Simplebet CEO on the state of play in the U.S. sports betting market

Chris Bevilacqua , Simplebet CEO, joined Yahoo Finance to discuss the outlook for sports betting.

Video Transcript

ADAM SHAPIRO: Let's turn our attention to the future of sports betting and micro betting. We welcome back into the stream, Chris Bevilacqua. He is the CEO from SimpleBet. Chris, it's good to have you here. And one of the things that I talked with another guest recently is something you've pointed out that when you're watching a sporting event, [INAUDIBLE] the viewer the chance to bet on it in real-time, I'm going to stick around much longer [INAUDIBLE]

CHRIS BEVILACQUA: Yeah, study after study. And it will show that when people have money on a game, right, they are invested and engaged, and they'll watch longer. And our products, right, micro marketing-- micro market products where you can bet on real-time in the middle of games on every single incident occurring during the game is a very highly engaging, entertaining way to increase your consumption of sports.

SEANA SMITH: Chris, at a time like this, how critical is it for fan engagement when we don't have fans in the stands in a lot of places, or in some locations, it's limited capacity. How critical is it at a time like this when there aren't those options that would be typically available for fans in a normal year?

CHRIS BEVILACQUA: Yeah, that's a great question. And I think you're going to see quite a bit of just product innovation with technology and products that bring people that aren't inside of stadiums and arenas much closer to the action. And so, yeah, in a time like this, where a pandemic is keeping people out of gathering en masse, right, these are-- this allows teams and leagues and media companies to get closer to the fan, or very close to the fan without actually physically being present. So it is really a useful tool in that it keeps people and fans connected to the product.

SEANA SMITH: Chris, when you talk about play betting, how big of a piece of the pie do you see this being when it comes to the overall sports betting market? What's the growth trajectory here?

CHRIS BEVILACQUA: Yeah, I mean, if you look out-- I see you have on the screen here just in terms of forecasting revenue, and I've seen numbers that go a lot higher than $8 billion by the time 2025. But if you look at the European markets, and you'll see that the term in play, right, which are bets that occur throughout a game when it's live-- it's money lines, and over under is an outcome-based bets-- that's about 70% of the handle.

And we see here in the US something similar will happen over time and, in fact, probably faster than most people think, that a large portion of in play will be these actual micro market bets, where you can bet on every bat or every at bat or every pitch in a baseball game, or every player, every drive in a football game. And, you know, if you look at the TAM, the Total Addressable Market, all the way out at $10, $15 billion, we think a predominant way that sports betting will be in the future will be through micro market betting. So, in and of itself, we see it as a multibillion dollar TAM opportunity for micro betting.

SEANA SMITH: Chris, I know you unveiled your product for the NFL season this past season, the 2020 season. What was engagement like? And what did you learn just in terms of what the fans like to bet on, what they didn't like to bet on, when you talk about rolling it out to some of the other leagues, going forward?

CHRIS BEVILACQUA: Yeah, so you're-- so we had our product on Fanduel up for the entire NFL season. It was called Play Action, where you could bet on every play and every drive. It was a free to play game, but you could win cash prizes. And so by the week 17, the last week of the season, we had the average user betting 80.1 times on Sunday. And about 63% of them were betting on multiple games throughout the Sunday slate. About 25% or 25% of all the users on the FanDuel app were on the app for an hour or more. And about 11% or 12% were on the app for about two hours or more.

So, really sticky, very highly entertaining, very sticky behavior. We saw a lot of behavior, a lot of betting around positive outcome bets. Like, so users betting on field goal or touchdown, not negative outcome based bets. So a lot of, you know, I think, really interesting data that we captured over the first football season.

ADAM SHAPIRO: The question I asked the other guest I want to ask you, too, so this data that you collect, we know there's the direct to direct, are you going to place a bet on this micro betting product. But how I respond to that and what I choose to perhaps wager upon becomes valuable in and of itself. Do you monetize that and then package for those who might be willing to buy?

CHRIS BEVILACQUA: Yeah, so we're a B2B-- so we're on Enterprise software. So we actually license that automation and those types of bets to the consumer facing operator. In this case, it's Fanduel. And Fanduel has a direct relationship with the customer, and therefore, they're the ones that collect the customer-- you know, their usernames and passwords and IDs.

We get the behavioral data. So we know what kinds of bets people are making, how long they're on there. You know, the down and yardage type information that we get when a user makes that type of bet. So we collect more of the user data, not the specific data that is collected by the sportsbook themselves.

ADAM SHAPIRO: Chris, I had some technical issues. So I missed part of the responses you had with Seana, but I was curious, is there a potential for growth outside of sports? You would do it through the Fanduel's and those kinds of venues. But for instance, the political seasons, people, I'm sure, would love to take bets during debates and those kinds of issues. Could it expand to that, especially with the real-time capability that your software provides?

CHRIS BEVILACQUA: Yeah, I mean, listen, I always say to our team that focus, focus, focus. We got to eat the elephant one bite at a time. But in this-- you know, as you look at anywhere where you have a vast amount of data and you have a live data feed and incident information, you could create similar type products. And so, like you just described, Adam, the political elections and things that move, you know, en masse like that, are surely longer term opportunities, but we're going to stay focused on sports for the near term.

ADAM SHAPIRO: All right, Chris Bevilacqua is not only the CEO of SimpleBet, he's got the best live background of anybody who's been in the street on any network in the past couple of years. Chris, all the best to you. Thank--