Just how rapidly the sports betting world is changing was evidenced by the report that Sportradar received million in separate investments from three prominent Americans—NBA team owners Mark Cuban, Michael Jordan and Ted Leonis.
Sportradar is the world’s leading provider of data to the sports industry for a variety of uses, from setting odds to detecting fraud and game fixing.
Sportradar is unknown to most Americans, an obscure Swiss company in an industry almost invisible to everyone but the international sports establishments.
That is changing rapidly. Today, Sportradar has an American headquarters in Minneapolis, a client list that includes the NFL, NHL, FanDuel, and big ambitions, including the NBA, as evidenced by recruiting Cuban, Jordan and Leonis.
The Sportradar development is just the latest in the increasingly global sports betting business that is spawning new sub industries.
The best known among the new industries is daily fantasy sports, where privately owned DraftKings and FanDuel grab headlines at almost the same pace as their advertisements pop up on sports telecasts.
More recently, there is eSports, the phenomenon in which people play fantasy sports against each other, much like in exchange wagering, an industry invented by yet another relatively new and global company now with an American presence, Betfair.
Related to this is the phenomenon of people packing arenas to watch other people play electronic games, an activity that has potential for DFS and eSports.
To date, most of the action is in privately held companies, though there are a few small public DFS companies. A lot of big public companies are investors or stakeholders in DFS—Comcast, Fox, Time Warner and Disney among them.
But their investments, or stakes, are unlikely to move the needle much at such big companies, and their investments can be looked at as something like lottery tickets, nice if DFS hits it big, but no great loss if it fizzles.
DFS aside, there are other rapidly changing developments in the world of sports betting.
One is the arrival in the U.S. of companies that have long done business in the U.K.—traditional sports betting firms like William Hill; exchange wagering giant Betfair, which offers account wagering services in the U.S.; Sportech, which is a tote service provider and OTB operator in the U.S. and a soccer betting company in the U.K.; Amaya, which is primarily an online poker provider but is moving into the sports business with DFS, and others.
All of these companies are publicly traded in the U.K., except Amaya, which lists in Toronto.
As such, they are plays for investors who seek out public companies.
And, as the industry continues its rapid evolution and globalization, others will move into the U.S., such as London-listed Paddy Power.
Not long ago, investing in foreign-listed stocks was limited to a minority of investors, even among institutional firms. But today, if one wants to play in the gaming space, especially online or in some aspect of sports betting, then companies such as those listed in the preceding few paragraphs have to be on the list.
And that, as much as anything, is the lesson to be drawn from Messrs. Cuban, Jordan and Leonis putting their money into Sportradar.
