Interview with Matt Davey on Jai Huddle Podcast
Introduction
- Guest: Matt Davey, CEO of Tech Corp Digital and former CEO of NYX Gaming
- Matt's background: Built NYX Gaming over 15 years, sold to Scientific Games in January 2018
- Discussion Focus: Current ventures, market insights, and industry trends
Current Ventures
TechCorp Digital & TechCorp Capital
- Investment in online sports betting and iGaming markets
- Special Purpose Acquisition Company (SPAC): TechCorp Digital Acquisition Corp
- Raised $250 million in trust
- Target: $1-$2 billion enterprise valuation companies
- TechCorp Capital: Private growth equity investments in both public and private companies
- Investing in companies with innovative ideas solving real problems in US and internationally
Investment Focus
Firms with Nexus to US Market
- Importance of relevance to the US market for public vehicles
- Growth metrics: Great management, technology, intellectual property
- Must have operations in the US
- Attractive opportunities in the US due to the emerging sports betting and gaming market
Types of Companies Targeted
- Home-grown US opportunities: Local entrepreneurial businesses, tech companies
- European mature operators looking to expand into the US market
- Focus on operations in the US rather than other regions (e.g., Africa)
SPAC vs. IPO
Advantages of SPAC for Fast-Growing Companies
- Allows projection of future revenue performance (unlike IPO which focuses on past performance)
- Important for investors looking at future growth rates
- SPAC process includes a PIPE investment for additional capital
- Provides secondary validation from investors
Suitability of SPAC
- Ideal for companies with future growth potential and limited past US results
- Especially relevant in rapidly changing markets like US sports betting and iGaming
Market Dynamics
Consolidation Trends
- Proliferation of operators leading to eventual consolidation
- US market seeing acquisition of European partners by US companies
- Future likely to see US digital-only operators merging with smaller ones
Retail vs. Digital
- Digital channel offers superior experience over retail for sports betting and iGaming
- Political influence of land-based operators remains strong
- Future may see digital operators acquiring land-based ones due to more efficient business models
Online Market Performance
Investment and M&A Trends
- Several notable acquisitions and IPOs in recent years (DraftKings, FanDuel, Caesars, etc.)
- Evolution of US market sees rapid growth from $0 to $billion gross gaming revenue
Future Prospects
- Current market leaders' positions may change over time
- Importance of education and awareness about online gaming
- Long-term potential for industry growth as new states legalize and market matures
Conclusion
- US sports betting market shows significant growth and opportunity
- Significant changes expected in leadership and market dynamics over the next decade
- Exciting times ahead for operators and investors
For more detailed insights from Matt Davey, refer to the CEO special interview on Gaming Insider Magazine.