Exclusive: betr in new fundraise
Micro-betting specialist raises up to $30m, LosIngresos+Mas launch, Betclic’s tax woes, crypto exchanges go mainstream +More
Good morning. On the Weekender agenda:
Jake Paul-fronted betr rumored to be raising $30m.
+More Media launches LosIngresos+Mas.
The French tax authorities have beef with Betclic.
Mainstream banks eye crypto exchange potential in sector watch.
Jobsboard by BettingJobs features Marketing Manager and Casino Operations Manager roles.
When I say I love you, you say you better.
betr raise
New cash raise will value the company at $300m.
Better off: The micro-betting specialist fronted by Jake Paul and led by CEO Joey Levy is raising up to a further $30m and valuing the business at ~$300m, according to multiple sources spoken to by E+M. It is thought the new money will go towards an unspecified launch into iCasino.
betr has been up and running in Ohio for four months and launched in Massachusetts last month.
According to the latest figures provided to E+M by EKG, in Ohio betr has achieved less than 1% market share of handle and less than a tenth of a percent of GGR.
betr did not respond to enquiries from E+M.
Break the mold: Recall, betr announced its initial funding round in August last year when it raised $50m for a $250m valuation. It said at the time it was going to “disrupt legacy gambling and legacy media”.
The betting operation is centered on micro-betting and it shares ownership links with micro-betting supplier Simplebet.
However, the recent acquisition of the source code for FansUnite’s Chameleon platform signals a move into more traditional pre-match and in-play betting as well as iCasino.
The deal for the platform involved $2.2m of cash and $1.5m of equity up front, with a further $2.2m cash element and $1.5m of equity payable in one year's time.
You don’t miss your water: A $30m raise would revive an otherwise moribund startup funding market, where announced deals in the betting and gaming sector have almost come to a standstill.
As tracked by E+M, there have not been any betting and gaming-related funding rounds announced since early April, when BeyondPlay ($5m) and Prophet Exchange ($10m) announced raises.
A $30m raise would also be the biggest of the year to date.
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ICYMI
+More Media launched the Spanish-language, LatAm-facing LosIngressos+Mas this week. In the debut edition, Peru amends gambling and betting laws to prevent money laundering, Codere Online earnings analyzed and, in Mexico, AMLO threatens to revoke all licenses for the establishment of casinos issued in the last four years.
In Compliance+More this week, lawyers said that Entain’s HMRC bribery case update was “surprising”.
On the Gambling Files this week, E+M’s own Scott Longley spoke to Jon and Fintan about the recent quarter’s earnings and the M&A chatter surrounding Kindred.
Earlier in the week, Earnings+More covered LeoVegas’s gray market exit-related earnings droop.
Lastly, Sharpr this week took a look into Real Luck’s latest esports betting-related earnings.
Betclic’s tax beef
Betclic parent FL Entertainment’s Q1 results eclipsed by news of tax investigation.
An inspector calls: Betclic parent company FL Entertainment’s Q1 results were overshadowed by news that a French court has authorized the county's tax inspectors to continue their investigation into the activities of the online bookmaker’s Malta subsidiary.
The tax inspectors suspect Betclic of operating in France via its Malta-based subsidiary and not being up-to-date with its tax declarations.
In a statement to AFP the group rejected any accusation of tax fraud and said "Betclic respects all of France’s tax and social regulations”.
Does your dog bite? In October last year Betclic’s offices in Bordeaux were raided by tax inspectors and documents relating to activities by its Malta subsidiary were seized. Betclic filed an appeal against the procedure, but this was rejected in late May.
That is not my dog: Commenting on its decision, the Bordeaux Court of Appeal said there were a “number of clues” that indicated that Betclic’s Malta division recorded “part of its commercial activities on the French territory”.
Betclic said the authorities’ actions were based on an “incorrect analysis” of the group’s organization and that it has significant human and technical resources based in Malta as part of its worldwide operations.
Earnings: Betclic’s Q1 OSB and iCasino revenues were up 14.5% to €244m and adj. EBITDA rose 8% to €63m. CEO Francois Riahi said the results were in line with guidance and that the World Cup had helped drive sign-ups, with the number of unique active players rising 42%.
Earnings in brief
Intralot: Revenues were down 8% YoY to €89.5m but EBITDA increased 29% to €33.7m in Q1, helped by the impact from the discontinuation of its Malta operations. Chair and CEO Sokratis Kokkalis said he was proud of the group’s organic EBITDA growth.
European revenues were down 56% to €16m but revenues from the Americas increased 11% to €58m.
Las Vegas bounce
Surprisingly strong April data points to continued Strip confidence.
Solid as a rock: The Las Vegas Strip enjoyed a 5% YoY increase in GGR to $625m, marking a notable growth at the start of a seasonally slower Q2. The rise came despite visitation being flat YoY and conference attendance falling 2% due to changes in the timings of certain events.
Total GGR rose 2.8% to $1.16bn, helped in particular by a 10% rise in Downtown GGR. However, locals GGR was off by 2% YoY.
The team at Truist noted that questions around economic headwinds and tougher comps remained but that the strong event calendar in Q4 and Q1 next year provided a counterbalance.
This includes F1 in November, a “strong” Raiders home schedule and the Super Bowl next year.
Macau rising
Back to life: May GGR rose 5.7% MoM to $1.94bn, representing a huge 350%+ leap YoY, but the rate of increase was a “slight deceleration” from April, according to the team at CBRE. Roth MKM analysts said May was the first month in 2023 where GGR “did not surprise on the upside”.
The figures were also below consensus, which CBRE suggested had assumed sequential improvements with the benefit of Golden Week in May.
They indicated the looming threat of a Chinese economic slowdown is now weighing on prospects.
“However, we believe the Macau recovery could continue even amid an economic slowdown in China, considering multi-year pent-up demand for leisure, travel and entertainment,” the team added.
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Sector watch – crypto trading
The big banks are looking to muscle in on the digital currency trade.
Blue blood: After a string of high-profile failures and collapses, including FTX, Celsius and now the Winklevoss twins’ Gemini, the FT has reported that big banking names are looking to step into the breach.
The paper said that Standard Chartered, Nomura and Charles Schwab were all in the process of building the infrastructure necessary to trade digital markets.
The new platforms would go some way to answering the fears of institutional investors over the unregulated nature of the current crop of exchanges.
The paper quoted one digital assets analyst as saying that “large, pedigreed, traditional institutional investors definitely prefer dealing with counterparties who they know have been in existence for years”.
Winter turns to spring: While the crypto winter claimed some high-profile names, and put pressure on the whole of the exchange sector, the rebound this year has benefited those that remained, including Binance, BtcTurk, Upbit and Bitpanda, which have all seen a substantial rebound in trading volumes.
But the FT cited a recent survey of 250 asset managers, which found that half would switch from a crypto-native exchange to a traditional-backed company if given the chance.
In particular, 90% said they would trust a traditional finance group with custody of their crypto tokens.
Crypto custody is seen as the first step for establishing credibility.
“It’s safer and foundational,” one analyst told the paper. “It’s a low margin activity, you have to do two to three tasks and you have to do it well.
Newslines
BetMakers Technology is to shed 23% of its workforce as part of a cost-cutting exercise that it hopes will save it A$20m long term. CEO Jake Henson said the changes would provide a “clear path to profitability”.
Rivalry has launched its mobile betting and gaming app in Ontario. The group said it will enable residents to bet on esports and traditional sports alike.
GiG board member Tomasz Juroszek has purchased 400k GiG shares priced at SEK27 via his Juroszek Holding vehicle. Juroszek is also the majority shareholder at Polish-facing bookmaker STS.
Kambi is to provide its mobile-betting solution to Puerto Rico’s betting operator ApuestraPR, part of LMG Gaming.
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What we’re reading
Vice: The rise and fall of the hipster. “That guy who used to do bumps of K off a little spoon at parties and once auditioned for the Klaxons is probably a 30-something hypebeast now who works in consultancy and buys CBD candles from Goodhood.”
Calendar
Jun 2: Elys Game Technology
Jun 8: Gaming in Holland
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