Strategy

Q&A: Genius Sports CEO Mark Locke on post-acquisition plans and US ambitions

EGR sits down with Locke following the successful closure of the provider's acquisition by private equity firm Apax

Genius Sports today closed the deal that will see the provider acquired by private equity giant ApaxEGR sat down with Genius Sports CEO, Mark Locke, to discuss the deal and the firm’s ambitions for the US market.

Q: Tell us about how the Apax deal came about and why they were the best partner to support the company’s goals.

A: Apax Partners is amongst the largest private equity firms in the world with an amazing track record in the technology sector. But even more importantly, their team really understands both our strategic vision, and our values, which means working with integrity, intelligence and innovation.

There was strong interest from several other parties, including within the gaming sector, however once we began talks with Apax it became obvious that their understanding of our business and the sectors we operate in, along with the expertise and financial resources, made them the perfect partner for long-term growth.

Q: What sort of acquisitions will you be targeting with their backing?

A: We are looking for partners that have a good technology base and are driving growth in the sector they’re working in. A great example of that within the sports sector is last year’s acquisition of DataProject, a company whose technology is used by over 80% of volleyball leagues worldwide. Since the acquisition, the synergies between the two businesses have driven rapid growth of our combined volleyball client base across the world. Crucially, this gives us access to the highest quality, official data for one of the fastest-growing betting sports, in turn benefiting our vast network of regulated betting operators. That has been a hugely successful model and one which we may look to repeat in other sports.

Q: Long-term, do you think the US product looks different to current European sportsbooks?

A: There will be cultural differences. The gamification and simplification of sports betting, in order to bring it to a wider and more varied audience, will be a big focus. There are huge opportunities around augmenting the live viewing experience with betting products that bring the game to life for the casual customer and that is part of our vision. With in-game betting still in its infancy in the US, operators have a chance to bring something unique to the market and not simply rely on the European model.

The other area that’s interesting is around different types of data being used for betting purposes. Player tracking technology, as well as software that captures and processes biometric data, is evolving incredibly fast and will open up enormous scope to build betting products using that data. Whether it’s how high a player jumps, how fast they run, or which player covers the most ground during a game, these have the potential to become interesting bet types. We are investing heavily in areas that will allow us to provide products like that in future.

Q: Some US analysts have suggested that current European trading models simply aren’t up to scratch on US sports, particularly for in-play betting. Is that fair?

A: That sounds like a challenge! Fundamentally it comes down to quality of data, product and the expertise of the business creating the prices.

Take basketball for example. We already have the sharpest pricing and models in the market today, and that has produced some amazing results for our partners. With 15 years’ experience in trading, we back ourselves to repeat that success across all US sports to create robust models that drive profits.

The investment we are putting into our US product is significant. Is anyone where they need to be at the moment for US sports? Probably not, but we’re going to get there fastest.

Q: We’ve seen several platform deals announced in the market. Are you concerned that Betgenius isn’t among them?

A: We are very comfortable with how we’re placed for long-term success in the US market. We have of course been involved in conversations with licensees where the focus on the operator side has been speed to market and so it made sense for them to partner with a more whitelabel-style sportsbook supplier. We are predominantly interested in sustainable growth and will pursue deals with operators that have an eye on long-term differentiation across brand and product, which is what our technology is built to facilitate.

Some of the deals that have been done early will no doubt be a roaring success. But history tells us that some definitely won’t be. I’m not particularly concerned about first-mover advantage – in the UK, Sky Bet came in after the market was already well established but had fresh brand, great UX and an innovative marketing model that has powered long-term success.

The full interview with Locke will appear in next month’s issue of EGR North America 

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