Fanatics cites Sky Bet as ‘second-mover model
Fanatics cites Sky Bet as ‘second-mover modelFanatics’ plans, OSB’s inflection point, DraftKings’ unruffled investors, GeoComply ‘mimicry’ evidence +MoreGood morning. On today’s agenda:
Pic via Brian Hall/TwitterGetting fanaticalFanatics will “play the role of innovator” when it launches online. Zoom in: The unlikely format of a streamed Massachusetts Gaming Commission suitability hearing gave insight into the thinking behind Fanatics’ upcoming betting and gaming launch. Leading the presentation, CEO of Fanatics Betting & Gaming Matt King said the company hoped to disrupt a market led by “day one” operators.
Second shall be first: When talking about the experience his team brought to the business, King pointed out SVP of trading Andy Wright’s experience with Sky Bet, which he said was “very analogous” to BetFanatics.
Coming upE+M’s latest edition of Due Diligence being sent tomorrow will focus on the chances of the new entrants cashing the US online party. ** SPONSOR’S MESSAGE: BettingJobs is the global leading recruitment solutions provider to the iGaming, Sports Betting and Lotteries sectors. Boasting a 19-year track record supporting the iGaming industry, and with a team of experts and world class knowledge, it’s no surprise BettingJobs is experiencing rapid growth with outstanding results. Does your company have plans to expand teams to cope with strong growth and demand? Contact BettingJobs.com today where their dedicated team members will help you find exactly what you are looking for. OSB inflectionAhead of the BetFanatics launch, EKG says it sees a new dynamic emerging in US sports betting. Ripe: The GGR market share dominance of the top four or five across most US markets might suggest “something of a settled state”, but the “underlying dynamics” suggest something different is going on,” said the team at EKG.
The shares weekThe shareholders of online betting and gaming bellwether DraftKings appear unruffled by the prospects of new competition. No fear: In among reports of Fanatics’ preparations to launch in Maryland within the next week and the debut of betr in Ohio, the share price reaction of DraftKings last week suggested investors aren’t too worried by the competitive threat. Since January 1, its shares are up nearly 28%. 🥳 Not fussed: DraftKings enjoys a 16.5% rise last week GeoComply’s ‘mimicry evidence’GeoComply manages to get damning expert analysis submitted suggesting XPoint copied code in patent case. Sincerest form of flattery: GeoComply has managed to get a damning report produced on behalf of Hard Rock, which claims XPoint’s code “mimics” that of GeoComply and uses “identical” code processes, submitted as evidence. The report suggested the evidence of mimicry is a “big concern” as “should GeoComply become aware of the copying of their product, they could issue a cease and desist”.
Do not track: In other findings, Terflorth’s investigations also suggested XPoint “appears” to copy code from another company, where the developer team worked, which was producing ad location software, and that the XPoint app leaves “open” a device’s location when not in use, which it says is a “major flag”.
XPoint no-background: XPoint secured a funding round in October led by Bettor Capital, Courtside Ventures, Acies Investments, the Raine Group and SuRo Capital. Its first deployment in the US came in late September when it announced its XPoint Verify product was live in New Jersey with Sporttrade. Q4 previewOnline gaming is poised for a strong earnings season, suggests JMP. Hammering the cramps: Favorable hold, declining promotions, some recent positive state launches and high adoption rates should “underscore” the positive about the upcoming reporting season, said JMP. Notably, the team have adjusted their model to account for better-than-expected sports results, with Q4 sports-betting GGR now expected to be up 40% QoQ and iCasino up 15%.
Union city bluesDeutsche Bank suggests there will be some upward wage pressure from the current labor union negotiation in Las Vegas. Pay the man: The current labor agreement across the 34 Strip casinos negotiated in 2018 expires in May and the team at Deutsche Bank anticipated some “upward pressure on the prior annual escalator in the upcoming negotiations”. Under that deal the compensation escalator was in the range of 2-5%.
Analyst takesTruist: Last year proved how valuations could diverge from fundamentals when investors are fearfully looking ahead to a potential recession. Now, the analysts at Truist indicated, the market will need to see some weakness and then a meaningful recovery in order to break out of its current range.
REIT review: Having last week added four Pure Canadian properties to its portfolio for $200m, completed the $1.2bn MGM Grand and Mandalay Bay acquisition and raised nearly $1bn from investors, JMP suggested there was more to come for VICI.
Startup focus – GridRivalWho, what, where and when: Founded in 2019 by Portland-based Ross Fruin and Jeff Shinrock, GridRival is the world’s only multi-series fantasy motorsports gaming platform that has already surpassed 200k. Funding backgrounder: The company completed a seed round of $3m In October 2021, led by prominent Chicago-based sports-tech fund KB Partners and with the involvement of Sharp Alpha Advisors, ESPT Ventures and Benjie Cherniak. The pitch: Despite F1 coming to Las Vegas next year, the sport has never been too popular in the US, suggests Shinrock. For this reason, motorsport remains “hugely undervalued as a betting commodity” and its growing fanbase is “not adequately catered for by traditional sportsbooks,” he adds.
What will success look like? GridRival launched its DFS product in 23 states in Q4 2022. “GridRival has been built by racing fans for racing fans – and it’s a point of pride that we have been so well received by the motorsports community,” says co-founder Shinrock.
The week aheadKambi will present to their investors on Thursday. In its Q3 earnings, it said revenue dropped 12% while EBITDA was off by 47%. Within the last fortnight it has extended its partnership with Rush Street and announced a platform deal with Miami Valley Gaming in Ohio. Growth company newsWhat’s up doc? Former startup focus subjects WagerWire and Sparket have teamed up and integrated their platforms, allowing Sparket users to trade using the WagerWire platform. Zach Doctor, WagerWire’s CEO, said the partnership “paves the way to an entirely new era of betting”.
Gaming Society has partnered with the International Gaming Institute, an adjunct of the University of Nevada Las Vegas, to support betting’s relationship with women’s sports and provide betting education. U.S. Integrity has announced Elys Game Technology as its latest partner for event monitoring, market intelligence and fraud prevention for the US market. DatalinesAGA tracker: US commercial gaming revenue grew by 2.4% year-over-year in November, the 21st successive month of comparative growth, with nationwide gaming win reaching $5.02bn. It means that in the first 11 months of 2022, total GGR stood at $54.9bn, 13.5% up ahead of the same period in 2021. NewslinesNew York luxury store Saks Fifth Avenue has confirmed that it will bid for a casino license to be situated on the top floors of its flagship store. What we’re readingPersonal services: VAIX’s Andreas Hartmann and the race for retention. CalendarJan 17: Due Diligence #3 Jan 19: Kambi Capital Markets Day Jan 26: Rank FY ContactThis is a +More Media publication. For sponsorship enquiries, email scott@andmore.media. |
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Due Diligence #3
Friday, January 20, 2023
New entrants enter the OSB fray, Kindred serial warnings, recent analyst takes +More
Entain exits unregulated markets
Friday, January 20, 2023
Entain says NGR/EBITDA impact will be small, Macau junket operator ordered to pay $831m fine, Macquarie's 2023 outlook, New Jersey December, analyst takes +More
Deal Talk #6
Tuesday, January 10, 2023
PointsBet's Oz sale, sector-related M&A deals in 2022 worth $10bn, IGAC SPAC downs PlayUp merger, gaming affiliate M&A is back (sort of) +More
Exclusive – Simplebet scouting NCAA games
Monday, January 9, 2023
Micro-betting supplier goes in-stadia for data, November sees OSB declines across majority of states, startup focus – Outlier +More
Weekend Edition #79
Friday, January 6, 2023
Bet365's year, Caesars vote of confidence, Fanatics' Candy talk, Genius/BetConstruct settlement, sector watch – Italian cash access +More
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