Earnings+More - The startup month - August
The startup month - AugustThe funding crunch (or is it?), Underdog Fantasy leads the month’s fundraisings, inside Future Anthem’s recent funding round and a startup (re)focus on SnapOdds.Hello and welcome to the first edition of our new regular newsletter sent every first Tuesday of the month. In this debut issue:
If you were forwarded this email and would like to subscribe to the Earnings+More newsletter, click below: The funding crunch
The figures confirm fears that investment for growth companies is harder to come by than previously and this goes as much for the betting and gaming sector as any other. “The report highlights in no uncertain terms what most of us already intuitively know,” says Benjie Cherniak, principal at Avenue H Capital who is invested in a large number of startups in and around the betting and gaming space. “There is less capital being deployed now versus the previous year.”
A new dynamic: Chris Grove, partner at Acies Investments, suggests what money there is for funding in the sector “is pooling into a relatively small number of companies who share a common characteristic - traction”. “Funders are increasingly willing to pay a premium to reduce uncertainty,” he says.
Sector focus: The macro uncertainty is happening at a time of “sustained annual compound growth,” says Danzig. Or as Heneghan adds, there remains the opportunity to join one of the biggest bandwagons going.
Chalk/cheese: The situation is different again in the UK and Europe. David McLeish, partner at the London law firm Wiggin, suggests “there is a sense (that investment) is getting harder to come by unless someone involved in the early stages has a proven track record in the sector”.
** SPONSOR’S MESSAGE: Red Knot (Redknotcomms.com) provides strategic PR & Marketing counsel to exciting and innovative companies at the intersection of sports, igaming and technology. Kick-started in 2020 by a team of media, sports and betting specialists in New York, London and Dubai, our combined expertise across news, sports and entertainment media, the business of sports, and the explosive gaming sports betting industries, makes us one of a kind. If your business needs a boost, contact Rom@redknotcomms.com The month in fundraisingsHalfway there: Speaking of companies that have achieved traction, Underdog Fantasy has almost reached halfway-to-unicorn status (i.e. a valuation at $1bn+) after it raised $35m in a Series B round which values the business at $485m.
Other recent fundraisings:
Future Anthem fundraisePumped up kicks: The AI and personalization company announced a new fundraise in mid-July, bringing on board betting-and-gaming endemic fund house Bettor Capital which is led by David Van Egmond. E+M caught up with Future Anthem founder and CEO Leigh Nissim to get an insider’s view of how the new funding round came about.
Capital table: Bettor Capital led the new round but Nissim remains the largest single shareholder. “Our capital table is strong,” he notes. Fiorucci made me hardcore: Nissim says that despite the external climate becoming “increasingly challenged”, Bettor Capital remained “just as excited” while existing shareholders “appreciated the momentum” the company has shown.
Milestones: “Everyone needs stepping stones,” says Nissim who says Future Anthem’s milestones include a growing base of monthly recurring revenue, young yet robust products, a strong team across the business, and, finally “a compelling – and believable – vision”. All the kids want to make the scene: Nissim says that last year, with the focus of the entire sector on North America, he felt like Future Anthem was “in danger of missing out and moving too slowly to capitalize on the early market momentum”.
The last dance: “One thing I’ve been pleasantly surprised by is the overwhelming support of everyone I meet for us to succeed as we create this new category with AI in gaming. Many think it’s brave. I just think it’s smart.” Startup (re)focus - SnapOdds
What are the upcoming key milestones for SnapOdds? The company has lined up an expected “five or six major rollouts’ with big names in the sector including large affiliates in the next 12 to 18 months.
Snap, crackle: “It’s exciting for us to see how the app prominently features the ‘Snap’ camera function in the UI, so that users can capture live wagering opportunities instantly by pointing the sportsbook app at a live broadcast at home or in a bar, for example,” Willomitzer adds.
Upside efficiencies: Willomitzer suggests the current macro backdrop and its potential impact on the consumer provides a use case for the app.
The big sell: “The barriers to integration are really very low,” says Willomitzer. “We are talking about 20-30 lines of code that need to be integrated. Growth company newslines
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