In partnership with sportsbook platform supplier Amelco, RISQ specialist in betting insurance, risk management and liquidity solutions, has announced the launch of its ‘fixed % trading models’.
Allowing betting incumbents the option to operate markets on a fixed % of sports betting turnover over standard GGR models, SBC speaks to RISQ Chief Commercial Officer (CCO) Tom Mitchell on the benefits of % change and how RISQ and Amelco seek to ‘redefine operator-client sports betting partnerships’ …
SBC: Hi Tom, thanks for this interview. Can you breakdown for SBC Audiences your partnership with Amelco, which seeks to disrupt several key components related to modern sportsbook practices?
Tom Mitchell (Chief Commercial Officer – RISQ): Of course. Our partnership with Amelco allows them to offer their current and potential partners the option to remove the volatility of running a sportsbook.
In essence, sportsbook operators have winning periods and losing periods and we are able to help sportsbook platform providers remove the latter for their partners. Instead, we allow Amelco to give them a fixed-guarantee based on turnover and volume.
This allows sportsbook operators to concentrate on driving new player sign-ups, retaining punters and delivering a world-class experience to their customers.
SBC: Hitting industry headlines, your partnership seeks to deliver a new platform trading model based on ‘fixed %’ of wagering turnover’ over the ‘standard GGR models’, why is this such a radical change for incumbents?
TM: Sports betting is different from other gaming verticals in that the operator can have more extreme periods of profit and loss.
This volatility in revenue makes it difficult for sportsbooks to allocate spend for key factors such as marketing and advertising, product development and technical support. Our solution removes the volatility and provides a steady revenue stream.
This will be of particular benefit to online casino operators looking to launch sportsbooks as these companies are not used to such volatility. In fact, when most enquire about launching a sportsbook, they are surprised by the notion of a “losing month”.
Our solution combines our unrivalled expertise in trading, risk and insurance to make this more palatable for such operators and also for current sportsbook operators who are not comfortable with the standard GGR models.
It also offers upsides to sports betting platform providers as they no longer have the issue of their operator partners calling them up first thing Monday morning after a weekend of losses complaining that they got their pricing wrong, and allows them to grow their market by signing on operators who have previously shied away from Sports due to the volatility.
SBC: How does adjusting a bookmaker’s market % model, help bookmakers tackle scale complexities… why is having flexibility on % structures such an important asset?
TM: By taking away the uncertainty of whether they will be profitable or not, regardless of whether that is over a weekend, a month or a year. Our solution allows operators to plan marketing, acquisition and retention with a fixed budget. What is the benefit of this?
They can focus on driving growth which in turn will allow them to scale much quicker and then operate sustainably in the long term. For online casino operators looking to expand into sports betting, it provides a more manageable revenue and profit model.
SBC: RISQ competencies have focused on risk management and supplying liquidity, do you worry that Amelco partnership will be viewed as somewhat conflicting by industry stakeholders?
TM: Not at all…. as RISQ is not a platform technology provider. We are simply partnering with expert sportsbook platform providers and supporting their technologies and services with a non-risk solution for their operator partners.
Our experience with insurance combined with our trading and quant team allows us to offer a complimentary service to established platform providers looking to deliver the best possible product to their operator partners.
SBC: Beyond disrupting trading % models, where do you see this partnership developing further provisions for sportsbook operators?
TM: We are not just taking the risk away from online sportsbook operators; our trading team is also monitoring what platform providers are doing when it comes to markets and prices. It is in our interest to ensure they are pricing correctly, and we are aligned to help them deliver the best product they can.
For Amelco’s operator partners – and the operator partners of subsequent platform providers we work with – this means they can be certain they are receiving the absolute best odds and prices for their given markets. In essence, we are acting as a third eye and are helping to make ongoing improvements.
We also have plans to roll-out additional services and solutions and will be announcing more on that in the not too distant future.
Tom Mitchell – Chief Commercial Officer (CCO) – RISQ