Circa Staring at More Than $4M in Overlays for Football Contests

Posted on: September 6, 2022, 03:00h. 

Last updated on: September 6, 2022, 05:50h.

Todd Shriber @etfgodfather Read More
Expertise: Financial, Gaming Business, Mergers and Acquisitions.

With less than four days before entry deadlines arrive, Circa Sports is looking at overlays — the cash the gaming company has to pony up itself — to meet the guaranteed $12 million in prizes for its two famous NFL contests.

Circa contests
Circa Sportsbook in downtown Las Vegas. The operator is looking at big overlays for its football contests. (Image: Las Vegas Weekly)

On Monday, the Las Vegas Review-Journal reported Circa Sports was looking at an overlay of $4.5 million for Circa Millions IV and Circa Survivor. Later in the day, Circa Sportsbook Operations Manager Jeffrey Benson tweeted the figure was $4.22 million.

To reach the promised $12 million in prizes, each contest needs at least 6,000 entries. As of this writing, there are 3,297 entries in Circa Millions IV, meaning the overlay currently resides at $2.7 million, according to the contest’s website. Circa Survivor has 4,505 entries, with an overlay of $1.49 million.

Circa Millions allows participants to buy up to three entries at $1,000 apiece, while the Survivor contest permits a maximum of six entries per person at $1,000 each. Additionally, survivor players that opt to use the Week 1 Thursday night tilt — the Buffalo Bills at the defending Super Bowl Champion Los Angeles Rams — as their game for this week and get that pick wrong can rebuy into the contest, as long as those new entries are purchased by 2 P.M. Las Vegas time on Saturday, Sept. 10.

Why Circa Overlay Is Big Deal

Circa may avoid the overlay obligation on the survivor contest, assuming an influx of entries materializes over the next few days. But it’s a stretch regarding Circa Millions.

The Las Vegas-based gaming company doesn’t take a rake on the contests, meaning it’s not directly making money from these offerings. Rather, the now-famous competitions bolster the Circa Sports brand and lure customers to the most prestigious integrated resort in downtown Las Vegas. In addition to Circa, the privately held company controls D Las Vegas, Golden Gate Hotel & Casino, and Downtown Las Vegas Events Center.

The gaming company may make up for the costs of operating the contests by participants coming to its properties to play slots, table games, and eat. But relying on those avenues to make up for $4 million in overlays could be a stretch. Add to that, Circa founder and CEO Derek Stevens admits the company took a beating on the survivor contest last year.

In addition to the $6 million in guaranteed prizes in that contest, Circa offers a bonus of $1 million for participants who make it to the final week of the season without picking the previous season’s Super Bowl teams — the Rams and the Cincinnati Bengals.

Overlays not Uncommon

Gaming companies facing overlays in contests of this nature isn’t uncommon. For example, William Hill, a unit of Caesars Entertainment, is looking at a six-figure overlay for its college football contest, according to the Review-Journal.

Circa Survivor may avoid that fate based on the perception that picking one team per week without a spread is easier than selecting five teams with spreads, as Circa Millions requires.

Indeed, Circa Millions participants face a tough road to the top prize. Last year’s winner went 63-27 against the spread, good for a winning percentage of 70%. That’s staggering when considering 54% or 55% against the spread is viewed as “good” in the world of sports betting.