Genius Sports CFO Nick Taylor has said in-play betting in the US will continue to grow as a “natural evolution” after DraftKings revealed more than 50% of all stakes in Q1 were made mid-match.
Speaking at the 20th Annual Needham Technology, Media and Consumer 1×1 Conference on 9 May, Taylor said the supplier was confident in-play betting had plenty of runway for growth.
His comments came after DraftKings CEO Jason Robins told analysts that more than 50% of the operator’s handle in Q1 came from live betting, as he cited last year’s M&A as a key differentiator.
The Boston-based giant snapped up Simplebet, SportsIQ and Mustard Golf, all of which Robins suggested had allowed the firm to expand the percentage of stakes coming from in-play betting.
DraftKings has made clear its ambition to become the number one operator in terms of live betting, while Taylor said the continued uptake of those types of betting behaviours would continue.
The Genius Sports finance chief noted there had been existing growth in in-play as a percentage of total bets, adding this was to be of expected of the US when PASPA fell in 2018.
He said: “We’ve seen it move from 25% to 30%, that’s our broad estimates in what we can see. It’s time and customer familiarity. This is a natural evolution. We were saying this four years ago. We’ve seen it in every mature market. It’s playing out exactly how we expected it to play out.
“The timings of how this happens isn’t always linear, but we said it was going to be a product and we’ve seen this. The new contracts are structured in a slightly different way, but it is sort of 3x on an in-play sports bet in revenue for Genius versus a pre-play sports bet.”
Needham analyst Bernie McTernan also asked Taylor about Genius Sports’ plans given it has around $235.7m (£179m) in cash on hand, as per its Q1 earnings.
Management have already sanctioned a $100m share buyback programme, while CEO Mark Locke said on the firm’s Q1 analyst call earlier this month that M&A remains an option.
On the call, Locke said: “I think M&A is a big focus, but we have to very careful about what we’re buying. You kiss a lot of frogs, I think is the phrase, and we’re doing a lot of kissing, but we expect some of them will turn into princesses at some point.”
Referencing the CEO’s comments on the Needham panel, Taylor echoed Locke’s points, arguing that any purchases would have to significantly move the needle for the New York-listed business.
Taylor added: “We’re looking, we’re out there. What we’re looking for is subscale, high quality sports tech. But two things I’m looking at is it has to be margin accretive [and also] cash accretive.
“We’ve worked hard over the last four years to get ourselves into the 20-plus EBITDA margins to be cash positive. We’re not going to throw that away on speculative acquisitions.”
The post Genius Sports CFO: Increasing US in-play uptake is a “natural evolution” first appeared on EGR Intel.
Nick Taylor says product has plenty of headroom for expansion after DraftKings boss Jason Robins said more than 50% of stakes came from live betting in Q1
The post Genius Sports CFO: Increasing US in-play uptake is a “natural evolution” first appeared on EGR Intel.