Few people have such extensive experience within the Fantasy Sports and sports betting space as Rob Phythian. With SharpLink, Rob’s vision is to change the sports betting space through innovation and conversion-focused, AI-driven sports betting technology, which sounds – and is – rather fascinating. We got the chance to ask Rob a few questions about SharpLink and their U.S. plans in 2021 and beyond.
About Rob Phythian
Rob founded SharpLink Gaming in 2019 and has served as President and CEO since. He is a board member of SportsHub Games Network, Inc., co-founder of sports content provider Sports Data which was acquired by Sportradar in 2013, and founder of fanball.com which he sold to London-based FUN Technologies in 2015. As a result of his contribution to the Fantasy Sports industry, Rob was elected to the Fantasy Sports Hall of Fame by the Fantasy Sports Trade Association in 2014.
What is SharpLink?
Phythian. SharpLink is a leading online sports technology company that connects sports fans, leagues and sports websites to relevant and timely sports betting content. We provide our customers with the technology and the tools to expose their users to the world of sports betting through free-to-play games and relevant, personalized bet offers. It is through this technology and tools that our customers can begin to monetize their audiences through better conversion.
What is the problem you see in the sports betting market that will be filled by this technology?
Phythian. The biggest problem in the market is that digital advertising is both expensive and highly ineffective in converting audiences. We see three key factors exacerbating this problem. First, it’s ironic that while the M&A craze in the market is so clearly focused on platforms acquiring new users and building market share, there isn’t more of a sophisticated push to convert these audiences into actual sports bettors. Building awareness and engaging users are nice. But, without the right conversion approaches, there is little guarantee that these audiences will make real deposits or bets.
Second, sports media, publishers, leagues, teams and sportsbooks focus too much of their energies (and budgets) on generic banner ads and buttons that just often don’t work. The fact is that ROI from banner ads and buttons are at historic lows and that’s because many of them look and feel the same, offering similar bet boosts and free cash promotions that don’t motivate users to act.
Lastly, it’s difficult to create solutions that truly work because many of the platforms in the sports betting industry are built and managed on the backend by European technology companies. While these European companies have decades of experience in the sports betting space, it doesn’t mean that what works there, will work here. Outsourcing this critical technology overseas also limits how an entity can innovate quickly or differentiate from the pack.
You recently finalized a reverse merger and are now a public company. Why was going public important to your growth strategy?
Phythian. The American sports betting market may be in its infancy, but it isn’t slowing down anytime soon. With 23 states and Washington, D.C. now having legalized sports betting, that represents an audience of 40% of the US population – however, only 26% has access to online betting so far. That represents an enormous market opportunity for SharpLink.
By becoming a Nasdaq-listed company, we have access to growth capital which will allow us to effectively help to define, scale and innovate the emerging U.S. sports betting conversion market. Unlike other sports betting companies which are handcuffed by their outsourced technology, we own and develop our own technology stack. We can raise capital to invest in our technology, recruit talent and pursue attractive acquisition targets, collectively allowing us to strengthen our leadership in the market.
Tell us about SharpLink’s proprietary C4 technology. Do you have any examples of its application with clients?
Phythian. C4 is our proprietary AI-enabled behavioral modeling technology that connects users with real-time personalized betting offers. C4 stands for Collect, Connect, Convert and Capitalize.
C4 enables sports media publishers, leagues and teams to capitalize on opportunities to exponentially scale their sports betting revenue channels by collecting and analyzing behavioral insights on their online users. Our C4 platform replaces generic banner ads and buttons and produces significantly higher conversion rates of sports fans to sports bettors at significantly lower costs. This is the core value proposition for our current and future clients – and it is the key for driving potentially exponential market adoption of our technology solutions by the U.S. sports betting market as it matures.
A fantastic example of our C4 technology at work is our long-standing relationship with NASCAR. SharpLink creates free-to-play games for NASCAR.com. These games allow NASCAR fans to interact with the league on a deeper level as well as provides these users to acclimate to the emerging U.S. sports betting industry. The results of the integration have been impressive. NASCAR is thrilled with the user engagement we are creating for them and their sportsbook partners at BetMGM are excited by the downstream effect that these games have in providing users with real-time information on bets that they could make based off of their user behaviors. We feel that our C4 product really lifts all boats, creating a win-win scenario for our customers.
While the sports betting industry in America is in its infancy, you’re a seasoned vet who has built and sold a number of sports information and technology companies that have helped set the foundation for the sports betting and fantasy market. Can you walk us through your entrepreneurial journey leading up to the founding of SharpLink?
Phythian. My first venture into business-building began with a company I co-founded in 1993 called Fanball, an online fantasy sports site and publisher of the world’s first weekly fantasy sports magazine, Fantasy Football Weekly. In its very first week on newsstands, our little newsprint magazine outsold People Magazine and TV Guide in the stores where it was placed. We knew then that we were onto something big.
During the late 1990’s, the Internet became a perfect match for fantasy sports and we went on to strike major deals with sports leagues and publishers, including Turner Sports Interactive, AOL, NASCAR and the PGA TOUR. Fanball ultimately grew into the largest fantasy sports pure play website on the Internet.
My partner and I sold Fanball in 2005 to London-based, publicly traded FUN Technologies. FUN was one of the world’s largest providers of online and interactive casual and fantasy sports games and sports information at that time.
Following the sale, I stayed on board at FUN for two years as president of its sports division, managing our portfolio of sports companies, including Fanball, Don Best, Fantasy Cup and CDM Sports. In 2007, FUN was acquired in an all-cash transaction by John Malone’s Liberty Media Corporation.
In 2010, I went on to co-found SportsData to provide real-time game statistics that powered scoreboards and fantasy sports games to the underserved US digital market. Early in development, I was able to sign Google, Facebook and Turner Sports to data licensing deals. Just three years later, we sold SportsData to Swiss firm Sportradar, a multinational company that collects and analyzes sports data.
I spent the next two years at Sportradar’s U.S. division, where I helped win, cultivate and manage key client relationships with the likes of NBC Sports, CBS Sports and the NFL, among other prolific sports leagues and media companies.
In 2015, the entrepreneurial bug bit again, fueled by my belief that the fantasy sports gaming market was ripe for consolidation. So that year I founded SportsHub Technologies, and went on to acquire six businesses, including Sports Technologies, WhatIfSports, LeagueSafe, National Fantasy Championships and CDM Sports, which brought Fanball back to where it all started.
Today, SportsHub has matured into one of the industry’s most trusted providers of popular daily fantasy sports games and cash-paying contests with a loyal audience of over one million sports fans.
I have stepped down as SportsHub’s CEO to focus on what I – and many others – believe is the sports gaming industry’s most explosive growth opportunity yet — U.S. online sports betting and cost-effectively enabling sports fans to be converted into sports bettors.
What’s next on the horizon for SharpLink?
Phythian. With industry experts predicting that the United States will ultimately grow to be the largest online sports betting market in the world by 2025, it is incumbent upon SharpLink to successfully leverage our powerful C4 Sports Betting Conversion Platform, empowering sports media publishers and professional sports leagues to transform their websites into fully-transactional online betting destinations in states where online sports betting has been legalized.
C4 helps sports entities with large audiences convert passionate sports fans into new sports bettors; and positions us for multiple revenue streams including – upon state licensing and platform adoption by our customers and sportsbooks – the opportunity for a percentage of the net gaming revenue generated by a bettor introduced through our intelligent conversion technology. Ultimately, we believe we can dominate the U.S. online sports betting by making sports betting easy.