hello viewers and welcome to the latest huddle I'm with Matt Heyman co-founder of the game day Matt thanks very much for for rejoining us my pleasure being here um we're going to talk about some some pretty exciting stuff uh Us online Sports Bing Market bit of ey gaming maybe but uh to start off with can you tell us uh what's been the latest at the game day uh well I mean it's been a big year um we kind of look at statistics year-over-year and at the start the year we looked at um New York being a new market in 2022 Ohio being a new market in 2023 how would we do right Apples to Apples same betting season same sports calendar really good chance to test a new market versus a new market yeah clearly New York bigger State etc etc us we kind of weighed that against us having grown for a year and really got to test you know everybody's Bonus Pack to say how have we done on uh on growing our business in in a near identical market so uh we were 5x for Revenue in um January this year versus January the previous year it's always a good thing always exciting and fast forwarding to September the question is always can you keep that momentum right and growth Etc and then when we look September over September the good news is on registrations and first-time deposits were 2x last year so what's nice is we're already Big Y but we're continuing to put some big numbers on the board and grow and I think the piece that maybe we didn't see coming would be the mix of Revenue and you mentioned sports betting eye gaming I think sweeps also something to start talking about seriously yeah I think that's something um we had we had Matt Davey on earlier and he was he was discussing uh sweep stakes and and fantasy so definitely definitely take your point in that yeah um you guys are quite uniquely placed uh in in a sort of a spot uh I guess between affiliate and and sports Bing media if that's if that's fair to say yeah um a couple of follow-up questions from that um more specifically obviously want to talk to about ESPN bet because I think that's that's one of the the biggest talking points of the moment sure but let's tee that up by if I were to ask you what's your take on the The Wider trend of uh convergence uh media um and betting coming together so I think there's a couple themes in that one is always in in media I think we need to think about conventional media so everything up to digital and then think about digital and so I think when the most obvious example would be I don't know my say great uncle watches I'm from Winnipeg so he watches NHL hockey and he might say oh my God there's all these betting adverts where the hell they come from and so there's a natural convergence even through someone whose 90s eyes and that's happened I think on you more to the um question of digital and how are kind of the legaliza the broader legalization of online sports betting um I think the real convergence will come when when we feel as comfortable on the digital feed seeing the score as we do seeing the line so the score of the game and the line on the game and so I think that we're close at the moment in terms of convergence in terms of like message and media as in here's an advert or click here too dot dot dot or some in-game betting which is pretty micro at the moment I'm actually a big believer in the longer term on that but putting that aside for the moment I think we're maybe 20% down the road on convergence okay where it's um the ability to see and bet simultaneously yeah or the ability my last business for example ran a watch along so you'd be watching the game say on television but through your phone you might be having a Facebook feed of an alternative um alternative commentary and so that to me is real convergence where you're actually watching the game but maybe only finding out where the line's at where the sharp what the Sharpies are up to etc etc it doesn't feel like we're there yet in any way shape or form and then of course there's ultimate convergence which is just click on screen to bet which is I think you know it's a little bit sci-fi but it's probably coming as well M so you uh I mean it might be a silly question given that where you are at the game day you know that's kind of your your business but you're a firm believer that that model um works because I guess a counter point is if someone uh for example me in the UK I'll uh actually it's not a good example because Sky bet is so good and Sky Sports but let's say let's say that's a hell of a compliment cuz once Sky bought my last business Sky integrated with us and we started to a lot of that work so I'm going to only pause you there to say thank you very much let's say then let's say I looked at uh flash score flash scores for my for my scores um and I I bet with bet 365 and for me the two are separate and you know the is there is there a I guess the question is how big of the market is there a segment that would maybe never cross the two o you live in the UK yes you know that some games are streamed via B bet 365 directly they don't actually go through um sky or a other so in that case it's really integrated experience and you can actually be on your phone watching playing at the same time yeah and that to me that kind of lean leanin culture is really why um after selling my previous business we did the game day particularly specifically in the US where DFS got people leaning into sports content yeah in a way that they hadn't around 25 years ago so I really felt as as things legalized people are already leaning in to real-time gameplay through setting up you however they're playing their DFS piece but they're actually feel like they're participating in the game it's an active digital experience already so that slight small move to putting some money in behind it to me felt like it was going to come hard and fast and I think there's been examples where that's lived up to the promise and probably examples where hasn't quite got there yet does that answer your question it does I I think the the main answer is yes you're a proponent and you've given some very strong examples of of how it works so um yeah I think I think definitely did did answer it and let's let's apply this as I me as I teased earlier specifically to ESPN bet okay um yeah yeah um big big story big news uh you know we were all over it when it came out because it was almost like it's happened it's ESPN bet is is a thing it been Ted for a long time but I guess the big question is conversion um you know how successful will they be yeah I think it's probably challenging in the near term because there's just a lot of learning to moving from being a media company to convergence um I think the piece where they particularly maybe aren't that analogous to Sky Sky Bet which has been obviously a massive success yeah is that sky I believe had spent a lot of time with Richard before he sold the business and I I believe they had 15 years of legal online betting before Sky Bet started and Sky would have been running a lot of ads and seen a lot of what worked and didn't work before they launched skybet the second piece is you know he had we became fairly close and he told me kind of two or three things that they really needed to focus on through that trajectory and I I think business and particularly in this sector it's so competitive it really is going to come down to having the right bums in the right seats so it's not just a matter of launching through a massive partner which again it looks on the surface like sky Sky Bet ESPN is you it's the name in town yeah um but I really believe that they're going to have to hire and probably rehire to make sure that they've got the best kind of um fighter pilots to make sure that that thing fulfills in the promise and that just takes time yeah and so I believe probably sky with before Sky Bet had a longer Runway of learning and secondly they probably were fairly spoiled for choice in terms of how who they had running that business yeah and ultimately you know Richard did feel um when we were working together which is the period around 189 2018 2019 that they made two or three critical choices in their trajectory then on ESPN and Pen yeah I think My worry is we haven't done much business with pen mhm so my worry there is is pen the best fighter pilot for that partnership do they have the best product in Market do they understand how to use media tie up so the left hand and right hand work immediately together and so I do think that ESPN is an amazing business um and most importantly in sport a lot of people don't understand where the power of the ad call sits where the flexibility with rights sit what can and can't be done you as someone who spent now quite a lot of my career in digital media in sport they are the daddy the question will be do they have the product in support to be nimble on the other side to deliver to your penpoint I think um a completely different style of company in bar stool but we've seen obviously that that that didn't quite work out so I don't know if there's any learnings for the for the wi industry there um a point to to that I'd like to make as well um see if see if I'm right or wrong but with ESPN obviously you've got the media side but they do also have quite a big fantasy database so could they a question I've asked a few people could they follow potentially perhaps not as successfully but well who knows maybe they will the fanuel DraftKings model of let's convert a lot of those fantasy players into sports betters as well I think there's yes probably and now we're starting to get thankfully into the weeds so an example there would be how much experience do they have converting customers to a subscription or to TV product yeah and I don't believe that ESPN has that much experience I think they probably they primarily work through cable and distribution so they're not that used to managing an End customer yeah as in like a consumer whereas a group like Sky coming back to that literally are the front end they're taking your credit card details and so they understand what customer support looks like what LTV looks like how to keep customers there when they're trying to quit or not letting them quit at all you know I can have offline jokes about that but I think I think there's a big difference between optimizing for LTV and just and being the biggest voice in market and so then come back to pen has will pen solve for those things and I think that's a question mark that Still Remains whether it's the bar stool example or or a another it's a question mark that I think we all should have yeah particularly around things like loyalty LTV I mean this town's been built on those things and so the bar is awfully High I'm not saying it's insurmountable but it's awfully yeah it's an exciting time for for neutrals um people involved in the industry because we've got ESPN bet but then we've also got the Fanatics example and when we talk about conversion um you know massive company um a slightly different model uh the aim is obviously merchandising to sports betting I mean I don't know what your what Your views are there again it's an that's an untested skip in the record at least the the the first one that you're challenging me on with ESPN and Pen has been done before and it's been done well through media Partnerships the idea that you're mov moving from you know t-shirts to betting um there's a natural question mark there I think where there's real strength is an a Founder Le business again coming back to this town the name plate shows that founder Le businesses in Bedding do win it's similar in media there's a lot of founder L businesses that have been extraordinarily successful yeah so at a at a at a large scale so they've kind of got the right guy in the right seat and to negate what I was saying before around ESPN not necessarily understand understanding a consumer retention experience the whole fanatic's pitch $30 billion company has been around rather than printing and selling T-shirts through third parties we will own that end consumer and so check big check in that box probably Beyond where people um maybe understand if if people want to go away and do a little homework check out the founder check where he's come from check that his CRM creds are better than the best and so that piece sold for the piece that's unsold for then is how you convince people that that's a betting product that can be known and trusted yeah and weirdly my first business at age 17 was screen printing t-shirts I'm not quite sure I could have convinced the people wearing that shirt to place a bet with me now Fanatics is clearly a different level to that whole thing for in terms of from M and Paw shop but when I go to our team and there you know these are seasoned Professionals in um the online Sports beding and con and that conversion space towards getting um people to convert to a betting name they actually really feel strongly that the four leaders in in the market being um the two digital plays and then um MGM and Caesars they really feel there brand Equity there and that that brand Equity helps those uh helps our um Partners yeah and our voice and Market convert and so I'm I think that new voice in Market it's exciting and they can probably mark it to their current database would be their pitch yeah but can they actually get them to press yes on a bet it's a it's a bit of a skip in the record that's that's pretty hard to to bring together yeah I mean I would ask you I know we had prepared questions but when I think about you know trying to move platforms from a broad customer base to um monetization do you think that Twitter would be better placed to start to do that it's an interesting it's an interesting question it's it's something we have covered in an article before the amount of the amount of betting on Twitter because there a lot of sharp players on Twitter as well um I mean it's an interesting question uh you know I'm I'm usually I'm used to asking the question so H it's an it's it's an interesting one to think about well the thesis hav question the fanatic's thesis is you can move people from having an association with their team and their interests to placing a bet yeah I mean X has got that times 10 10,000 in terms of where we are what we're doing all the different conversations we're involved in even ones we don't know we're having U because we don't know when it's open or not open on our phone seemingly which is a bit odd in its own own way but putting that aside we also know that X has aspirations to become a payment platform but you know just having a payment platform for payment platforms re you know for that to exist probably isn't going to attract consumers the hook would be actually to say here's a nice way to match up media with payments and the easiest way way to do that is through an online bat so do you think that's something that that will happen in the future or is that more of a they haven't done it yet and is that because that shows how difficult it is to actually convert on X yeah um I think it's there's a couple steps to it one is they probably have their own fire fires to fight internally two you know Ma musk's aspiration for X if you go back 30 years was to create a payment platform or 25 years and maybe his new ex is the best way to do that but number three um in terms of all the different ways that they could get towards becoming a payment platform how high up the stack does gambling sit I'm sure you know there's a couple checks in the right box one um a call to action to place a bed is a very compelling call to action for a lot of people yeah so there you that works the exit so pardon the pun um the mark against would be the Reg atory issues yeah sure and I'm not quite sure you know Elon wants to disclose his wealth etc etc in a regulated environment Etc um and take on take on gambling in that way yeah so that would be maybe the hold back would be the regulatory um handcuffs yeah but that's a whole an interesting a whole new field that you you've sort of a whole new discussion that you've created there within this interview I'm sorry to take that away oh that that's absolutely fine but um um when it comes to I mean previously it was suggested that someone like an Amazon or a Google could get involved in in sports betting and that would change the whole game but we're yet to see that and I think possibly some of the reasons you've no maybe not the reasons you've suggested there but I think maybe it's more a case of scale with that like Amazon and e-commerce and and make so much you know the the the S quartly revenues uh was it sort of 200 billion that kind of thing it's uh gambling I don't know would probably be a small Splash in that ocean I think uh yeah I think there's a couple reasons there you one is do they have a stated aspiration to become a payment platform two are they already bumping into regulatory issues definitely um and then three I think right now they're probably making quite a lot of money and happy in their position as a search partner I'm not quite sure they would need to move into becoming that there's not enough marginal interest maybe for them to be in to be looking at becoming um a a kind of a betting affiliate or or betting operator either one of the two whereas you look at Twitter and it's probably kind kind of more of a natural place to to go they also could probably use the money and it's funny sometimes Money Talks even for Deca billionaires yeah absolutely maybe especially for Deca billionaires Money Talks you never know yeah so I I definitely appreciate you putting me on the spot earlier with with the X thing pleasure um and I'm going to try my best to uh to flip it over and put you on with yeah with a um don't poke the giant predictions for 2024 and maybe even beyond that um if we were to pick if you were to pick uh winner of the market and when I say winner not someone who's going to lead the market because in sports buing right now that's Fuel and that's even if it might change it's probably not going to for a short while but if I was to say a winner of 2023 for me that would be DraftKings because they have made gains in terms of uh inter fules market share in some States they're the handle leader in some states they are the revenue leader but they've moved towards profitability and and I think 2023 has been a great year for DraftKings if if you were to pick you know who could be that kind of could be DraftKings again could be someone else in 2024 where would you go with that can I give two answers absolutely okay so the first one is I I have to say I'm following your lead and I think DraftKings now have a lot of momentum um and momentum in consumer mind mindset remember I talked about the value of a franchise yeah and those big four andity yeah and it it's hard to get it's really hard to get in sports betting you know coming from Europe as we do people have multiple apps on their phone and they're always sort of flirting around going for the offer going for this going for the onds right checking you know different I'm relating to that as a sports now that's terrific I'm glad you're not King me out on that one it's pretty well proven in almost all markets in the world that's what people do and so it's a disloyal by its very nature it's a disloyal kind of cohort so to to get that momentum is very hard um and it feels like they're now very well managed they've given up kind of some special projects which frankly we were a little bit worried about like where are they going key customer of ours we also really like them um that's another thing in this industry is people don't realize we all know each other and like each other and it seems really competitive and I'm sure in some you know boardrooms it really does you a lot of shouting but at sort of our level which is kind of we're you know big in in the affiliate space but sort of midlevel in terms of operator world it's pretty congenial we're all in it together and we all really want to have like a good customers more of them and so I would say as you've as we've seen the franchise of DraftKings kind of one say no to a number of kind of side businesses and two really focus it on building its franchise that's a momentum that for me barring kind of a meteorite hitting within the industry that's that's got a lot of promise for and 2024 is just you know moments away yeah the other piece that when we talked earlier um we do get to chat before the cameras come on I I thought of I thought of the kind of the it's one of the oldest games in this town but one of the new G newest names in our world I thought about the Caesars move and what they're going to do next and putting the right bums on the seats the right team is now here Etc I think it's really exciting to see that name within the conventional space but and and that's that's a piece that you know we have to put our chips behind different names I that's one that that for us is really interesting I think the other play though and I wouldn't single out a single name because it' be a bit bold but probably all things being equal something I got very wrong and now we're writing that is we have a lot of customers we convert into this space and we didn't focus on sweep stakes and now we are just tapping the glass and the appetite from the consumer to go and and and engage there is enormous and so probably I would say it'll go from a space that you and I understand as people who follow the industry really closely to a sort of oh my goodness goodness uh knuckle in the knee type of growth or hockey stick growth and that might overexpose them and throw them into a regulatory Spotlight but if they play that all right instead of DFS type of gently gently going back whatever it is 15 years if that can be managed again I preface this with all things being equal that will just be that will be an out of control offering sitting here um this time next year yeah which hopefully we get the chance to do absolutely yeah I mean the sweep stake piece very interesting I'm quite interested to to to hear Caesar mentioned because there's a lot of talk about ESPN better Fanatics I'm guilty of that myself you know the headline Grabbers Fel DraftKings and B MGM but Caesar I I personally hear mentioned less so it's interesting to as you say that brand equity and they got the right team in place you know let's let's watch that space I think yeah it's also maybe a bit simpler proposition to manage because it's not a JV yeah um that's a good point yeah so I think that you know at that level you know when we kind of have people pitch into either invest in or advise the company one thing they really like is we've got a really strong and United board behind us and a group of investors who really want us to remain private and grow for we've got a lot of momentum so people don't want to sell right that's why there's more inbounds than outbounds that's how the valuation of something goes up so more buyers than sellers simple and I think around the table that simple structure will serve Caesars very well and they also have for me a kind of um understated competitive Advantage which is they can bring together both landbased and digital and I think um if they really think about how to do that in a thoughtful way then that will be extremely powerful I mean you think of the the revitalization postco of Vegas we couldn't even get a room in their hotel yeah um and so you know these companies really know how to make the most of their assets sets and I think that that convergence could be kind of the race in the hole yeah um as you say hopefully we we can we can sit back here again next time next year and and look back on you know how how season have progressed but yeah some I think some yeah some some strong some strong points there there's a no pressure on them you know there's there's a few competitive advantages you've named there but uh you have to get it right you know powerful tools there's also an undercurrent right now in terms of the state of the market there's really four states that have legalized Casino versus you know uh depending how measure um regulated in sport just under 30 yeah and so I think where that's if you look at the pi um just by regulatory point of view put that one aside and then you look at it just by money point of view and the pi reverses uh almost literally yeah and so what you've got there is a brand that's very very strong in cassino MH and so that reverse pi to me you know if I was you know at which I'm not on the their board or had a voice at that level it would be like actually we have an amazing franchise in the world of online betting yeah it's just not yet online sports betting and so they can they can kind of what's it called punch above their weight yeah absolutely well uh Matt been uh been terrific discussing the industry with you like I said let's let's do it again sometime soon pleasure and uh yeah thanks for your time yeah thank you again see you in a year's time absolutely