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Rivalry has raised $ 20 million for its sports betting and esports business. The company has a mobile and PC platform that makes it easy to place bets on sports and esports matches.
The average Rivalry customer is 25, and the company is targeting esports and sports enthusiasts under the age of 30. At the moment, Rivalry has an offshore gambling license with the Isle of Man, which allows it to facilitate gambling in places where there is no national license in place. Right now, that means it doesn’t work in the United States, but it’s working on getting licenses to do so, CEO Steven Salz said in an interview with GamesBeat. The most significant markets for the rivalry include Latin America, Russia, Southeast Asia, and Eastern Europe.
“We are an internationally regulated bookmaker and the business has grown 15% per month since we started,” said Salz. “We are looking to create products for a younger population. “
Investors in the oversubscribed round include institutional investors from Canada, the United States, the European Union and a major operator of land-based casinos. The Toronto-based company is yet to say who all of these investors are, and it sees this as a step towards an IPO later this year. Esports veterans Billy Levy and Zack Zeldin are both advisors and investors.
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With the new funds, Salz said the company will be able to accelerate its expansion plans through new licenses and gray markets under its current regulatory regime. It will also enable the development of new products and help the company deliver what it calls the safest and most engaging sports betting experience in the world.
Esport leads the way
While Rivalry began by focusing on esports betting, a growing percentage of its business is mainstream sports, including an upcoming sequel to original casino IP.
And Salz said that while it is difficult to make money in the nascent esports market, betting monetizes much better. So that means the business can profitably grow as the enthusiasm around esports itself grows.
“Esports hasn’t been an area where a lot of people have been able to monetize very well and build businesses,” said Billy Levy, an investor / advisor to Rivalry, in an interview with GamesBeat.
Esports companies raised $ 2 billion in 2020 out of 200 deals in 2020, up 116% in value from $ 957 million in 123 deals in 2019, according to mergers and acquisitions consultancy Quantum Tech Partners.
The challenge of running a gambling company is more regulation, and that is why the company is hoping to enter the US market through a sublicensing partnership with a land-based casino company, Salz said. Many of these casino companies are eager to partner up as their physical casinos are suffering from the pandemic. More and more states and Canada are moving towards legalization as a way to get more tax revenue.
“This capital helps us enter the US market,” Levy said. “And legalization is moving forward, very similar to the legalization of cannabis. “
Rivalry owns all of its intellectual property and does not use any white labels, which is a rarity in the world of sports betting and casinos. This approach provides full control over the user experience. Its plan is to become like the Robinhood of esports and sports betting, making betting easier and easier, just as Robinhood has done for stock trading.
The rivalry also has a media strategy. Its social and content properties generate more engagement than any other brand in sports betting, and the company is still only at the first stage of its vertical media roadmap, Salz said. Social media is essential for reaching the target audience, Salz said. Rivalry has 18 different social media properties in different languages, as well as several YouTube properties that generate over a million views per month.
“Content is… a way to reach audiences, but also a way to build branding and loyalty,” Salz said. “We sponsor over 120 different content creators, and often we are their sole sponsors.”
This content has gone viral and has significantly reduced the cost of acquiring new users, so the company is making money on all new users who sign up, Salz said. In contrast, other gambling companies have to spend a lot of money on advertising to reach the right users.
Salz said that Rivalry was launched in August 2018 and its business has grown 10-fold in 2020 compared to 2019. Growth in 2021 is so far more than 400% above growth rates of 2020.
The company has 60 employees. Rivalry is a subsidiary of Canadian parent company PMML, whose founders are Salz, Kevin Wimer, Ryan White and Steve Isenberg.
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