Earnings+More - Learning to fly
Learning to flyWhere next once proof of concept has been achieved? Plus, Sharp Alpha raises cash, Prime on a zero marketing regime +More
Well, I started down a dirty road. Flying lessonsI guess I’ll know when I get there: Getting to the point of being able to prove an idea actually works is merely the first step in a long journey for a startup. But convincing investors to finance a project beyond the minimal viable product stage is a trickier task. Sparks fly: The Ireland-based We The Bookie came directly from a “lightbulb moment” on the part of founder Malcolm Wilkinson. “The model is that we operate like a ‘normal’ sportsbook, using industry-average odds,” he says.
First time around: Wilkinson is not an industry insider and, indeed, We the Bookie is his first attempt at starting a company. Understandably, he is learning lessons along the way. “The first six months were devoted to proving to myself the model would be financially viable,” he says.
Making it count: But the biggest initial lesson covers that area of funding. To get the project off the ground, Wilkinson raised €150k in a friends and family round. “Raising at the idea stage is very challenging, especially when you are a first-time founder,” he says.
More money has since been forthcoming to fund the transition to a new platform, after the initial choice was found to be not fit for purpose, with two tranches of €50k added to the pot – one in December and the latest just this month – at a pre-money valuation of €4m. Sportsbook platforms don’t go live every day, and certainly not ones as sophisticated as this… Sounds interesting? Find out more here: www.metricgaming.com Metric Gaming – Your in-house sportsbook, outsourced. Proving groundMetric of the light: Wilkinson suggests the unplanned platform switch actually provided a proof point for the concept, in that almost all the customers from the first iteration “patiently waited” and re-registered on the new platform.
However, with further capital to fund a customer acquisition marketing campaign, coming up with a customer acquisition proof point has been tricky. “We’ve had mixed success with promotional events,” Wilkinson says.
But Wilkinson says he regrets not having raised more both initially and post-launch. “Zero marketing budget is double-edged as it reduces traction, which makes raising capital from institutional investors more challenging.”
On the circuit: Being from outside the industry, Wilkinson says his main route into speaking and pitching to potential investors is through the conference circuit. “I find that creating investor materials and pitching to investors focusses my attention in important areas that could get lost in the shuffle of running a live business,” he explains.
Being in the gambling sector limits any startup’s options, with the somewhat controversial nature of the business precluding founders from much of the institutional help that exists for other industries.
Would like to meet: Still, Wilkinson holds out hopes of being able to entice a next round of investment on the promise of a unique idea. “Investors are generally intrigued by our model but almost all have the same requirement: traction,” he says.
+More startupsFunding roundsPlayer conversion and reactivation services provider Enteractive secured a new limited and non-controlling investment from Bettor Capital in order to fund a further push into the US market.
Poly tunnel: Crypto-based prediction market provider Polymarket has raised $45m in a Series B round led by Peter Thiel’s Founders Fund. The company has now raised $70m in total. Growth company newsProp-betting supplier specialist Sports IQ was sold to DraftKings for an undisclosed amount, which sources suggested could be upwards of $50m. The decentralized betting exchange BetDex, founded by ex-FanDuel co-founder Nigel Eccles, has officially launched operations in Ireland. Toronto-listed esports and Gen Z-focused sports-betting operator Rivalry has launched the $RVLRY token. What we’re readingKicking the startup habit: Tim Heath talks to Investing.com about why Yolo Fund II will be looking more at companies with a “proven track record of success who know precisely what they need from a funding partner.” The month in focuses
Inside the raise – Sharp AlphaFix up, look sharp: The oversubscribed $25m fund raise undertaken by the sector-endemic venture fund Sharp Alpha points to what principal at the company Lloyd Danzig suggests is an “increasingly favorable” fundraising environment. Speaking to E+M, Danzig says that with 2023 proving to be very challenging for startups and funds alike, it does appear the market has now “found bottom.”
Pen to paper: One change in the dynamic in 2024 versus what went before, Danzig suggests, is that investors are writing fewer checks but of a higher value and with a higher-conviction.
One other dynamic more apparent now than previously becomes evident when looking at the pool of companies Danzig hopes to be investing in, which, he suggests, now tend to be “lean, nimble and relentlessly resourceful.”
Apply within: In terms of where the $25m+ will be heading, Danzig says his firm has its own set of “fundamental beliefs” around consumer psychology, economics and tailwinds in competitive entertainment that will continue to drive deployment.
IDComply makes it easy to maintain higher pass rates while meeting Know Your Customer requirements, offering 50% higher pass rates than using knowledge-based authentication alone. Our customers enjoy access to a range of enhanced diligence options with just one simple integration! Built for the gaming industry, with your end users in mind. Book a demo to learn more. Prime timeNone but the brave: A B2C startup in the US OSB market is a rare thing given the long list of established national and international gambling companies – such as Churchill Downs, Wynn Resorts, Unibet and 888 – to have cut their losses and exited the space in the years since PASPA was repealed.
Clutching victory from the jaws of defeat: The Prime sportsbook rose from the ashes of Brennan’s previous venture SportAD, which launched fantasy sports in casinos five-and-a-half weeks before Covid shut them down.
On location: Prime has launched in states with large metropolitan areas or which border states where sports betting has not been legalized. Ohio, for example, has big sporting cities such as Columbus, Cleveland and Cincinnati but also borders Pittsburgh, Detroit, Indianapolis and Louisville. New Jersey will cover New York and Philadelphia. Kentucky is next.
Progress report: Prime Sportsbook launched in Ohio in September 2023 and it became New Jersey’s 19th online sports-betting operator in March this year. It quickly rose from last place among Ohio’s 20 sports-betting operators to 10th, just behind Hard Rock and above the likes of Rush Street Interactive, Bally’s, Betr and Parx.
“Circa Sports is the only regulated sportsbook doing something similar to us,” he says. “Large bettors are always looking for more places to get money down. And we’re just one more place. If you can get just 10-15% of their payroll then you will have a good business.” Calendar
EveryMatrix delivers iGaming software, solutions, content and services for casino, sports betting, payments, and affiliate/agent management to 300+ global Tier-1 operators and newer brands. The platform is modular, scalable, and compliant, allowing operators to choose the optimal solution depending on their needs. EveryMatrix empowers clients to unleash bold ideas and deliver outstanding player experiences in regulated markets. An +More Media publication. For sponsorship inquiries email scott@andmore.media. |
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