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Paddy Power Bets Big on the World’s First Sports Trading Exchange
By Jeff Osienya May 09, 2021 IndustryThe former director of communications of Paddy Power has debuted the first sports trading exchange website in the world. This startup plans to tap into the burgeoning US market and offer a richer and more interactive experience for sports fans.Paddy Power, the son of David Power, the co-founder of Paddy Power bookmarker – now a subsidiary of Flutter Entertainment, has launched the ‘world’s first sports trading exchange.’ The new venture is a fantasy sports betting company known as American Sportz Exchange (ASX). Mr. Paddy, along with his father’s Paddy Power sports betting company, has started a crowdfunding campaign to raise €500,000 for accelerating the startup’s growth.
The plan here is to integrate a fantasy sports scorecard with financial markets tech. Users will have a platform where they’ll access live ‘share prices’ of sports players and teams depending on how they (players and teams) are expected to perform on the pitch. ASX will be driven by an AI algorithm, and data will be fed into the system in real-time to update individual prices constantly. According to the ASX startup team, this approach will offer a richer and more dynamic engagement for fans when compared to traditional sports betting.
Users on ASX will then be buying and selling shares on the platform based on how they view the short-term or long-term performance of the players and teams. Trades will then be exited in a stock exchange-inspired fashion, and ASX will keep a tiny commission per trade. New players and teams will, of course, be introduced regularly onto the menu, and users will have three options to jump into the action: free-to-play, fantasy, and real money modes.
Backed By a Formidable Team of Industry Veterans
The innovative venture is steered by Mr. Power himself as the co-founder and president of the company, alongside other seasoned pros in sports betting and finance technology. For example, part of the management lineup includes Mike Griffin, the former commercial director of Racing Post, and Conall Flood, the former head of Efx Technology at Banco Santander.
Moreover, the fact that former Paddy Power staffers are also part of the team isn’t that much of a surprise. Mr. Power himself worked as the director of communications of his father’s Paddy Power company and has been part of the family business for a total of 24 years. He is currently a part-time brand ambassador of the Irish sports betting giant.
In the crowdfunding campaign, ASX is raising half a million Euros in exchange for 10% of the venture’s equity. There are, however, plans for a larger Series A fundraising in a year or a year and a half. The crowdfunding drive presently puts the company’s value at €4.5 million.
Interested parties can buy the shares exclusively via Spark CrowdFunding, the only equity crowdfunding platform in Ireland. Industry insiders expect the demand for the shares to be high as investors will have a 40% tax reduction on their investment for ASX as the startup qualifies for the Employee and Investment Incentive Scheme (EIIS) scheme.
Chris Burge, the Chief Executive Officer of Spark CrowdFunding CEO, said in a statement:
Quote“Few people know the industry as well as Paddy Power. He has worked in it for almost a quarter of a century. We’re so excited to be a part of helping his business get off the ground, as we think it will be huge. If I were a betting man, I’d tell people this is a good bet. But as Paddy says himself, stop betting and start investing.”
USA’s Growing Sports Betting Market is a Sweet Spot for ASX
As we speak, the website of the ASX startup is already up and running, but it is only accepting beta requests. And while the website is currently operating from Ireland, the main target is the US market. In recent interviews with local media houses, Mr. Power disclosed that he has already started holding discussions about exclusive deals with professional sports teams and broadcasters in North America.
Some of the teams that Mr. Power is courting include Golden Knights, the Las Vegas-based ice hockey team, the Phillies baseball team from Philadelphia, and the Toronto-based Blue Jays baseball team. For broadcasting platforms, Mr. Power, the president and co-founder of ASX, mentioned Sinclair Media, a prominent US broadcasting group, and DAZN, one of the fastest-growing video streaming platforms for sports.
No doubt, the USA has an incredibly lucrative market for sports betting companies. Shining a spotlight on New Jersey, the state saw annual revenue of $3.2 billion from online fantasy sports betting in 2020. Moreover, New Jersey was crowned king of sports betting in the country after collecting wagers worth over 6 billion last year. Mind you; the state only holds 2% of the entire country’s population. The larger US sports betting market, on the other hand, is projected to bring in up to over $8 billion in annual revenue by 2025.
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