Since a promotion from COO to replace fellow co-founder Charles Gillespie as Grandstand’s CEO in May, it’s safe to say Kevin McCrystle’s in-tray has been overflowing. He has overseen a company restructure, rebranding and launch of a new product all within the first few months. A tough task? “I think it’s gone as smooth as it can,” McCrystle tells EGR when asked about the transition.
The May restructure meant headcount was slashed by 25% as the affiliate looks to become an AI-first organisation. Two months later, there was a name change from Gambling.com Group that the firm says better reflects the Nasdaq-listed firm’s broad portfolio of brands, such as OddsJam, OpticOdds, Casinos.com and WhichBingo. Then there’s the launch of its high-limit debit card Rollcard, as the business continues to diversify its strategy. “This sits right in the middle of that within our brand ecosystem and feel pretty confident about it” McCrystle explains.
The conversation with the Grandstand boss takes place on a video call after his first quarterly results release and presentation as CEO. Financially, the firm suffered a 5% year-on-year (YoY) dip in Q2 revenue to $37.8m and its share price over the last year is down nearly almost 80% to $1.92.
But his confidence in not only improving Grandstand’s stock price but hitting its full-year guidance in revenue of between $165m and $170m and $45m to $50m in adjusted EBITDA, despite the most recent quarterly results, remains high.
EGR: You stepped into the CEO role in May. How have you found the transition from COO?
Kevin McCrystle (KM): I think it’s gone as smooth as it can. I’m not coming in from outside the company, so I understand the business, the people and how we do things. It’s just expanding into a few other areas, but the biggest change is doing stuff on the corporate side. The initial focus was the restructure and related team changes, and part of that was the AI transformation of the business, which is going really well.
The next thing I wanted to do was refocus the corporate identity. The old name Gambling.com [Group] was not fit for purpose with where we are as a business today. It’s not about anything changing going forward; we’ve already changed the business to where we want to be so it’s nice to finally be able to talk about that. Right now, more than anything, we are focused on granular execution of all the work and making sure we deliver on all the pieces.
EGR: What’s the hardest decision you’ve had to make?
KM: Without any doubt, the restructure. That’s always challenging. We had to let go of some great people so the business can thrive going forward. As the business shifts, there’s certain areas that are more important than others. We needed to reset where we’re investing but also, the world is shifting rapidly with AI and how we need people to work. It’s not the same as it was two years ago. I had to take an honest look and see where we’re at. There are people that have been great for us and I’d recommend [them] for any other company. Just didn’t make sense for us anymore.
EGR: Grandstand has undergone a few name changes since opening its doors as World Sports Network in 2006. The latest is said to reflect on the diversified business since the 2021 IPO. Can you provide more detail about what went behind the switch to Grandstand and the initial reception from the industry.
KM: The reception’s been nothing but positive. It’s something we’ve been thinking about for a year or so. It’s never easy to land on a new name and certainly not something we want to have to change again. Again, Gambling.com just really wasn’t the right description of what we are as a business. It is one of our marketing and affiliate assets and we do a lot more than that right now. We wanted a name that could relay what we’re doing. A lot of our businesses was all consumers. We have a lot of partner services now as well so we needed a name that could include everything. The name reflects where we are as a group today.
EGR: You want Grandstand to be an ‘AI-first’ organisation, but what does this look like in reality and how do you get buy-in from staff?
KM: It’s how we operate. We’re not building any frontier models or anything like that. The key thing with AI I’ve seen is you have to blow people away with what it can do. There’s always going to be some folks pushing back and then they see examples of how powerful it can be and they buy in. It takes some upskilling of certain people. It takes empowering others who are really advanced in AI and keep letting them support other people, while bringing in some new people to keep pushing us forward with how we use it.
It’s certainly not just words. We really are integrating it into everything we’re doing. You have to keep shifting because the AI is shifting so fast. We have been a Claude-heavy organisation, now we’re moving to multi-model solutions. It’s going to be ever evolving just because the AI landscape is shifting so rapidly.
EGR: The Q2 period was your first results since becoming CEO. Revenue slid 5% YoY to $37.8m and EBTIDA fell 44% YoY to $7.7m, in line with expectations. You reiterated guidance despite those dips. What is giving the business the confidence to hit those targets?
KM: There’s a handful of parts of the business that are really growing rapidly and that’s certainly what gives us, and me, the confidence in that. Sports data services, especially the enterprise B2B data sales, that’s growing 50% year on year. North America marketing is also doing really well. There’s a lot of real strength there.
I think everybody knows SEO generally has been challenging for us and most other companies over the past year. It’s a much smaller piece of our business than it was historically. I think long term it’s going to stick around. It’ll still be a nice business for us but it’s probably not a key growth area – a smaller piece of the pie that stabilises the rest of it.
EGR: On the analyst call, you said SEO is “certainly not going away” and that Grandstand will continue to diversify to be less impacted by Google algorithm updates. Where do you see SEO in the next 12 to 24 months?
KM: I think it’s always challenging to predict what another company’s going to do, in this case Google. So far, the shift hasn’t been from Google to AI tools such as ChatGPT. Even a lot of these AI tools are shifting their energy to the enterprise side rather than the consumer side. The integration of AI within Google itself is harder to predict. I don’t think it’s going to materially change from where it is right now.
What we see, though, is there’s just a lot of volatility within search. It makes it harder to rely on as a business but a key thing for us is we are diversifying. I think at this point we’re diversified, though as a lot of these other areas that have nothing to do with SEO, or even marketing, continue to grow, that remains the same path for us.
EGR: The share price has taken a hit in the last 12 months. How do you plan to rectify this?
KM: We missed a few quarters and had lower guidance. That’s never going to help. The most important thing right now is to deliver on expectations, which I feel confident we’re going to do. It’s not going to magically shift the share price back to where it was, though it seems materially underpriced. It’s hard to say that the valuation makes any sense on any level at the moment, but obviously this is what you have to deal with in the public market. What we’re focused on is making sure we deliver on a quarterly basis and, in time, the share price will come back.
EGR: With the NFL season round the corner, how important is the return of the season in terms of growth in that region?
KM: It’s very critical. Our North American business is also very sports heavy, so our business as a whole, shifts a little more to North America and a little more to sports. We see more a seasonal impact from the NFL but, look, the NFL always delivers. I feel good about where we’re at and across our different businesses. It’s going to be a strong September, so I’m looking forward to it.
EGR: We’re seeing prediction markets gain in popularity with customers in the US and jurisdictions challenge the legality of the platforms. What impact are event contracts having on Grandstand?
KM: Prediction markets are a positive new entrant to the market. We work with them in a variety of ways, mostly in terms of selling data to all those in the ecosystem who trade on prediction markets. Think market makers, quant funds, stuff like that. We’re watching it closely, just like everybody else, to see how this plays out long term. It seems like prediction markets are in a place where they aren’t going away anytime soon. It’s a positive new entrant for us and we’re going to take advantage of that.
EGR: You recently announced the launch of Rollcard, a “high-limit debit card for sports betting, casino and prediction markets”. Why have you decided to expand here and how accretive could this arm be?
KM: Ever since PASPA, payments have been probably the biggest friction in the market for US gaming. It’s something we’ve been looking at for a long time. This is the right time for us to do something about it. We are looking for ways we can develop the business. In terms of getting a product like Rollcard off the ground, we will be doing all types of marketing. Initially we will work with our own brands to help get that initial uplift.
The size of the opportunity is large; we’ve done a lot of modelling on it. There’s a lot of variances in terms of what the ultimate upside could be. What we’ve been saying is revenue opportunity in the next five years of $50m to $100m. Eventually it could get substantially larger than that. There’s lots of things we can add on to this as well. We want to provide value to our audience and to our partners. This sits right in the middle of that within our brand ecosystem and we feel pretty confident about it.
EGR: Grandstand has been active in M&A in the last few years, including acquisitions of Odds Holdings for $160m and Spotlight.Vegas in a deal worth up to $30m. Can we expect to see more movement on this front?
KM: We’re always interested in looking around and seeing if there’s something that makes sense. Right now, it would take something really interesting to get us to move on that. I suspect that’ll change at some point next year. Right now, we’re focused on managing cash flow and with that, M&A is more challenging. Obviously with where the share price is at as well, it doesn’t help us to do any deals, but we’re open to it. I wouldn’t say it’s the likeliest point in our history of doing actual deals at the moment.
EGR: How would you describe where the business is at today?
KM: The biggest thing is just how much the business has already changed. We’ve had to talk a lot about SEO because that was the bulk of the business for some time. Even marketing is a smaller piece of the business. SEO is about a third of our marketing business within that. The data is the most interesting piece in terms of growth at the moment and I suspect that’ll continue.
That’s very consistent, month over month, quarter over quarter business growth. We feel really good about where that’s at. We wanted to reset the business where it’s Grandstand and Rollcard and all these other things to better explain where we are today. We’re doing that but it’s going to take us time to keep delivering on all these things. We’re in a really good position. There are a lot of positive drivers within this business that are going to continue to grow.
The post Q&A: Grandstand CEO on being an AI-first organisation and affiliate’s “materially underpriced” share price first appeared on EGR Intel.
Kevin McCrystle tells EGR that the Nasdaq-listed firm is looking to deliver on expectations to improve its stock price and lifts the lid on the toughest decision he has made since becoming boss
The post Q&A: Grandstand CEO on being an AI-first organisation and affiliate’s “materially underpriced” share price first appeared on EGR Intel.