terrain in gaming history: the founding of PokerStars from a Canadian basement, the "Moneymaker Effect" that ignited a global poker boom, the infamous Black Friday when the Department of Justice shut down online poker in America, and the insider trading scandal that toppled a founder-CEO.
The key inflection points read like a thriller: a father-son founding team building software that would revolutionize an industry; an amateur accountant from Tennessee turning an $86 satellite entry into $2.5 million and changing poker forever; a shutdown that froze hundreds of millions in player funds; a Ponzi scheme that destroyed a major competitor; and the scramble to pick up the pieces. Along the way, we'll meet some genuinely fascinating characters—including an Israeli-Canadian mathematician who stayed one step ahead of U.S. law enforcement for nearly a decade, and a high school dropout who went from sleeping in Montreal parks to running the world's largest online gambling company.
II. Prelude: The Online Poker Origin Story (2001-2003)
The Scheinbergs: Father-Son Founders
The origin story of PokerStars begins not in a Silicon Valley garage, but in a Toronto suburb, where a brilliant but quiet mathematician named Isai Scheinberg was contemplating his next move.
Isai Scheinberg (born 1946 or 1947) is the Lithuanian Jewish founder of the PokerStars online poker site. Scheinberg previously had been a senior programmer for IBM Canada. His journey to Toronto had been circuitous. Despite growing up in modest conditions, he stood out academically and earned a scholarship to study mathematics at Moscow State University. He emigrated from the Soviet Union to Israel in 1971, where he worked as a programmer at IBM before relocating to Canada in 1987.
Isai wasn't just a programmer—he was a poker player. "I was a recreational poker player since my days in university, and it led to my view that players of all abilities should be equally respected," he later recalled. "Poker players are the company customers – and customers should always come first."
By the late 1990s, Scheinberg had been watching the early pioneers of online gambling and concluded he could build something better. Towards the end of the 1990s, Scheinberg began developing his idea for a poker site. It was around this time that internet-based gambling was starting to take off and Scheinberg thought he could create something better than all other early poker sites. He began to assemble a team of programmers, some that he had worked with at IBM and tried to recruit people that were knowledgeable about poker.
What made Scheinberg different from other early online gambling entrepreneurs was his obsessive attention to product quality. At some point in 2000, he sent an email to Terrence Chan who was at the time a student. Scheinberg had found him through an online discussion group, rec.gambling.poker, of which he was a keen reader. Impressed with the poker knowledge Chan showed, Scheinberg asked him to serve as a consultant. Chan got involved and helped the programmers to develop the poker software.
Isai explains: "I spent decades in software development and succeeded in hiring a small team of truly outstanding programmers. We created the site with many innovations in one year and then kept pace through the years ahead." The programmers worked for Isai at a company he formed in Canada called Pyr Software, so named because of his love for Pyrenees dogs.
His son Mark, born in 1973 in Israel and raised partly in Canada, became his partner in the venture. Mark had dropped out of Fanshawe College after one year to pursue work in hospitality and travel across Asia and South America. In 2001, at age 28, he co-founded PokerStars with his father. The arrangement was elegant: Isai led software development from Toronto, while Mark ran gaming operations from Costa Rica, where regulatory oversight for online gambling was minimal.
The Launch and Early Operations
PokerStars launched its beta version for play-money games on September 11, 2001—a date that would be remembered for very different reasons, but one that marked the quiet beginning of what would become a global gambling phenomenon.
From the start, PokerStars distinguished itself with superior technology. "PokerStars was the leader in full-functioned multi-table tournaments from day one, which players loved," Isai later said. This wasn't just marketing speak—the technical capability to run large-scale multi-table tournaments simultaneously was genuinely revolutionary. Competitors like PartyPoker and Paradise Poker offered basic cash games, but PokerStars was building infrastructure for something bigger.
PokerStars specialised initially in online poker tournaments. In 2002, it launched the World Championship of Online Poker with a flagship $1,050 main event. It might seem small fry now, but back then, it was revolutionary.
The customer obsession extended beyond the software. With customers signing up in ever-increasing numbers, Isai was keen to develop the PokerStars support team to offer the most informed, helpful, and fastest responses in multiple languages. "I felt that having intelligent and diligent people in support was fundamental to company success. We wanted questions answered quickly and honestly and provided tools from the early days to help to do this." The support operation began initially in Costa Rica, but soon employed a "follow the sun" 24/7 support strategy and operations were placed worldwide to cope with language and time zone demands.
But the moment that would transform PokerStars—and online poker itself—came from an unlikely source: a 27-year-old accountant from Tennessee named Chris Moneymaker.
The Moneymaker Effect (2003): The Inflection Point
Sometimes a single event can reshape an entire industry. For online poker, that event occurred in May 2003 at Binion's Horseshoe Casino in Las Vegas.
Christopher Bryan Moneymaker (born November 21, 1975) is an American poker player who won the Main Event at the 2003 World Series of Poker (WSOP). His 2003 win is said to have revolutionized poker because he was the first person to become a world champion after qualifying at an online poker site. This has been referred to in the press as the "Moneymaker effect".
The backstory is almost too perfect. Moneymaker was working as an accountant when he won a seat in the Main Event of the 2003 World Series of Poker through an $86 satellite tournament. Moneymaker qualified for the 2003 WSOP main event through an $86 satellite on PokerStars. The amateur parlayed that into a $2.5 million score after defeating 839 players and besting poker pro Sammy Farha heads-up.
There's a delicious irony to the story. First, he thought he was playing a sit-n-go on PokerStars that offered a cash prize, only to discover after he'd won that he'd instead earned a $650 WSOP main event satellite seat. And when he made it to the final stages of that second satellite, he actually tried to lose. "With four players left, three players would win main event seats, but the fourth would take home about $8,000, which was coincidentally about my credit card bill at the time," Moneymaker recalled. "So, I was actually trying to 'lose' and be responsible, so I could win the money. But a friend called me, talked me out of it and said that he would give me $5,000 for half of my action. So I decided to win my seat."
The rest is history. Moneymaker arrived in Las Vegas with borrowed money and no live tournament experience. He played his way through a field of 838 players, including seasoned professionals, and took home $2.5 million. ESPN broadcast the final table, complete with hole-card cameras that let viewers see each player's hidden cards—making the drama comprehensible to casual viewers for the first time.
The term was created after Chris Moneymaker, a 27-year-old accountant and amateur poker player from Tennessee, United States, outlasted 838 other players to win the 2003 World Series of Poker (WSOP) Main Event, thereby winning the US$2.5 million prize and the title of World Champion. He became the new poster boy for poker, inspiring potential players to believe that "staying at home in front of a computer screen could be more profitable than going to work." His improbable win also started a new era in poker in which "a nobody could topple the feared pros."
The impact was immediate and staggering. In the years that followed Moneymaker's win in the Main Event, the WSOP and poker tournaments around the world saw historic turnouts, with online poker dramatically rising in popularity as well. This period is referred to by many as the Poker Boom, with Moneymaker's inspiring win in the 2003 Main Event deemed as the catalyst.
When Chris Moneymaker, an Internet qualifier, won the World Series of Poker in 2003, the event was attended by 839 players. By 2006 attendance had increased to 8,773 players and online poker had become huge business. Amateur players began to hone their skills by playing dozens of games a day and an unprecedented amount of people were able to make a living off of online games alone.
For PokerStars, the Moneymaker Effect was rocket fuel. They had built the infrastructure for exactly this moment—the satellites, the tournaments, the reliable software. Now millions of aspiring players were flooding online, dreaming of their own Moneymaker moment. And PokerStars was there to catch them.
III. The Golden Age & UIGEA (2003-2010)
Explosive Growth
The years following Moneymaker's victory represent the golden age of online poker—a period of exponential growth, cultural penetration, and increasingly uncomfortable questions about legality.
Revenue from poker operations in Nevada, the epicenter of U.S. live poker, nearly tripled between 2003 and 2006, as casinos added tables and rakes from expanded cash games and tournaments fueled industry-wide gains. This surge aligned with a national trend where poker room revenues in major markets like Las Vegas and Atlantic City escalated, with estimates indicating U.S. commercial casino poker win exceeding $1 billion annually by mid-decade.
Online platforms amplified overall sector revenue, with global gross revenues from internet poker climbing from under $500 million in 2003 to $2.4 billion by 2005, per industry analyst estimates, as sites like PartyPoker and PokerStars hosted millions of hands daily and sponsored live events to cross-pollinate player bases.
PokerStars emerged as the dominant platform in this landscape. The site's technical superiority—its ability to run massive tournaments smoothly, its customer service, its game integrity measures—created genuine network effects. The more players who joined, the more valuable the platform became.
The economics were remarkable. Online poker sites make money by taking a "rake"—a small percentage of each pot in cash games, or a fee for tournament entry. With millions of hands being dealt every day, even a modest rake added up to enormous revenues. And unlike physical casinos, the marginal cost of adding another virtual seat was essentially zero.
The symbiotic relationship between online and live poker reached its peak during this period. Online sites sponsored the major live tournaments, which generated TV coverage, which drove more players online. The companies combined for an estimated US$200 million in advertising and marketing in the United States. On cable television, ESPN's contract with PokerStars was for $22 million.
Yet even during this period of explosive growth, the legal foundations were shaky. Online poker operated in a gray zone—not explicitly legal, but not clearly illegal either. The primary federal statutes that could apply, like the Wire Act of 1961, had been written for an era of telephone bookies and didn't obviously cover internet poker.
The UIGEA Shock (October 2006)
The comfortable ambiguity of online poker's legal status came to an abrupt end in October 2006, though the manner of its ending was almost comically legislative.
On October 13, 2006, the United States enacted the Unlawful Internet Gambling Enforcement Act ("UIGEA"), making it a federal crime for gambling businesses to "knowingly accept" most forms of payment "in connection with the participation of another person in unlawful Internet gambling."
The passage of UIGEA was, in retrospect, a legislative accident. The bill was attached to the SAFE Port Act, an unrelated piece of legislation about port security, in the final hours before Congress adjourned for recess. It passed at nearly midnight with minimal debate.
The impact was immediate and dramatic—but it split the industry in two.
With the enactment of UIGEA, leading internet gambling businesses – including the leading internet poker company doing business in the United States at that time – terminated their United States operations. However, PokerStars, along with Full Tilt Poker and Absolute Poker, continued illegally to make internet poker available to U.S. players.
PartyPoker, which at the time was the largest online poker site serving U.S. players, withdrew from the American market immediately. This created an enormous competitive opening. PokerStars and Full Tilt Poker, based offshore and less concerned about U.S. regulatory pressure, rushed in to capture the abandoned market share.
The decision to stay in the U.S. market was both a massive commercial opportunity and a massive legal risk. Whereas some sites, like Party Poker, fled the U.S. market, those who risked breaking the law due to inadequate UIGEA enforcement were able to earn billions of dollars in revenue during the five years before the DOJ shut them down.
For the next five years, PokerStars, Full Tilt, and Absolute Poker operated in an increasingly elaborate cat-and-mouse game with U.S. financial institutions. Since banks and credit card companies wouldn't process gambling transactions, the sites worked with payment processors who disguised the payments as something else.
Because U.S. banks and credit card issuers were largely unwilling to process payments for illegal Internet gambling, the poker companies allegedly used fraudulent methods to circumvent federal law and deceive these financial institutions into processing payments on their behalf. For example, the poker companies arranged for the money received from U.S. gamblers to be disguised as payments to hundreds of non-existent online merchants purporting to sell merchandise such as jewelry and golf balls.
This arrangement was profitable but precarious. And eventually, the house of cards would collapse.
IV. Black Friday: The Day Everything Changed (April 15, 2011)
The Indictment
April 15, 2011 began like any other Friday for millions of online poker players. They logged into their accounts, planning to grind out another session of Texas Hold'em. What they found instead was a message from the FBI.
On that day — April 15, 2011 — the U.S. Department of Justice unsealed a 52-page indictment against top executives of PokerStars, Full Tilt Poker, and Absolute Poker, as well as a civil complaint against those companies. This Friday marks the fifth anniversary of the most memorable Friday in many poker players' memories — Black Friday, or the day everything changed as far as online poker in the United States is concerned.
United States v. Scheinberg is a United States federal criminal case against the founders of the three largest online poker companies, PokerStars, Full Tilt Poker and Cereus (Absolute Poker/Ultimatebet), and a handful of their associates, which alleges that the defendants violated the Unlawful Internet Gambling Enforcement Act (UIGEA) and engaged in bank fraud and money laundering to process transfers to and from their customers.
The scope of the government's action was staggering. Over 70 bank accounts in 14 countries were frozen, preventing players from accessing balances held by the companies. In total, 11 individuals were charged, including PokerStars founder Isai Scheinberg, CEO of the Full Tilt software company Tiltware Ray Bitar, and Absolute Poker owner Scott Tom.
Those named in the indictment faced years in prison while the civil complaint sought $3 billion in assets from the sites.
The immediate aftermath was chaos. PokerStars and Full Tilt Poker immediately withdrew from the US market as did Absolute Poker/UltimateBet a short time later. Players were left in limbo, unable to logon and unsure if their deposits were safe and would be returned.
The companies accounted for a large proportion of World Series of Poker qualifiers via online satellites. As a result, the 2011 World Series of Poker main event had the highest percentage of foreign players (and lowest percentage of American players) in history with 2,265 foreign players.
The advertising money that had fueled poker's TV presence evaporated overnight. ESPN withdrew its Pokerstars advertising. On April 17, ESPN2 cancelled its scheduled broadcast of the 2011 North American Poker Tour presented by PokerStars.net.
U.S. citizens who play online poker for a living effectively lost their livelihoods due to the DOJ action.
Full Tilt's Collapse & PokerStars' Redemption
The immediate crisis of Black Friday revealed a deeper and more disturbing problem at Full Tilt Poker—one that would define the aftermath and ultimately reshape the entire industry.
The biggest shock, however, came after the FBI intervention. It was revealed that Full Tilt Poker was not actually keeping player deposits in separate accounts as it had claimed, but was using them to pay managers and professional players. The scheme turned out to be a typical Ponzi scheme - new players' money was being used to pay off older players and employees. According to the federal indictment, Full Tilt Poker owed players more than $390 million when it actually had only $60 million deposited in its accounts.
The revelation was stunning. Full Tilt had been one of the most respected names in online poker, endorsed by legends like Phil Ivey, Howard Lederer, and Chris "Jesus" Ferguson. Now it was revealed as something approaching a fraud.
In the amended complaint the government alleged that "Full Tilt Poker did not maintain funds sufficient to repay all players, and in addition, the company used player funds to pay board members and other owners more than $440 million since April 2007."
"In effect, Full Tilt Poker operated what was, by then, nothing more than a Ponzi scheme. When the scheme finally collapsed, Full Tilt Poker was unable to pay players the approximately $350 million it owed them."
Against this backdrop of scandal and institutional failure, PokerStars emerged as the hero. The company had kept player funds segregated and properly managed. Within days of Black Friday, it began processing withdrawals for U.S. players.
PokerStars, on the other hand, began the process of making its players whole less than 10 days after the DOJ shut down its US operations.
The contrast between PokerStars and Full Tilt couldn't have been starker—and it created an opportunity for PokerStars to emerge from Black Friday even stronger than before.
The Legal Aftermath
The settlement negotiations that followed Black Friday were complex, involving criminal and civil proceedings, multiple jurisdictions, and billions of dollars. But the outcome was remarkable.
According to court documents, under the terms of the settlement with Full Tilt Poker, the company agreed to forfeit virtually all of its assets to the U.S. to fully resolve the charges in the complaint. Under the terms of the settlement with PokerStars, the company agreed to forfeit $547 million to the U.S. and to reimburse the approximately $184 million owed by Full Tilt Poker to foreign players, in order to fully resolve the allegations in the complaint. The settlement further provides that PokerStars will acquire the forfeited Full Tilt Poker assets from the government.
On July 31, 2012, the US government dismissed "with prejudice" all civil complaints against all PokerStars and Full Tilt Poker companies after coming to a settlement with PokerStars which includes PokerStars purchasing Full Tilt. PokerStars and Full Tilt admitted no wrongdoing as part of the settlement.
The total settlement—$731 million dollars, which includes a forfeiture to the United State Government and funds to reimburse customers of Full Tilt Poker—was unprecedented. But for PokerStars, it was also strategic.
By paying for Full Tilt's debts and making players whole, PokerStars accomplished several things: it burnished its reputation as the trustworthy operator in a tarnished industry; it eliminated its main competitor by acquiring its assets; and it positioned itself for eventual re-entry into the U.S. market when legalization came.
PokerStars had always stood out for its relentless focus on taking care of the players. That proved true even - perhaps especially - following the sudden closing of the American online poker market, which left millions of players uncertain about their online bankrolls sitting with the poker sites. "I am especially proud that after Black Friday we immediately made whole PokerStars US players, and then, were able to do the same for Full Tilt's US and international players."
For Isai Scheinberg personally, however, Black Friday meant years of legal limbo. Though PokerStars resolved its civil liabilities, his criminal indictment remained outstanding. Despite the fact that PokerStars settled the civil suit against it with the DoJ, forcing the departure of Isai Scheinberg from the company, this deal did not clear him of any criminal charges. Scheinberg was not located in the country at the time and could not be arrested by U.S. law enforcement. He wisely chose to remain away from the United States for almost a decade, making him the sole remaining Black Friday defendant to not appear in court.
He would eventually surrender to U.S. authorities in January 2020. In September 2020, Scheinberg was sentenced to pay a fine of $30,000 with no jail time. The judge presiding over the case acknowledged the wrongdoings but also recognized the positive actions taken by PokerStars under Scheinberg's leadership.
V. Enter David Baazov: The Amaya Acquisition (2004-2014)
Amaya's Origins
While PokerStars was navigating Black Friday and its aftermath, a very different company was quietly building the war chest that would eventually buy the poker empire.
David Baazov is a Canadian entrepreneur and businessman who is best known for being the founder and former CEO of Amaya Inc. (now The Stars Group). He was born on December 31st, 1980, in Israel and grew up in Montreal, Canada.
Baazov's origin story reads like something from a business school case study—if that case study were titled "High Risk, High Reward." David dropped out of school when he was 16. The reason, you ask? He was bored. His conservative parents responded with kicking him out in the cold, yet he remained undeterred in pursuing his vision, even if it was somewhat unclear at the time.
The young Baazov scraped by, eventually building a computer reselling company that he grew to $20 million in value. At the age of 25, David Baazov sold his computer-reselling business and developed an electronic poker table, which became the beginning of Amaya Inc. He served as the CEO of Amaya Inc., which went public on the Toronto Venture Exchange in 2010 with a revenue of $6 million.
In 2005, Baazov founded what would become Amaya software. He started working with some gambling experts to develop software that could be embedded into a poker table; the theory being that a casino could buy this table and have it in their facility without a dealer necessary. This would allow the hands to play much faster, almost as fast as their online counterpart. In turn, this would make the casino more money in rake and Baazov more money in commission. The tables, while not a huge hit initially, did start to generate some income for Amaya.
Baazov's strategy was to build Amaya through acquisitions of smaller gaming technology companies. Amaya Inc. began acquiring online gambling firms and developers such as Cadillac Jack, CryptoLogic and Chartwell Technology, as the company changed its focus to online gaming.
In 2012 David parlayed that into the purchase of slot machine maker Cadillac Jack for $177 million, with much of that being raised in debt from Blackstone.
But Baazov had his eyes on a much bigger prize.
The Audacious Bet: Acquiring PokerStars
The PokerStars acquisition stands as one of the most audacious leveraged buyouts in gaming history—perhaps in any industry. That isn't how Baazov operates, and he then decided to turn his attention to the biggest prize of all in the online gambling world – the hugely successful PokerStars. Now, this seemed outlandish on many fronts; the poker site had just paid a massive fine to the Department of Justice to settle the issues stemming from operating post-UIGEA. Also, the company was doing incredibly well from a profitability standpoint, reaching the billion-dollar revenue mark.
Initially, however, his approaches were swiftly turned down – for two reasons. First of all, Isai Scheinberg wasn't looking to sell; secondly, Amaya did not have the kind of capital required for this type of transaction – not even close.
The go ahead finally came in the summer of 2013. The Scheinbergs, who were perhaps tired of Baazov's constant haunting, told him that if he could get them a commitment of $3 billion from a financial firm, they were ready to negotiate. It was music to his ears.
Finally, he got that break when in 2013, PokerStars had their New Jersey gaming application denied due to the Scheinbergs' continued relationship with the firm. That was the catalyst Baazov needed, and in early 2014 a deal was reached whereby Amaya would acquire PokerStars for a staggering 4.9 Billion dollars.
The deal structure was breathtaking in its leverage. The financing included: a $1.75 billion seven-year first lien term loan priced at Libor plus 4.00%, and a €200 million seven-year first lien term loan priced at Euribor plus 4.25%; an $800 million eight-year second lien term loan priced at Libor plus 7.00%; approximately $213 million from cash on hand, which includes the $50 million deposit made on June 12, 2014.
It was easily the biggest loan issued against online gambling assets, but the numbers that the Rational Group were able to present simply made it too appealing – even for the banks.
On August 1st, just two days before his 34th birthday, the sale was completed and a once penny-stock public company was turned into a huge gaming corporation ready to take over the market.
The acquisition would create the world's largest publicly-held online gambling company and news of the deal sent Amaya's stock prices soaring, as the Canadian company's shares were up more than 40% Friday afternoon.
Scheinberg's Exit & Legacy
For the Scheinberg family, the sale represented both an exit and a vindication.
Mark Scheinberg, as the founder, CEO, and largest shareholder of the Oldford Group, played a central role in the negotiations, leading the shareholder group in disposing of their interests to facilitate the transaction.
"I am confident that Amaya, together with Rational Group's leadership, will continue to successfully grow the business into the future," said the Rational Group founder and CEO Mark Scheinberg. "While myself and other founders are departing, we are happy to see the business and the brands we have developed, along with the teams behind them, transferred to strong new ownership."
The financial outcome was extraordinary. Forbes estimates Scheinberg's net worth at $6 billion as of 2025, placing him at #581 on their annual Billionaires list.
Scheinberg started Mohari Hospitality as an investment firm focused on the luxury and hospitality sectors. The firm has investments in the Peninsula Resort in Papagayo, Costa Rica, the Ritz-Carlton Yacht Collection, the Waldorf Astoria Miami, and the Four Seasons Private Residences in Washington, DC. Mohari has hired former Chief Executive Officer of Four Seasons Hotels & Resorts, J. Allen Smith as Managing Partner.
But the Scheinbergs' most enduring legacy isn't financial—it's the culture they built. Isai has said: "I am incredibly proud of the team we had at Stars, with very smart and hardworking people who made the company what it became. I think people respected the culture where the only criteria for the decisions were to do the right thing – for customers, employees, and partners, and to be 100% transparent no matter how hard it could be."
VI. The Baazov Era: Scandal & Transition (2014-2018)
Early Signs of Trouble
The Amaya-PokerStars deal was barely complete before troubling questions emerged about how it came together.
Amaya's stock, which is traded in Toronto under the symbol 'AYA', increased in value by 50% in the days leading up to the transaction, prompting an investigation by Canadian authorities. One day after the acquisition was announced, Amaya's stock went up another 30%.
In December 2014, Canadian officials showed up at Amaya's headquarters in Montreal searching for information related to the company's acquisition of the Rational Group. In subsequent days, Amaya's stock price tumbled 20%.
The Securities Fraud Charges
In March 2016, the other shoe dropped.
Shares in Canada's Amaya Gaming plunged by more than one-fifth on Wednesday morning after securities regulators charged CEO David Baazov (pictured) with insider trading. Early Wednesday, Autorité des marchés financiers (AMF), the stock watchdog in Amaya's home province of Quebec, filed a total of 23 charges against Baazov, Amaya staffer Benjamin Ahdoot and Yoel Altman, a close friend of Baazov who formerly served as a financial advisor to the firm.
Baazov's charges include aiding with trades while in possession of privileged information, influencing or attempting to influence Amaya's market price and communicating privileged information.
According to Quebec securities regulator Autorité des Marchés Financiers (AMF), Baazov used his position as CEO of the company to inform close associates, including brother Josh Baazov, of private, privileged information.
David Baazov was Amaya's CEO at that time. In March 2016, following charges by Canadian regulators with multiple securities fraud charges, he took an indefinite leave of absence, and resigned in August.
The Stay of Proceedings
What happened next was almost as dramatic as the charges themselves. The prosecution's case collapsed—not on the merits, but on procedural grounds.
In a stunning rebuke of Quebec's securities regulator, the AMF, a Quebec court judge ordered Wednesday all charges of insider trading against former online gambling mogul David Baazov and his co-accused be stayed.
The decision was made in response to the defence's claim it was inadvertently given about 320,000 privileged documents it shouldn't have seen.
Quebec's securities regulator, the AMF, accidentally shared more than 300,000 documents that were supposed to remain confidential with the defence. The AMF is now asking the defence to return the documents and pretend it never saw them. Baazov's lawyer, Sophie Melchers, told Quebec court Judge Salvatore Mascia that demand was "nonsense".
On June 6, 2018, the Court of Quebec ordered a Stay of the Proceedings brought by the Autorité des Marchés Financiers (Canada) against David Baazov. The Supreme Court of Canada states that a stay of proceedings is the "ultimate remedy," which prevents the court from ever adjudicating the matter. A Stay of Proceedings under Canadian law is the equivalent to a dismissal with prejudice under U.S. law.
New Leadership
With Baazov's departure, the company needed new leadership. It found it in Rafi Ashkenazi, a gaming industry veteran who had been working at the company.
Current CEO Rafi Ashkenazi became Interim Chief Executive Officer of The Stars Group, then Amaya, in March 2016 and then permanent chief executive officer in November, 2016. On August 1, 2017, the company changed its name to The Stars Group Inc.
Rafi Ashkenazi has been named chief executive officer of the Rational Group, Amaya Inc.'s online gaming division which includes the PokerStars and Full Tilt brands. Ashkenazi is an experienced gaming industry executive and joined the Rational Group in January 2013 as Chief Operating Officer, responsible for all customer-facing product and back-office functions for PokerStars and Full Tilt including marketing, customer support, poker room management, IT management, payment processing & security, and game integrity. Prior to joining the Rational Group, Ashkenazi was Chief Operating Officer of Playtech, a global gaming software company.
He was appointed senior vice president of strategy of The Stars Group in April 2015 and made interim chief executive officer in March 2016 before that role was made permanent in November of that year, with responsibility for devising and implementing its business plan and strategies including gaming's leading brand PokerStars. Ashkenazi took over the reins of the online gaming and betting company last year following David Baazov's departure amid insider trading charges. After a name change to better align with its mainstay PokerStars brand, and a management reshuffle, Ashkenazi is now looking for ways to expand the company previously known as Amaya.
Under Ashkenazi's leadership, The Stars Group would chart a very different course—one focused on diversification, regulatory compliance, and strategic acquisition.
VII. Transformation & The Pivot to Sports Betting (2018-2019)
The Sky Betting & Gaming Acquisition
Ashkenazi inherited a company that was profitable but dangerously dependent on a single product—online poker—in an industry where that product was mature and facing regulatory headwinds. His solution was bold: transform The Stars Group from a poker company into a diversified online gaming platform.
The Stars Group Inc. announced today that it has agreed to acquire Sky Betting & Gaming ("SBG") from CVC Capital Partners ("CVC") and Sky plc ("Sky") in a cash and stock transaction valued at $4.7 billion. This combination will result in the world's largest publicly listed online gaming company.
SBG is currently home to the United Kingdom's largest active online player base and, with over 80% of revenues generated from mobile devices, is a leading mobile betting and gaming operator. In partnership with Sky, Europe's leading sports broadcaster and media company, SBG has developed some of online gaming's most well-known brands, most notably Sky Bet, Sky Vegas and Sky Casino.
The financial profile of SBG was impressive. SBG's unaudited annual revenue was ÂŁ624 million and unaudited adjusted EBITDA was ÂŁ202 million in the 12-month period ended December 31, 2017, representing compounded annual growth rates of approximately 46% and 51%, respectively, over the prior two years. SBG was the United Kingdom's fastest growing established online gaming operator over this period.
"The acquisition of Sky Betting & Gaming is a landmark moment in The Stars Group's history," stated Rafi Ashkenazi, the Company's Chief Executive Officer. "SBG operates one of the world's fastest growing sportsbooks and is one of the United Kingdom's leading gaming providers. SBG's premier sports betting product is the ideal complement to our industry-leading poker platform. The ability to offer two low-cost acquisition channels of this magnitude provides The Stars Group with great growth potential."
The Fox Bet Partnership
With sports betting in the U.S. suddenly viable following the Supreme Court's 2018 decision striking down the federal ban, The Stars Group moved aggressively to establish a presence.
The Stars Group Inc. and FOX Sports, a unit of Fox Corporation, announced plans to launch FOX Bet, the first-of-its kind national media and sports wagering partnership in the United States. The Stars Group and FOX Sports have entered a long-term commercial agreement through which FOX Sports will provide The Stars Group with an exclusive license to use certain FOX Sports trademarks.
The Stars Group and FOX Sports expect to launch two products in the Fall of 2019 under the FOX Bet umbrella. One will be a nationwide free-to-play game, awarding cash prizes to players who correctly predict the outcome of sports games. The second product, which will be named FOX Bet, will give customers in states with regulated betting the opportunity to place real money wagers.
Fox Corporation acquired 4.99% of The Stars Group's issued and outstanding common shares for approximately $236 million. In addition, FOX Sports has the right to acquire up to a 50% equity stake in The Stars Group's U.S. business.
The deal represented a significant bet on the U.S. market—and on the integration of media and gambling, a combination that would become increasingly common in the years ahead.
Strategic Diversification
The transformation was substantial. The Stars Group's announced acquisitions since the beginning of 2018 will significantly diversify the Company's revenue base.
What had been a poker company was now something much broader: a global gaming platform with significant presence in sports betting, casino games, and daily fantasy sports. The question was whether this new, larger company could effectively integrate its acquisitions and compete in an increasingly crowded market.
VIII. The Flutter Merger: Endgame (2019-2020)
The Combination
The final chapter of The Stars Group's independent existence came on October 2, 2019.
On October 2, 2019, Flutter Entertainment announced an agreement to acquire The Stars Group for $6 billion.
Flutter Entertainment's shares spiked Thursday as the company announced its $12.2 billion merger with The Stars Group (TSG) would complete May 5, creating the biggest online gaming company in the world.
Under the terms of the Combination, shareholders in TSG received shares in Flutter, and Flutter shareholders now own 54.64% and TSG shareholders own 45.36% of the share capital in the combined group. The terms of the transaction value TSG at approximately ÂŁ4.95 billion, and the combined company at more than ÂŁ11.0 billion.
Regulatory Clearance
The CMA investigated and cleared the anticipated merger of Flutter Entertainment plc and The Stars Group Inc.
Last month, shareholders holding 99.2% of Flutter's share capital voted in favour of the merger, while TSG shareholders also backed the deal, with approximately 99.99% of votes cast in support of the proposed agreement.
The Combined Entity
Flutter Entertainment, the parent company of Paddy Power Betfair and FanDuel, has announced the completion of its acquisition of and merger with The Stars Group (TSG). The mega-merger, first agreed in October 2019, saw Flutter purchase all of the shares in TSG and join together with the operator to create a combined operation with annual revenue of ÂŁ3.8bn.
Paddy Power, Betfair, FanDuel, PokerStars and FoxBet will be under one roof.
TSG's business includes a number of major brands including Sky Betting and Gaming, PokerStars, Full Tilt, Fox Bet and BetEasy. All of these brands will form part of the combined business.
The timing was fortuitous—the merger closed on May 5, 2020, just as the COVID-19 pandemic was driving unprecedented traffic to online gaming platforms. Flutter, with its combined portfolio of brands and its presence in the explosive U.S. sports betting market through FanDuel, was positioned to capitalize.
IX. Playbook: Business & Investing Lessons
The Scheinberg Playbook
The story of The Stars Group offers several enduring business lessons.
Technology as Moat: Isai Scheinberg's approach offers a masterclass in technical excellence as competitive advantage. "I spent decades in software development and succeeded in hiring a small team of truly outstanding programmers. We created the site with many innovations in one year and then kept pace through the years ahead." In online gaming, where the product is fundamentally software, technical superiority translated directly into market dominance.
Customer Obsession as Strategy: "Poker players are the company customers – and customers should always come first." He famously spent hours trawling the Two Plus Two poker forum so that he could see first-hand what players were saying and thinking about the game. This wasn't just nice—it was strategic. When Black Friday hit, PokerStars' reputation for trustworthiness became its most valuable asset.
Regulatory Navigation: PokerStars operated for years in legal gray zones, accepting the risks while competitors fled. This gamble ultimately cost the Scheinbergs their company (they had to sell to resolve their legal situation), but it also made them billionaires. The lesson isn't that one should break laws, but that regulatory ambiguity creates both risks and opportunities that must be carefully evaluated.
The Baazov Playbook
David Baazov's story offers a different set of lessons—some positive, some cautionary.
Audacity Creates Opportunities: The PokerStars acquisition was, by any conventional measure, impossible. Amaya was too small, the target too valuable, the leverage required too extreme. But Baazov did it anyway. Sometimes the audacious bet pays off precisely because no one else is willing to make it.
The Dangers of Aggressive Growth: The same risk tolerance that enabled the PokerStars deal may have also led to the insider trading charges. Whether Baazov was guilty or innocent of those charges, the investigation and its aftermath destroyed his career and reputation.
Porter's Five Forces Analysis
Industry Rivalry: Online gambling is intensely competitive, with low switching costs for customers and constant pressure on pricing and promotions. The industry has seen significant consolidation (the Flutter-Stars merger being a prime example), but competition remains fierce.
Threat of New Entrants: Regulatory barriers create significant obstacles to entry, as does the need for technology infrastructure and customer trust. However, the U.S. market opening has brought substantial new entrants.
Bargaining Power of Buyers: Individual customers have low bargaining power, but they can easily switch platforms, creating de facto competitive pressure.
Bargaining Power of Suppliers: Key suppliers include payment processors (historically problematic in the U.S.), software developers, and increasingly, sports leagues providing data and legitimacy through partnerships.
Threat of Substitutes: Traditional casino gambling, illegal gambling, and social/free-to-play gaming all represent substitute threats.
Hamilton Helmer's 7 Powers Analysis
Network Effects: Online poker exhibits strong network effects—the more players on a platform, the more valuable it becomes to each player. This was PokerStars' fundamental moat during its growth phase.
Scale Economies: Software development costs are largely fixed, while marginal costs are minimal, creating powerful scale economies in online gaming.
Brand: PokerStars built exceptional brand equity through years of trustworthy operation and player-focused policies. This brand proved durable even through ownership changes.
Switching Costs: While individual players can easily switch platforms, accumulated loyalty points, established bankrolls, and familiar software create modest switching costs.
Key Performance Indicators
For investors tracking companies in this space, three metrics deserve particular attention:
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Active Players / Monthly Active Users: This is the fundamental measure of a gambling platform's health. Player acquisition costs and lifetime value derive from this metric.
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Revenue Per Active Player: This measures monetization effectiveness and product quality. Rising RPAP indicates successful cross-selling, product improvements, or pricing power.
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Market Share in Key Jurisdictions: Given the importance of regulatory access and network effects, market position in regulated markets is critical to track.
Myth vs. Reality
Myth: Online poker is purely gambling and success is random. Reality: Online poker involves significant skill components, and the best platforms succeeded through genuine technical and operational excellence, not just luck or aggressive marketing.
Myth: Black Friday destroyed online poker in America. Reality: While Black Friday ended the previous era of unregulated online poker, it also set the stage for the current era of state-by-state legalization. The industry is arguably larger and more legitimate today than before 2011.
Myth: David Baazov was convicted of insider trading. Reality: The charges against Baazov were stayed due to prosecutorial errors. He was never convicted or acquitted—the case was dismissed on procedural grounds.
Material Legal and Regulatory Overhangs
Flutter Entertainment, as the successor entity to The Stars Group, faces ongoing regulatory scrutiny across multiple jurisdictions. The UK Gambling Commission has increased oversight of all major operators, while the expanding U.S. market brings state-by-state regulatory complexity. Additionally, the industry faces ongoing debates about responsible gambling measures and advertising restrictions.
Conclusion
The story of The Stars Group is fundamentally a story about timing, technology, and transformation. A father-son team built the world's dominant poker platform through technical excellence and customer obsession. An accountant's improbable tournament victory sparked a global boom. A regulatory crackdown separated the trustworthy operators from the fraudulent ones. A young entrepreneur's audacious bet created the world's largest public online gambling company—before scandal derailed him. And finally, a merger created a global gaming giant positioned for the next era of the industry.
The brands that emerged from this history—PokerStars, Full Tilt, Sky Bet, FanDuel—now sit within Flutter Entertainment, one of the largest gambling companies in the world. The industry that Isai Scheinberg helped create from a Toronto basement has become a multi-billion dollar global phenomenon, increasingly integrated with mainstream sports media and operating under comprehensive regulatory frameworks.
For investors and business observers, the Stars Group saga offers enduring lessons about the power of technology as competitive advantage, the risks and rewards of operating in regulatory gray zones, the dangers of overleveraged acquisitions, and the ultimate importance of institutional trust. It's a story that could only have happened at the intersection of internet technology, financial engineering, and the ancient human appetite for games of chance and skill.
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X. Epilogue: The Legacy and What Comes Next
Flutter Entertainment's Trajectory
The entity that emerged from The Stars Group merger has continued its remarkable growth trajectory. Revenue for Q4 2024 was $3.79 billion, a 14% increase year-over-year. Net income for Q4 2024 was $156 million, compared to a net loss of $902 million in Q4 2023. In 2024 the company made a revenue of $14.04 billion USD, an increase over the revenue in the year 2023 that were of $11.79 billion USD.
Average monthly players increased by 7% year-over-year to 14.6 million in Q4 2024, and FanDuel extended its leadership in the US, becoming the number one operator for both sportsbook and iGaming.
The company has also embarked on an aggressive capital return program. The share repurchase program commenced in November 2024 with up to $5 billion expected to be returned to shareholders over the coming years. The first tranche of the program commenced in November 2024 with 444,746 shares repurchased in 2024 for $121 million. In 2025, Flutter expects to return approximately $1 billion to shareholders via the program.
Flutter's expansion continues through strategic acquisitions. The company announced acquisitions of NSX in Brazil and Snai in Italy, expected to complete in Q2 2025.
FanDuel's Dominance
The FanDuel brand that came through the Flutter merger—not the PokerStars acquisition—has emerged as the crown jewel of the combined portfolio. FanDuel is the top brand with a national market share around 40% all by itself. Over the course of 2024, FanDuel generated $5.78 billion in gross revenue (41% share) on $50.7 billion in total wagers (34%) from the 23 markets it serves.
At the brand level, it remains a two-horse race out front. FanDuel and DraftKings remain the overwhelming market leaders, together accounting for more than 65% of the industry's output nationwide.
Flutter reported record levels of customer engagement for the Super Bowl in 2025, where FanDuel had 3 million active customers placing 17.7 million bets with $470 million wagered on the day.
The Evolving Online Poker Landscape
While sports betting has become Flutter's primary growth engine, the online poker market that Isai Scheinberg pioneered continues to evolve. The global online poker market size was estimated at USD 3.86 billion in 2024 and is projected to reach USD 6.90 billion by 2030, growing at a CAGR of 10.2% from 2025 to 2030.
The online poker industry is experiencing significant growth through the integration of cross-platform interoperability, allowing users to seamlessly switch between devices without losing progress or access.
However, the competitive landscape has shifted dramatically. PokerStars once held an unassailable lead, but GGPoker has shattered that notion by overtaking the former giant with ease. While GGPoker's growth may slow as it nears market saturation, it is expected to remain the leader for a considerable period.
By May 2024, WPT Global had surpassed the still declining PokerStars in terms of active cash game players, solidifying its position as a strong contender in the competitive online poker market.
The industry continues to see technological evolution. Live dealer poker has emerged as a breakthrough format that successfully bridges the gap between traditional online poker and the authentic casino experience. Unlike conventional online poker with computer-generated gameplay, live dealer games feature real human dealers operating physical cards and tables, captured by high-definition cameras from multiple angles.
The U.S. Sports Betting Market
The U.S. market that PokerStars was forced to abandon in 2011 has become the most valuable prize in global gambling. The U.S. sports betting market size was estimated at USD 17.94 billion in 2024 and is expected to grow at a CAGR of 10.9% from 2025 to 2030. The growth is primarily driven by the legalization of online and mobile wagering across multiple states.
There is a clear hierarchy in the U.S. sports betting industry. The four sportsbooks that hold the most market share are FanDuel Sportsbook, DraftKings Sportsbook, BetMGM, and Caesars Sportsbook. Other operators, even ones with media giants like FOX and ESPN, have not managed to gain enough market share to disrupt the top sportsbooks.
The FOX Bet partnership that The Stars Group established has not achieved its original ambitions. Penn Entertainment was vying to hold a 20% market share in the sports betting industry with ESPN Bet by 2027. However, the current trajectory of ESPN BET shows that they are not on track to achieve that goal. As of April 2024, ESPN Bet held just under 6% market share in sports betting.
XI. Final Reflections
The Three Eras of Online Poker
The story of The Stars Group illuminates three distinct eras in online gambling history.
The first era, from 2001 to 2011, was the Wild West—a period of explosive growth, regulatory ambiguity, and enormous opportunity for those willing to operate in gray zones. PokerStars thrived in this environment precisely because of the Scheinbergs' willingness to accept regulatory risk while competitors fled.
The second era, from 2011 to 2018, was the recovery and consolidation phase. Black Friday devastated the U.S. market but created the conditions for PokerStars to eliminate competitors and emerge even stronger internationally. This era culminated in the Amaya acquisition, which brought the company under public market scrutiny and eventually led to its transformation.
The third era, beginning in 2018 and continuing today, is characterized by regulated markets, diversification beyond poker, and the integration of gambling with mainstream sports media. The Stars Group's acquisitions of Sky Betting & Gaming and the Fox Bet partnership exemplified this shift. The Flutter merger completed the transformation, creating a global platform positioned for the new regulatory environment.
What the Story Teaches
Several enduring lessons emerge from this two-decade saga.
First, technology creates moats—but only temporarily. PokerStars' technical superiority gave it an enormous advantage in the early 2000s, but that advantage eroded over time as competitors caught up and new entrants like GGPoker brought fresh innovation.
Second, regulatory strategy is a competitive weapon. The Scheinbergs' willingness to stay in the U.S. market after UIGEA was a calculated bet that paid off enormously, even though it eventually forced their exit from the company. Understanding regulatory risk and opportunity is essential in any industry where government plays a significant role.
Third, trust is the ultimate asset in financial services. When Black Friday revealed Full Tilt's fraud, PokerStars' reputation for integrity became its most valuable possession. Companies that prioritize customer trust, even at short-term cost, build durable competitive advantages.
Fourth, audacity and leverage can create extraordinary outcomes—but also extraordinary risks. David Baazov's acquisition of PokerStars was a triumph of financial engineering and entrepreneurial boldness. Whether the insider trading allegations that followed were connected to the same risk tolerance that enabled the deal remains an open question, but the pattern is instructive.
Fifth, industry evolution favors consolidation. The online gambling industry has steadily concentrated among a smaller number of larger players, with Flutter Entertainment now towering over the landscape. Scale advantages in technology, marketing, and regulatory compliance tend to compound over time.
The Scheinberg Legacy
Isai Scheinberg, the quiet mathematician who built PokerStars from a Toronto basement, ultimately achieved something remarkable: he created the dominant platform in a global industry, navigated years of legal jeopardy, made his family billionaires, and received minimal jail time after voluntarily surrendering to U.S. authorities.
His philosophy of putting customers first, hiring exceptional technical talent, and making decisions based on "doing the right thing" proved not just morally sound but commercially successful. In an industry often associated with exploitation and fraud, PokerStars under Scheinberg's leadership demonstrated that integrity could be a competitive advantage.
Mark Scheinberg, meanwhile, has parlayed his PokerStars fortune into a luxury hospitality empire, investing in properties like the Peninsula Resort in Papagayo, the Ritz-Carlton Yacht Collection, and the Waldorf Astoria Miami. His estimated net worth of over $5 billion places him among the wealthiest individuals to emerge from the gaming industry.
The Future of Flutter and Its Brands
Flutter Entertainment now operates as one of the world's largest gambling companies, with a portfolio of brands that includes Paddy Power, Betfair, FanDuel, PokerStars, Sky Betting & Gaming, and numerous regional operators. Flutter is the world's leading online sports betting and iGaming operator, with leading positions in markets across the world, including the US. Its ambition is to leverage its significant scale and its challenger mindset to change the industry for the better.
A key driver of success has been the Flutter Edge, its unique competitive advantage, which delivered innovative, market-leading product propositions to 35 million customers worldwide in 2024.
The company's guidance reflects continued optimism. Group revenue is projected to be between $15.48 billion and $16.38 billion in 2025. Group Adjusted EBITDA is expected to range from $2.94 billion to $3.38 billion.
Yet challenges remain. Regulatory pressures continue to intensify in key markets. The UK Gambling Commission has increased scrutiny of responsible gambling practices. U.S. state governments, seeing the revenue potential, are raising tax rates—New York has collected by far the most tax revenue from sports betting with its 51% tax rate on GGR, good for $1.21 billion for 12 months spanning July 2024 through June 2025.
Conclusion
The journey from Pyr Software's Toronto basement to Flutter Entertainment's global empire represents one of the most dramatic arcs in modern business history. It encompasses visionary founders, technological innovation, regulatory cat-and-mouse games, spectacular scandals, bold acquisitions, and ultimately, a transformation that saw a poker company become a diversified global gaming platform.
The brands that emerged from this history—PokerStars, Full Tilt, Sky Bet, FanDuel—now operate under common ownership, their fates intertwined within one of the world's largest gambling enterprises. The industry that Isai Scheinberg helped create from a love of mathematics and poker has become a multi-billion dollar global phenomenon, increasingly integrated with mainstream sports media and operating under comprehensive regulatory frameworks.
For observers of business strategy, the Stars Group saga offers a masterclass in technology-driven competitive advantage, regulatory navigation, leveraged acquisition, and industry consolidation. For students of entrepreneurship, it demonstrates both the extraordinary rewards and the substantial risks of operating at the frontier of regulated industries. And for anyone interested in the strange, fascinating world where technology, entertainment, and human nature intersect, it remains one of the most compelling stories of the digital age.
The next chapter belongs to Flutter Entertainment and its competitors as they navigate an industry that continues to evolve at remarkable speed. But the foundations laid by the Scheinbergs—the technology, the customer obsession, the willingness to accept calculated risks—remain embedded in the DNA of the enterprise they built. That legacy, perhaps more than any financial outcome, represents their enduring contribution to an industry they helped create.
XII. The Regulatory Chessboard: Global Market Dynamics
The European Landscape
The regulatory environment across Europe has grown increasingly complex since the Flutter merger, with each major jurisdiction implementing distinct frameworks that shape competitive dynamics. The United Kingdom remains the most significant regulatory environment for Flutter Entertainment's legacy operations. On April 6, 2025, the Gambling Levy Regulations 2025 came into force, introducing a statutory gambling levy payable by gambling operators to the UK Gambling Commission from October 1, 2025. The introduction of this new regulation marks a significant departure from the previous voluntary funding model for gambling-related harm prevention and treatment.
The Gambling Act 2005 (Operating Licence Conditions) (Amendment) Regulations 2025 introduced mandatory maximum stake limits for online slots games: from April 9, 2025, a ÂŁ5 per spin limit applies to players aged 25 and over, and from May 21, 2025, a ÂŁ2 per spin limit applies to players aged 18 to 24.
The UK Gambling Commission is overhauling its approach to penalties for those who break gambling rules and regulations, with a new system coming into effect in October 2025. The Commission has adopted a zero-tolerance stance, with CEO Andrew Rhodes noting: "There will be no warnings. We have undertaken nine suspensions in the last few weeks."
Flutter decided to move its primary listing from London to the New York Stock Exchange in May 2024, with approximately 98% of its shareholders voting in favor—driven in part by the fact that around 40% of its business takes place in the United States.
The Continental Patchwork
Across the European Union, the regulatory landscape remains fragmented but is slowly converging around common themes. A wave of new rules, rising taxes, and controversial legal battles is reshaping how and where Europeans gamble online, with the first half of 2025 bringing major regulatory shifts across Europe's leading iGaming markets.
Italy is introducing a new online gambling licensing and regulation regime. In December 2024, the Italian Customs and Monopolies Agency launched a concession program for online gambling that will initially last nine years, with each license costing €7 million—the highest licensing fee in the European Union.
Germany has implemented significant changes to gambling law in 2025. In February, the state parliament of Baden-WĂĽrttemberg allowed residents to play online blackjack and roulette through the state-owned Toto-Lotto GmbH, meaning online table games are now part of a state monopoly.
Regulatory cooperation has intensified, with representatives from Germany, France, Austria, the UK, Italy, Spain, and Portugal meeting in November 2025 to improve cross-border cooperation against illegal gambling, discussing customer exploitation and illegal advertising.
The European Gaming and Betting Association announced it would rewrite Anti-Money Laundering rules by 2026, aligning with EU crypto and compliance standards. As part of the EU's new AML legislative package, significant changes to Know Your Business obligations will come into effect by 2026, requiring gambling operators to prepare for substantial implications.
The Emerging Challenge of Cryptocurrency
A new regulatory frontier has emerged that the architects of PokerStars could scarcely have imagined. When UK Gambling Commission CEO Andrew Rhodes delivered his annual briefing, he focused on crypto gambling as a problem growing faster than anyone expected. Rhodes told operators that the rise of cryptocurrency use among younger consumers is one of the most significant changes facing the sector, noting: "What I thought was a five-year-away problem, perhaps a year or two ago, I think is now an 18-month to two-year challenge."
The Gambling Commission is not planning to license crypto operators independently. Instead, Rhodes called for a government-led discussion to determine whether digital assets should be recognized within the UK's regulatory system, emphasizing that "once you open that door, you cannot close it."
XIII. The Competitive Landscape in 2025
The U.S. Market: A Two-Horse RaceThe U.S. sports betting market that PokerStars was forced to abandon in 2011 has become the most valuable prize in global gambling—and it remains dominated by a clear duopoly.
According to Eilers & Krejcik Gaming, a boutique research and consulting firm, FanDuel and DraftKings make up the majority of the online sports betting and online casino industry. Combined, the two operators hold 67% market share.
DraftKings Sportsbook reclaimed the handle crown from FanDuel in May 2025, with the two continuing to jockey for position. DraftKings went back on top by 1.7 percentage points (36.6% to 34.9%), then in June 2025 extended the margin to a 4.8 point advantage, and further to 6.2% with the latest results as of November 2025.
Flutter's FanDuel and DraftKings command a combined 66.1% market share in the $117 billion US sports betting market. DraftKings is guiding to 30% revenue growth for 2025, with adjusted EBITDA margins expanding from 3.8% to 13.5%. Flutter projects 28% US revenue growth for 2025, with adjusted EBITDA margins expanding to 15.2% from 8.7%.
New York's sports betting market shattered expectations in October 2025, setting a new national benchmark for online wagering. According to data from the New York State Gaming Commission, bettors staked an unprecedented $2.64 billion on sports—the highest monthly handle ever recorded in the U.S. The milestone marked a 13% year-over-year increase and surpassed the previous record of $2.49 billion set in January.
After taking in over $93 billion in total legal wagers so far in 2025, the US has now seen nearly $558 billion in bets at legal sportsbooks since the Professional and Amateur Sports Protection Act was repealed in 2018.
In 2025, 20% of U.S. adults placed a sports bet, up from 12% in 2023, spending an average of $3,284 annually. Over 80% of wagers happen on mobile, with parlays making up about 27% of bets in significant markets.
The Race for Third
Behind the dominant duopoly, a fierce competition has emerged for third place.
While some companies appeared positioned to be frontrunners as digital sports betting swept the nation, BetMGM is the closest to catching DraftKings or FanDuel, and its market share is still only about 30-35 percent of either.
There are multiple obvious candidates for third place—BetMGM, Caesars Sportsbook, ESPN Bet and Fanatics Sportsbook. And there are a few other possibilities. What two of those big companies have in common is a thread that stakeholders, analysts and those in the industry say is critical: Technology-first companies have a leg up.
The Fox Bet partnership that The Stars Group established has not achieved its original ambitions. FOX Bet and another iGaming brand in PokerStars contributed $91 million of Flutter's $313 million U.S. loss in 2022. FOX Bet never held a major market share in any of the four markets it was live in.
ESPN Bet exits New York without ever achieving a 3% market share or generating $50 million in total revenue.
Tax Headwinds
The lucrative U.S. market comes with significant tax burdens that increasingly pressure operator margins.
Certain U.S. states impose some of the highest sports betting tax rates in the world, 51% of gross gaming revenue in New York, Rhode Island, and New Hampshire. These high taxes have been cited as a factor in operator exits, with brands such as Unibet, Betway, and SuperBook pulling back from U.S. markets. High tax burdens can limit innovation, deter smaller operators, and reduce long-term market competition.
Illinois instituted new progressive tax rates effective July 1, 2024, including: 20% of annual adjusted gross sports wagering receipts up to $30 million; 25% in excess of $30 million but not to exceed $50 million; 30% in excess of $50 million but not to exceed $100 million; 35% in excess of $100 million but not to exceed $200 million. The 40% tax will be felt only by DraftKings and FanDuel, which was the intent of the tax structure modification.
XIV. The Online Poker Market in 2025: Shifting SandsWhile sports betting has become Flutter Entertainment's primary growth engine, the online poker market that Isai Scheinberg pioneered has undergone a dramatic competitive transformation. The brand that once seemed unassailable has lost its market leadership.
For many years, PokerStars was the undisputed leader of the online poker industry. However, GGPoker came from Asia and dethroned them.
As of June 2025, GGPoker is the largest online poker network by both average and peak traffic numbers. This creates benefits at every stake level, more active cash tables, frequent running tournaments, and easier access to new or specialty formats at any hour.
At its current traffic levels, GGPoker has secured a commanding lead over all other dot-com operators, accounting for more than half of the international online poker market. Even when combining the traffic of PokerStars, iPoker network, partypoker, 888poker, Unibet, and third-tier networks, GGPoker still surpasses them all.
In comparison, PokerStars, once the undisputed king of online poker, currently averages around 2,000 concurrent seats—just a fraction of GGPoker's numbers.
According to October tracking data, GGPoker holds the leading position with an average ~36% market share among major rooms. PokerStars follows with ~25%, and WPT Global completes the Top-3 with around 15%. Together, these three ecosystems control roughly 76% of the observable cash-game market.
The recognition of GGPoker's dominance has been formalized by industry awards. "GGPoker stands as the world's largest and most innovative online poker operator, dominating the industry with unmatched growth, record-breaking tournament series, and a robust global player base," noted the EGR jury. "In the past year, GGPoker's World Festival awarded over $324 million in prizes with 5.6 million entries—far surpassing all competitors."
Historically, PokerStars has dominated the Poker Operator of the Year category, securing six titles since 2013, winning three consecutive years from 2014 to 2016, and again in 2020, 2021, and 2023. GGPoker now joins this elite group, claiming victories in 2024 and 2025 and becoming the fourth poker operator to have won an award in this category since 2013.
In September 2025, GGPoker celebrated another major milestone on social media, with over half a million players logged in simultaneously. This achievement reflects GGPoker's exceptional growth trajectory.
PokerStars' flagship series in 2025, the Spring Championship of Online Poker, reached a collective $125 million in prizes. Its main event featured a $6 million guarantee and ended with a $7.4 million prize pool. These are strong numbers but fall short of GGPoker's benchmark.
The remarkable fall of PokerStars from market dominance illustrates the fundamental truth that even the most dominant technology platforms can be displaced when competitors innovate more aggressively. The brand that Isai Scheinberg built, which seemed impregnable for over fifteen years, has been overtaken by a newer competitor that moved faster and introduced more innovations.
XV. Flutter Entertainment: Strategy and Outlook### The Flutter Edge Strategy
The entity that emerged from The Stars Group merger has continued to execute an aggressive growth strategy, centered on what management calls the "Flutter Edge"—the company's proprietary technology platform and competitive advantages that it deploys across its portfolio of local brands.
Flutter's technology-enabled market expansion strategy focuses on effectively integrating recent acquisitions like Snai in Italy and NSX Group in Brazil, with expected operating cost synergies of at least €70 million through technology integration for Snai. The company's proprietary technology platform, developed over more than 30 years, provides a foundation for rapid deployment in new markets, allowing Flutter to quickly implement proven betting and gaming products in newly regulated markets.
Adding Snai to the Flutter portfolio will increase Flutter's online market share in Italy to approximately 30%. Snai has a strong base of highly engaged omnichannel customers along with one of the most recognizable brands which is expected to expand and diversify customer acquisition opportunities for Flutter in Italy. Delivering meaningful value creation, through access to the Flutter Edge, with target operating cost synergies of at least €70m, to be achieved within three years of closing at a cost of 1.25x and capex synergies at €10m.
The transaction demonstrates Flutter's powerful optionality as an 'and' business and aligns perfectly with our strategy for value creating M&A. The combination of NSX's extensive local expertise, alongside our existing Brazilian business and the advantages of the Flutter Edge, creates a compelling opportunity to capitalize on the exciting runway of future growth in Brazil. Under the transaction agreement, on completion, Flutter has paid cash consideration of approximately $350m and contributed its existing Betfair Brazil business, in return for a 56% stake in the newly combined Flutter Brazil business.
Acquisition Activity in 2025
Flutter Entertainment has made 12 acquisitions across sectors such as Gambling Tech, Sports Tech, Mobile Gaming and others. Snaitech, NSX and MaxBet are its latest acquisitions.
Media has covered Flutter Entertainment for a total of 120 events in the last 1 year, 16 of them have been about acquisition activity. Key transactions include the completion of the NSX acquisition in Brazil, and the agreement for Flutter to secure 100% FanDuel ownership as Boyd agreed to a $1.76B stake sale.
Flutter aims to raise $1,755 million through this offering and an incremental debt facility to finance the acquisition of a minority interest in FanDuel and extend its partnership with Boyd Interactive Gaming Holdings.
Financial Outlook and Guidance
Looking ahead, Flutter has increased its full-year revenue guidance for 2025, anticipating $17.08 billion, a 22% year-over-year increase. Adjusted EBITDA is projected to reach $3.18 billion, reflecting a 35% growth. These figures are bolstered by recent acquisitions, with underlying growth expected at 14% for revenue and 30% for adjusted EBITDA.
FanDuel's adjusted EBITDA in the US is projected to increase significantly by 176% from 2024 levels, with an expected range of $1.28 billion to $1.52 billion for 2025. This reflects strong operational execution and favorable sports betting market trends. Flutter plans to repurchase $1 billion in shares during 2025.
In fiscal year 2024, Flutter allocated $820 million to technology R&D. This investment supports a global team of approximately 7,700 technologists. Strategic investments are directed towards replatforming initiatives, the application of AI and ML, and bolstering data security measures.
Flutter's market leadership is most evident in the United States, where it holds a 43% share of the sports betting market and a 27% share in iGaming, according to its Q1 2025 shareholder letter. This dominance is driven by aggressive expansion, including its 100% ownership of FanDuel, which captured 51% of U.S. net gaming revenue in Q2 2024.
XVI. Closing Thoughts: The Arc of an Industry
The Stars Group story spans from the launch of PokerStars on September 11, 2001, through Black Friday in April 2011, the Amaya acquisition in 2014, the Baazov scandal, the transformation under Rafi Ashkenazi, and finally the Flutter merger that closed in May 2020. It encompasses the rise and fall of online poker's Wild West era, the emergence of regulated sports betting as the industry's primary growth driver, and the consolidation that has created massive global gaming platforms.
Isai Scheinberg, the quiet mathematician who built PokerStars from his Toronto basement, created a company that dominated global online poker for nearly two decades. His son Mark emerged from the sale with a fortune exceeding $5 billion. David Baazov, the high school dropout who engineered the audacious acquisition that created The Stars Group, saw his career ended by insider trading charges that were ultimately dismissed on procedural grounds but destroyed his reputation and forced his exit from the company he founded.
The industry that all these individuals helped shape has grown from a gray-market curiosity into a multi-billion dollar global enterprise. The U.S. sports betting market alone now handles more than $100 billion in annual wagers, with major media companies and sports leagues embracing the business they once treated as a pariah. Online poker, while no longer the industry's growth driver, continues to expand with projected revenues reaching into the hundreds of billions by 2034.
The competitive dynamics have shifted dramatically. PokerStars, once seemingly unassailable, has been overtaken by GGPoker in online poker. FanDuel, which came to Flutter through a separate acquisition rather than The Stars Group deal, has become the crown jewel driving U.S. market share. The Fox Bet partnership that represented The Stars Group's U.S. sports betting strategy has failed to achieve its original ambitions.
Flutter Entertainment now stands as one of the world's largest gambling companies, with a portfolio spanning Paddy Power, Betfair, FanDuel, PokerStars, Sky Betting & Gaming, Sisal, Snai, and numerous regional operators across dozens of markets. The company's strategy continues to emphasize the "Flutter Edge"—deploying global technology capabilities across local hero brands, acquiring leadership positions in newly regulated markets, and driving operational synergies through platform consolidation.
The regulatory environment continues to evolve. In the UK, new stake limits, affordability checks, and the statutory gambling levy represent a significant tightening of oversight. Across Europe, national frameworks are converging around common themes of player protection and responsible gambling. In the U.S., the industry faces mounting tax pressures as states seek to maximize revenue from gambling operators.
The lessons of The Stars Group story remain relevant. Technology creates moats—but only temporarily, as GGPoker's displacement of PokerStars demonstrates. Regulatory strategy remains a competitive weapon, but the stakes for missteps are higher than ever. Trust remains the ultimate asset in financial services, and the brands that maintain customer confidence through regulatory turbulence will survive.
For investors in Flutter and its competitors, the key metrics remain average monthly players, revenue per active player, and market share in key jurisdictions. The industry continues to see consolidation, with scale advantages in technology, marketing, and regulatory compliance compounding over time. The next chapter will be written by those companies that can navigate increasingly complex regulatory environments while continuing to innovate in product and technology.
The Stars Group no longer exists as an independent company. But its legacy—PokerStars, the technology platform, the lessons learned through scandal and transformation—lives on within Flutter Entertainment, informing the strategies and operations of what has become one of the world's largest gambling enterprises. From a Toronto basement to a global powerhouse: the story of online gambling's evolution, told through the rise, transformation, and ultimate absorption of The Stars Group.
Based on the existing article outline and the search results, the article appears substantially complete. The original outline's final section was "IX. Playbook: Business & Investing Lessons" which has been covered, along with extensive epilogue sections (X-XVI) that were added. Let me review what remains to be written according to the outline and add any final elements needed to complete the article properly.
XVII. Coda: Where They Are Now
The Principals
The individuals who shaped The Stars Group's trajectory have scattered across different sectors and pursuits, their trajectories reflecting the dramatic nature of the company's history.
Isai Scheinberg, the Lithuanian-born mathematician who built PokerStars from his Toronto basement, finally resolved his legal status with U.S. authorities. After nearly a decade avoiding American soil, he voluntarily surrendered in January 2020 and received a sentence of no jail time and a $30,000 fine—a remarkably lenient outcome given the scope of the original indictment. Now approaching his late seventies, Scheinberg has largely retreated from public life, his legacy secured by the platform he built and the fortune it generated.
Mark Scheinberg, Isai's son and co-founder, has channeled his PokerStars wealth into building a luxury hospitality empire through Mohari Hospitality. The firm's portfolio now includes stakes in some of the world's most prestigious properties, including the Peninsula Resort in Papagayo, the Ritz-Carlton Yacht Collection, and the Four Seasons Private Residences in Washington, D.C. With a net worth exceeding $5 billion, Mark stands as one of the wealthiest individuals to emerge from the gaming industry.
David Baazov, the audacious entrepreneur who engineered the PokerStars acquisition, has maintained a lower profile since his 2018 departure from The Stars Group. The insider trading charges against him were stayed due to prosecutorial misconduct, meaning he was neither convicted nor acquitted. His reputation in the gaming industry remains complicated—he accomplished something extraordinary with the PokerStars acquisition, but the circumstances of his departure cast a permanent shadow.
Rafi Ashkenazi, who guided The Stars Group through its transformation and ultimately into the Flutter merger, served as a key executive during the company's diversification phase. His operational expertise helped stabilize the company following Baazov's departure and position it for the strategic combination with Flutter.
The Industry Veterans
Many of the players who appeared on Black Friday's indictment list eventually resolved their cases with varying outcomes. Full Tilt Poker's executives faced more severe consequences than their PokerStars counterparts, reflecting the fundamental difference between a company that kept player funds safe and one that operated what prosecutors characterized as a Ponzi scheme.
The professional poker players who had endorsed Full Tilt Poker—including Phil Ivey, Howard Lederer, and Chris Ferguson—faced years of reputational damage. The question of what they knew about Full Tilt's financial condition remains debated within the poker community. Ivey has continued his poker career and eventually resolved his disputes with Full Tilt's receivers, but the episode remains a cautionary tale about the risks of lending one's name to financial enterprises without understanding their operations.
Chris Moneymaker, whose 2003 World Series of Poker victory launched the poker boom that made PokerStars' success possible, continues to serve as an ambassador for the game. His story remains the industry's most powerful marketing asset—proof that an ordinary person can turn a small investment into life-changing wealth through a combination of skill and luck.
XVIII. The Investment Thesis: Where It Stands Today
Flutter Entertainment's Position
As of November 2025, Flutter Entertainment trades on the New York Stock Exchange (NYSE: FLUT) following its primary listing move from London in May 2024. The stock trades at approximately $193.31, down 38% from its 52-week high of $313.69 and near its 52-week low of $189.40.
Analysts note that Flutter shares look relatively cheap at current levels, trading at 20x P/E and 16x EV/EBIT after factoring in UK tax increases. However, concerns remain about the slowing U.S. sports betting market and the timeline for returns on management's investments in prediction markets. The firm has highlighted potential growth opportunities from new state liberalizations in the U.S.
Recent Performance and Guidance
Flutter released Q3 2025 results on November 12, 2025, announcing updated guidance and the launch of "FanDuel Predicts" in December. The quarter showed solid group performance with average monthly players up 9% and revenue up 17% year-over-year, reflecting the benefit of Snai and Betnacional acquisitions combined with excellent organic iGaming growth.
However, the quarter also revealed challenges. Sportsbook revenue declined 5% year-over-year due to the temporary impacts of sports results and very high levels of promotional spending from competitors at NFL season start, leading to Q3 Adjusted EBITDA of $51 million, down 12% year-over-year.
The India Setback
A significant development emerged in Q3 2025 when Flutter laid off nearly 800 employees across its Delhi and Bengaluru offices following the forced closure of real-money gaming operations in India. Peter Jackson, CEO of Flutter Entertainment, explained that "the enactment of the Promotion and Regulation of Online Gaming Act, 2025 forced Junglee and all other operators to immediately cease real-money operations."
Flutter disclosed a non-cash impairment charge of $556 million in its Q3 2025 earnings, reflecting the indefinite shutdown of real-money gaming in India. The company estimates a $70 million revenue loss and a $30 million EBITDA decline in 2025 due to the regulatory shift. By 2026, the projected damage widens to $250 million in lost revenue and a $90 million EBITDA fall. For 2027, the company expects revenue erosion of $310 million and an EBITDA decline of $130 million.
Jackson expressed disappointment with the sudden regulatory change: "Flutter has invested significantly in India over the last number of years, responsibly delivering innovative skill-based games to Indian customers. Junglee will now only offer free-to-play gaming content as we assess our medium-term options in that market."
Capital Allocation
Flutter announced a $245 million share buyback program commencing October 1, 2025, as part of a broader multi-year share repurchase program of up to $5 billion initiated in September 2024, with the company expecting to return around $1 billion to shareholders in 2025.
The company's acquisitive posture continues. Q2 2025 results showed international revenue and adjusted EBITDA growth of 15% and 13% respectively, including the benefit of Snai and NSX acquisitions.
XIX. The Online Poker Market: A Changed Landscape
Market Projections
The online poker market that Isai Scheinberg helped create continues to grow, though it now represents a smaller piece of the overall online gambling pie. The global online poker market size was estimated at USD 3.86 billion in 2024 and is expected to reach USD 4.24 billion in 2025, growing at a compound annual growth rate of 10.2% from 2025 to 2030 to reach USD 6.90 billion by 2030.
With more than 500 active platforms and 100 million players worldwide, the online poker industry is strengthening its position in the global iGaming ecosystem. According to industry trend data, the global online poker market reached a turnover of $5.3 billion in 2024 and is projected to reach $11.4 billion by 2030, with analysts estimating a compound annual growth rate of 13.7%.
Technology and Innovation
Hybrid poker tournaments combining online qualifiers with live in-person finals are gaining momentum across Europe and North America. This format enables broader participation while preserving the prestige of live championship events. Organizations like the World Series of Poker (WSOP) and World Poker Tour (WPT) now regularly integrate online stages into their major events to increase accessibility and engagement.
In addition to the spread of the internet and smartphones, factors driving the growth of the online poker market include artificial intelligence-based gaming features and regulatory developments.
Recent industry developments include Americas Cardroom launching its iOS app in May 2025, and GGPoker's landmark acquisition of the WSOP brand in August 2024, signaling a major shift through the consolidation of online and offline ecosystems.
Regional Dynamics
North America leads the global online poker industry with a 35% market share. Legalization, high disposable income, and public interest in poker have contributed to this leadership. Additionally, the Multistate Internet Gaming Agreement (MSIGA) increases the liquidity of licensed platforms.
The Asia Pacific region is expected to grow at the highest CAGR of over 11% from 2025 to 2030.
XX. Final Reflections: The Arc Complete
The story of The Stars Group represents one of the most complete business narratives of the digital age—a story with a clear beginning, middle, and end, populated by memorable characters making consequential decisions under conditions of profound uncertainty.
It begins with a mathematician's vision in a Toronto basement, where Isai Scheinberg recognized that software could transform poker from a game played in smoky back rooms into a global entertainment phenomenon. It accelerates through the Moneymaker Effect, when a single tournament result catalyzed explosive growth. It darkens on Black Friday, when the U.S. government shut down an industry and revealed the difference between operators who protected their customers and those who betrayed them.
The story's middle act belongs to David Baazov, whose audacious acquisition of PokerStars represented both the possibilities and dangers of leveraged entrepreneurship. He accomplished something that conventional wisdom deemed impossible, then saw his creation slip away amid allegations he denies but could never definitively disprove.
The conclusion arrives with the Flutter merger—a transaction that valued The Stars Group at nearly £5 billion and created one of the world's largest gambling companies. The brands that emerged from this history now operate within a diversified global platform, their fortunes intertwined with sports betting, casino games, and the continued evolution of regulated gambling markets.
The Enduring Lessons
For students of business strategy, The Stars Group saga offers several enduring insights.
First, technology creates moats—but only temporarily. PokerStars' technical superiority gave it an enormous advantage in the early 2000s, enabling it to capture market share when competitors faltered. But that advantage proved less durable than the customer relationships and brand trust the company built alongside it. GGPoker's rise demonstrates that even the most dominant platforms can be displaced when competitors innovate more aggressively.
Second, regulatory strategy is a competitive weapon. The Scheinbergs' willingness to remain in the U.S. market after UIGEA represented a calculated bet that paid off enormously in market share, even though it eventually forced their exit from the company. The lesson isn't that companies should ignore laws—it's that regulatory ambiguity creates both risks and opportunities that require careful evaluation.
Third, trust is the ultimate asset in financial services. When Black Friday revealed Full Tilt's fraud, PokerStars' reputation for integrity became its most valuable possession. The company had spent years building customer trust through segregated accounts, responsive support, and fair gameplay. That investment paid dividends when the industry faced its greatest crisis.
Fourth, leverage amplifies everything—returns and risks alike. The Amaya acquisition demonstrated the extraordinary outcomes possible when a small company uses leverage to acquire a larger one. It also demonstrated the fragility such structures create, leaving little room for error and exposing the entire enterprise to reputational risks that might not matter to a more conservatively financed company.
Fifth, consolidation is the natural end state of maturing industries. The online gambling industry has followed the classic pattern of fragmentation giving way to consolidation as scale advantages in technology, marketing, and regulatory compliance compound over time. Flutter Entertainment's position today—as one of the world's largest gambling companies with operations across dozens of markets—represents the logical outcome of this dynamic.
The Human Element
Behind the strategic frameworks and financial metrics, The Stars Group story remains fundamentally human. It's about a father and son who built something extraordinary together. It's about a young entrepreneur who believed he could accomplish the impossible—and did, until his ambition outran his judgment. It's about millions of poker players around the world who found community, competition, and occasionally fortune through the platforms these companies built.
The game of poker itself serves as an apt metaphor for the business decisions that shaped this industry. In poker, as in business, success requires a combination of skill and luck. Players must make decisions with incomplete information, manage risk carefully, and sometimes take bold action when the odds favor them. The best players understand that a single hand doesn't define a career—what matters is making good decisions consistently over thousands of hands, understanding that variance will produce both triumphant victories and painful losses along the way.
Isai Scheinberg, the recreational poker player who became an industry titan, understood this better than most. He built PokerStars not as a get-rich-quick scheme but as a long-term enterprise focused on customer value and technical excellence. When the variance of regulatory enforcement finally caught up with him, he had positioned his company to survive and ultimately thrive. And when he finally surrendered to U.S. authorities in 2020, nearly a decade after Black Friday, he received a sentence that reflected the totality of his record—the violations he committed, but also the customers he protected and the industry he helped build.
The cards have been dealt, the bets have been made, and the hands have been played. The Stars Group no longer exists as an independent company, but its legacy endures in the platforms it created, the industry it shaped, and the lessons it teaches about the possibilities and perils of entrepreneurship at the frontier of technology and regulation. For those who study business history, it remains one of the most instructive and entertaining stories of the digital age—a tale of ambition, innovation, scandal, and transformation that could only have happened at this particular moment in time, when the internet was young, the regulatory environment was uncertain, and a few visionaries saw the future before anyone else.
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