Primetime Sports Club
Post-Meeting Analysis & Action Items
Strategic Planning - Legal Compliance & Business Structure
Date: November 4, 2025
Meeting Type: Legal Framework & Compliance Strategy
Attendees: Jordan (PRSM Tech), Team discussing Primetime Sports Club legal framework
🎯 Critical Legal Insight: The "Prize + Chance + Payment" Rule
California Gambling Law
A contest is illegal gambling if it involves ALL THREE:
- Prize - Something of value
- Chance - Random element
- Payment - Required consideration/purchase
The Solution
Remove ANY ONE of these three elements = Legal contest
Initial Strategy: FREE CONTESTS (Phase 1)
Prize Range
$50-$1,200
Gift Cards
Legal Risk
0%
No Payment Required
Purpose
Marketing
Build Audience
Why This Works
- ✓ No payment = no gambling law violation
- ✓ Lowest cost customer acquisition
- ✓ Builds email list for future monetization
- ✓ Pure marketing play to collect user data (email, name, picks)
- ✓ Builds engaged audience before monetization
🏗️ Revised Business Structure: Three-Entity Model
The Problem Identified
- Primetime Sports Club wants to run paid contests with prizes
- California law: Only 501(c)(3) nonprofits can legally run raffles
- Cannot have the SAME entity collecting subscription fees AND paying out prizes
The Proposed Solution
Entity #1: Primetime Sports Club (Community)
- Website/Discord community platform
- Branded as sports betting community
- NOT collecting money for contests
Entity #2: "The Cause" (501(c)(3) Nonprofit)
- Stripe account receives subscriptions
- Runs contests as fundraising activity
- Pays out prizes to winners
- % of revenue → charitable initiatives
- % of revenue → operational costs
Entity #3: PRSM Tech Inc. (Software)
- White-label software provider
- Primetime licenses platform from PRSM
- Clean separation for legal protection
💰 How Money Flows
Revenue Flow Process
- Users subscribe through Stripe checkout
- Stripe account = "The Cause, powered by Primetime Sports"
- 501(c)(3) status on payment processor (tax advantages)
- Percentage funds water borehole projects (~$2.5K each)
- Remaining funds = operational costs (software licensing, staff)
- Contest prizes paid from nonprofit account (legal compliance)
| Revenue Split | Allocation | Purpose |
|---|---|---|
| X% | Charitable Programs | Water borehole projects |
| Y% | Operational Costs | Software licensing, staff, marketing |
| Z% | Contest Prize Pools | Weekly/monthly contest payouts |
Note: Public disclosure required for transparency
💧 The Nonprofit Angle: "The Cause"
Existing Infrastructure
Already have 501(c)(3) nonprofit focused on water access (borehole systems)
Strategic Alignment
- Primetime Sports = Community layer
- The Cause = Fundraising/legal compliance layer
- Goal: 1-3 borehole installations per year
Content Strategy
- Website must show legitimate nonprofit activity
- Documentary videos
- Transparency reports
- Water project updates
"If the SEC goes to our website and all they see is sports betting, we're fucked. It has to show we're doing it as a nonprofit with real charitable work."
🚫 What DOESN'T Work (Lessons from Meeting)
| # | Approach | Status | Reason |
|---|---|---|---|
| 1 | Paid Subscription + Prizes from Same Entity | ❌ | Illegal in California |
| 2 | Betting on Game Winners with Prizes | ❌ | Explicitly illegal |
| 3 | Raffles Without Nonprofit Status | ❌ | Only 501(c)(3) orgs can run raffles in CA |
| 4 | "T-Shirt Loophole" | ❌ | Risky, not recommended for scaling |
| 5 | Outlier Best as Prize-Paying Entity | ❌ | Creates direct gambling connection |
✅ Immediate Action Items (Phase 1 - Pre-Launch)
1. FREE CONTEST PILOT
| Objective | Implementation | Marketing Angle |
|---|---|---|
| Prove concept, build audience, stay 100% legal | Launch FREE weekly NFL pick'em contests Prize: $50 gift cards Entry: Email + name + picks |
"Who do you think will win this week? Enter for a chance at a $50 gift card - FREE!" |
2. BRAND POSITIONING SHIFT
Critical Insight: "Primetime Sports Club is NOT a sports betting company. It's a sports betting COMMUNITY."
❌ Website Messaging to AVOID
- "Win money betting on sports"
- "Get the best picks today"
✅ Website Messaging to USE
- "Join the #1 sports community"
- "Weekly contests and prizes"
- "Supporting [Charitable Cause]"
✅ Immediate Action Items (Continued)
3. OUTLIER BEST SEPARATION
Positioning: Outlier = Pure statistics platform
- "We show sports statistics, nicely layered"
- NO direct betting advice/picks
Integration: Outlier content appears IN Primetime community
- Separate branding, separate entity
- Clean legal firewall
4. LEGAL CONSULTATION PRIORITY
Must Get Clarity On:
- Nonprofit raffle partnership legality
- Player props vs. game winners
- White-label software structure
Next Step: Schedule consultation with sports/gaming attorney. Bring proposed business structure diagram.
🎓 Community Engagement Strategy
Youth Sports Partnerships (Grassroots Idea)
The Vision: Engage directly with student athletes at high schools during practices
Why This Works
- Builds brand at community level
- Sports-obsessed demographic
- NOT promoting gambling to minors
- Just community/stats focus
Expansion Opportunities
- School sponsorships
- Pop-up tents at games
- Financial literacy workshops
- Community events
⚠️ CRITICAL: School/Youth Engagement = NO sports betting promotion to minors. Community and stats ONLY.
📊 Revised Tech Stack & Separation
| Entity | Purpose | Key Technologies |
|---|---|---|
| 1. Primetime Sports Club | Frontend/Community | Next.js, Discord NO payment processing |
| 2. The Cause | Payment/Legal Entity | Stripe Connect (501c3) Receives subscriptions Pays prizes |
| 3. Outlier Best | Data/Statistics Platform | Python microservices API endpoints Standalone stats website |
| 4. PRSM Tech Inc. | Software Licensor | White-label platform owner Licenses software to Primetime |
Entity Separation: Primetime (community) ≠ The Cause (money) ≠ Outlier (stats). Maintain distinct firewalls.
💰 Revenue Model (Post-Nonprofit Structure)
| Tier | Price | Features |
|---|---|---|
| Standard Tier | $40-60/month |
• Community Discord • Weekly FREE contest entries • Outlier Best stats • Charitable funding |
| Hall of Fame Tier | $TBD/month |
• All Standard features • Exclusive Discord channels • Additional contest entries • VIP status |
Key Financial Split
Public disclosure required for transparency:
- X% → The Cause charitable programs (water boreholes)
- Y% → Operational costs (software licensing, staff, marketing)
- Z% → Contest prize pools
🚨 Critical Compliance Notes
| Compliance Item | Requirement |
|---|---|
| Stripe Account Branding |
✅ CORRECT: "The Cause, powered by Primetime Sports" (501(c)(3) must be primary) |
| Website Content Balance |
Must show legitimate nonprofit activity (water project videos) Can't be 100% sports betting content |
| School/Youth Engagement |
NO sports betting promotion to minors Community and stats ONLY |
| Entity Separation |
Primetime (community) ≠ The Cause (money) ≠ Outlier (stats) Maintain distinct firewalls |
🔄 Next Meeting Priorities
Questions for Antoine (Client)
1. Nonprofit Partnership Interest
- Open to partnering with existing 501(c)(3)?
- Comfortable with % revenue to charity?
2. Brand Direction
- Primetime (Community focus) vs. Outlier Best (Stats focus) as primary customer-facing entity?
3. Phase 1 Comfort Level
- Willingness to launch FREE contests first (no revenue)?
- Timeline for scaling?
- Budget for legal?
4. Operational Questions
- Who handles Stripe account (Must be nonprofit)?
- Charitable disbursement management?
📝 Revised Development Roadmap
| Phase | Timeline | Key Tasks | Success Metrics |
|---|---|---|---|
| Phase 1: Free Contest MVP |
Weeks 1-4 |
• Simple contest entry form • Email collection • Basic Discord • $50 prize fulfillment |
• 100+ entries • 50% repeat participation • 500+ engaged users |
| Phase 2: Nonprofit Partnership |
Weeks 5-12 |
• Legal consultation • Partnership agreement • Stripe Connect setup • Website relaunch • First paid tiers |
• Legal approval • First 50 paying subscribers • $0 legal issues |
| Phase 3: Full Platform Launch |
Weeks 13-24 |
• Complete contest automation • Outlier Best integration • School partnership pilot • First water borehole funded |
• Scale to 500+ subscribers |
🎯 Key Takeaways for PRSM Tech
What Changed from Original Plan
BEFORE:
- Direct subscription/prizes
- Single entity
- Aggressive AI betting tools
AFTER:
- FREE contests first
- Three-entity legal separation
- Nonprofit partnership
- Community-first positioning
Technical Priorities Adjusted
| Priority | Tasks |
|---|---|
| HIGH | Simple contest entry system, Email integration, Basic Discord |
| MEDIUM | Stripe Connect (Nonprofit), Subscription tiers, Automated contest lifecycle, Outlier Best API |
| LOWER | AI prediction bots, Real-time odds aggregation (Needs legal review) |
🔐 Legal Risk Mitigation Checklist
| Compliance Item | Status | Solution |
|---|---|---|
| Free Alternative Method of Entry (AMOE) | ✅ | Phase 1 covers this |
| No Prize + Chance + Payment together | ✅ | Nonprofit structure solves |
| Separate entities for money flow | ✅ | Three-company structure |
| 501(c)(3) documentation | ✅ | Partner with The Cause |
| Charitable activity proof | ✅ | Water project content |
| No gambling promotion to minors | ✅ | School engagement guidelines |
| Statistics only (not picks) | ✅ | Outlier positioning |
| Terms of Service review | ✅ | Legal counsel required |
💡 Competitive Advantages from This Structure
Legal Moat
Operates legally in California (strictest state); competitors risk high legal exposure
Brand Differentiation
"Sports community giving back" vs. "gambling platform." Authentic charitable component
Customer Acquisition
Free contests = lowest CAC. Grassroots growth via school partnerships
Tax Advantages
501(c)(3) status on payments
Long-Term Defensibility
Hard-to-copy three-entity and nonprofit relationship model
🎬 Closing Thoughts
This meeting fundamentally reshaped the Primetime Sports Club strategy from a risky direct-to-consumer gambling platform to a legally bulletproof community-first model with authentic charitable impact.
Next Critical Steps
- Run free contest pilot immediately
- Legal consultation on nonprofit structure
- Client buy-in (Antoine) on charitable partnership
- Begin water project content production
- Build Phase 1 MVP (simple contest system)
This is the path forward. Let's build it right. 🏈💧🚀