Company Successes And The Role Of Machine Learning For Future Growth
Richard Carter, CEO, SBTech.
Can you describe briefly your past work experience in the industry of sports betting?
I’m in my third year as chief executive and have enjoyed every minute of the journey so far. I’ve been very fortunate to have overseen the company’s most successful growth period, and I’m confident we can continue that momentum as we expand into the emerging US market and other global markets. Before joining SBTech in early 2016 I spent many years as working as a gaming and leisure analyst in the City of London for Deutsche Bank with a major focus on the UK and European sports betting companies and was fortunate to be at the coal face analysing and witnessing the evolution from a largely land based business model to an increasingly online focused strategy.
What attracted you to the position of CEO of SBTech?
Having worked very closely with the industry, I witnessed SBTech’s growing reputation and track record, I liked the culture, the people, the product offering of sports, the fact that SBTech’s technology was highly scalable and built on the principles of SAAS, and so, after a very short discussion, it was a very easy decision to join as CEO.
Since then we have worked extremely hard on building on that early success by significantly investing in the core technology platform, deepening and widening the product offering and developing new, cutting-edge features and functionality to help our partners grow incremental revenue and market share. At the core of what we do is our highly modular technology backbone which allows us to deliver increasingly large and complex projects in multiple regulated regimes and maintain the rapid growth that we have experienced as a result of our efforts. The outlook continues to be very exciting, as dynamics for sports betting, globally, remain very compelling.
In what areas of sports betting do you see the most benefits for development?
For SBTech, enhancing our machine learning capabilities will be a key focus as it can be used to drive improvements to players’ experiences as well as to refine and upgrade our trading models and tools.
This all begins with a very strong automated profiling system for customers across both trading and CRM parameters including; churn risk, prediction of most relevant events/bets and for a player at a certain time, potential VIPs, as well as all the regular trading profiles around sharp punters, those with faster feeds, knowledge on specific sports. Most operators or providers will have these segments, but the trick is having this in one clean data set, and one view of the player. Once this is achieved you can overlay a deep learning algorithm that will push data about the player to the relevant modules and applications, (trading tools, models, CRM, bonusing, various user interfaces that can be personalised) and pick up what comes back based on player behaviour and update the data set and algorithm accordingly. So, making gains in what we do with our big data and deep learning will give SBTech gains in almost every area of our solution; therefore it is a key focus for us.
Naturally, to gain this edge you need the technology to be able to push data instantly, ensuring these gains are realised. SBTech uses RabbitMq and Kafka for our messaging and real-time data pipelines to ensure we are able to instantly receive the benefits from our machine learning algorithms when needed and to maximise the value. We are all about defining what our operators need, what end users want, and then selecting the right technology to meet those wants and needs in the fastest, most scalable and best performing way. This is no easy task when dealing with the volume of data we gather and process. Therefore, SBTech’s continued investment into our deep learning algorithms will be tightly coupled with more investment in our technology and research and development in order to build on our already market leading solution.
What are the key challenges SBTech sees at present?
The new paradigm of rising and more complex operating regulations; for example, increasing restrictions on advertising, is just one the many recent changes the industry is having to absorb and manage, and is one of the key challenges that is likely to grow as we move forward. However, complex and tighter regulations is nothing new to SBTech given we operate in more regulated markets than many of our peers, and we view the trend towards tighter and more complex regulations as more of a medium-term opportunity than a risk, as it raises the barriers to entry and the barriers to success. This, in turn, puts more emphasis and responsibility on suppliers like SBTech to regularly increase service levels which, given our ever-increasing investment in leading product features, intelligent personalisation and pricing innovations, will enable our partners to outperform the competition.
Retaining, investing and growing our people is also a key focus area for SBTech. Our people are the drivers of our long-term future success and, as we all know, competition for top talent in the technology sector is unrelenting.
Are the current laws and regulations which have been implemented and somehow forced on software providers helping business or are they slowing it down?
We always welcome regulation and set ourselves the highest standards possible in ensuring our entire offering, and that of our customers, adheres to every rule and regulation no matter where we work in the world. As an industry we must all act and operate responsibly and this begins with technology suppliers such as ourselves.
Our role as a leading industry supplier has helped us understand that compliance is no longer just a mandatory requirement, it is a mindset at the heart of the operator’s business model, and one that can significantly benefit both social responsibility and sustainable commercial growth.
Central to this is the convergence of technology and mindset. As an industry we have pioneered the use of highly innovative marketing technology, and we continue to do so today, with data-driven platforms and functionality able to segment and target players down to an individual level based on specific behaviours.
Instead of regulation and marketing competing, however we believe they should complete one another with operators and suppliers using the same cutting-edge technology to offer players safety, fairness and entertainment.
Our current efforts are guided by our ambition to continue to lead the way in providing customers with the most innovative software solutions to not only support their regulated operations, but to also help them to put social responsibility at the heart of their business model, shifting the mindset from considering compliance as a blocker to it becoming an enabler to business growth.
How do you perceive the company’s position in the United States?
The US sports betting market only went live in September 2018 and is therefore still very young, however we have already made significant in-roads there establishing several strategic partnerships in New Jersey and Mississippi and have many in the pipeline. The potential is clearly huge, and we are investing significantly in our technology and our infrastructure on the ground to enable us to maximise this long-term opportunity, and I am delighted that Gavin Isaacs, with his extensive knowledge of the US market has agreed to join us as non-executive chairman; his support and contacts will prove invaluable.
What does 2019 have in store for SBTech?
Our main goal is to ensure we continue to scale and increase the trajectory of delivery and success for our partners and continue to lead the industry in product innovation, driven by a strategy of evolution with regular, highly targeted improvements across all key consumer touch points.
Areas of key focus over the next 12 months will be to further develop and deepen our machine learning, and data-driven intelligent personalisation algorithms, to enable our operators to increase the accuracy of predicting and shaping player behavior in real-time, thereby helping to maximise conversion at every stage of the player journey. We will also deploy our next generation APIs to allow our partners more flexibility, differentiation and control.
We are also constantly analyzing and considering new markets. In the near term we are focused on entering the French sports betting market with several partners, as well as South Africa and Spain as a platform provider, with several more planned for later this year, in addition to multiple US states. We will also take a close look at Latam as the regulatory environment evolves.