New Sports gambling app Wagr aims to make betting social
Seven Seven Six Founder Alexis Ohanian joined Yahoo Finance with Mario Malave, the founder and CEO of Wagr, a new sports betting app.
Video Transcript
- The House always wins, or does it? Well, what if there was no House? Well, a new sports betting app called "Wagr," they are building what they call an inclusive social sports betting app, and they're announcing today a $4 million funding raise led by Alexis Ohanian, Seven Seven Six. And for that, we have Alexis Ohanian, Seven Seven Six founder, co-founder of Reddit as well, along with Mario Malavé. He is the Wagr CEO and founder. We'll get to the seed funding in a minute here, but this is a really interesting concept to me, because you take out the middleman kind of. I assume you collect a fee but not the House as it's traditionally presented, right?
MARIO MALAVE: That is correct. So since 2018, since sports betting was legalized in this country, there's been a multitude of options that have come out there in the market, but they all have three things in common. The first one is that they only pit you against the House, so the House only makes money when the user loses it. The second is that they're not particularly intuitive, so they're not very inclusive to new users. And the third one, which is a big misstep in the industry, is that they primarily have been catered and marketed to men, which we think is fundamentally a big mistake, so we're trying to change that. We're very energized to do so and trying to, as you said, build something more inclusive that anyone can use, all sports fans, not just gamblers.
- Alexis, what was it about Wagr that caught your attention?
ALEXIS OHANIAN: Well, candidly, I was just happy to get these friendly wagers out of my group chat and into a proper app, because I was tired of chasing down my friends for their Venmo payments when I beat them. I think a lot of people wagering, it's not a profession. I don't consider myself a gambler, but my friends and I really enjoy the thrill of talking trash and then backing it up with a few bucks. And it was funny. As someone who was pretty early in co-founding Reddit to social media and to the power of community, it was surprising to me that no one until Mario and his team had thought about how to make this into a truly social product, and it was pretty darn compelling.
- Yeah, this is one of those ideas that you immediately say, I wish I would have thought of that. Why didn't that exist already? But, Mario, could you give us some examples of the different types of wagers that could be made in this social context? I remember stories about Michael Jordan and Scottie Pippen, legendary betters and gamblers back in the day. They'd be sitting at a crowded airport, and they say, which of these two people is going to get over there the first? Bet $10,000 on it. Something like that maybe?
MARIO MALAVE: Initially, we're focusing on all major sports. And if you think about what we're building and it has some connotations of the marketplace, so we're being very intentional in slowly increasing the amounts of bets available on the platform. So from the get-go from launch, you'll be able to pretty much bet on the outcomes of games, so point spread bets as they're known in the industry, but fairly quickly, and we'll start rolling out all sorts of different options. So money lines, the ones that you just referred to, are typically called prop bets so anything about a game. Will Jordan score the next point? Will a certain hitter perform well at bat in the next iteration? And things that are closer to live betting, but we're starting simple and increasing the bet variety as we go.
- Alexis, I want to switch gears here just a little bit since we have you. Another one of obviously your very successful initiatives was the co-founder of Reddit. And I want to get your thoughts, because we've been talking so much about the rise of meme stocks and the rise of really the retail trader. Clearly, Reddit is at the center of all of this with some of those names like GameStop and AMC and Clover Health. The list goes on. I'm curious just to get your thoughts on this on the rise that we've seen over the last couple of months of the retail trader.
ALEXIS OHANIAN: Well, look. What you're seeing is a much larger trend here? It is the intersection of community and capital. It's the intersection of social media and finance. And 15 years ago, I was starting Reddit from my dorm room, and I don't even know how you would have executed a trade, maybe with an E-Trade account. I imagine there were still people picking up phones to do it back then. At the end of the day now, the user experience-- and that's the story of all this-- the user experience keeps getting better and better and better for consumers. And so naturally, consumers are going to gravitate towards things that are delightful, and then they also have things at their disposal they never did before, which is real time communication with their friends. Frankly, with even total strangers with whom they have friendships.
And so I really believe. I'm making big investments in this space, companies like Wagr, because I believe we're going to see in the next 10 years a whole nother architecture for finance that's built around community engagement. And whether it's wagering on a sporting event, whether it is buying or selling trading cards as easy as stocks, I'm actively looking to invest in these places, because I think what we're seeing on Wall Street with these quote unquote, "meme bets," it's not going away, right? More and more people are going to be coming online. More and more people are going to be engaging in everything from investing to wagering, and I'm excited to see more and more platforms that are building it intentionally. You heard Mario talk about this. This isn't for gamblers. This isn't for making sure the House wins. This is about giving everyone the opportunity to have a little fun, maybe talk a little trash, and win a few bucks from their friends, about something that's delightful. And that's actually shockingly different in a space that's normally been at times downright predatory.
- Alexis, I want to ask you about your Ethereum endorsement, which I believe you made a few days ago or recently.
ALEXIS OHANIAN: Yes.
- What do you think in cryptocurrency right now and also the DeFi space that interests you?
ALEXIS OHANIAN: I think I was lucky enough to be one of the earliest investors in Coinbase, like 7, 8, 9 years ago, so I've been in this space for a while. But I've really been impressed in the last two or three years with the amount of software, the amount of technology that's really getting built to facilitate. Whether it's decentralized finance, you talked about DeFi, or even collecting NFTs, virtual trading cards on Sorare for fantasy soccer, all of these technologies are showing off what the power of the blockchain can do. I think Ethereum is pretty special. I think you've got potential here for some programmable money, which means a lot of new technology can be built, but we're still in the earliest days of it. A company like Wagr is still built on fiat, but the nice thing is software makes that transition rather seamless. The most important thing to be doing now if you're building a new business is to be building it with software at its heart, because whether it is traditional fiat or whether it is cryptocurrency, you still got to at the end of the day do it on software, and that's where the big winners are going to be.
- Yeah, and programmable money. I kind of like that. You might want to trademark that. Alexis Ohanian, Seven Seven Six founder and co-founder of Reddit. Also, Mario Malavé, Wagr CEO and founder. Thank you for stopping by here.
