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“After going through hard times, you really appreciate when things are going well,” says Simplebet COO Mark Nerenberg.

Those hard times occurred in 2019, one year after Simplebet was founded with the grand ambition to innovate the user experience of sports betting.

“We made some missteps and we tried to do too much,” admits Nerenberg.

In the early days, the company grappled with its own identity and was conflicted between B2C and B2B. Was it a consumer sportsbook or a solutions provider? Doing both is never easy; doing both well is hard.

“I wouldn’t say we were a joke, but we had some respect to gain,” says Nerenberg, switching from frown to smile: “But now, everybody is locked in, and we have a chip on our shoulder to really prove everyone wrong.”

Back to basics

Fast forward to today and Simplebet is more sure of itself. The company eventually stayed true to its name and went back to basics, deciding to focus solely on microbetting.

For those who don’t know, microbetting allows consumers to place in-play bets on individual events during sports matches. Can you predict the outcome of the next pitch of a baseball? Well back that up with a bet.

Proponents say microbetting adds an extra layer of entertainment to the experience of watching live sport, over and above pre-match selections. It allows you to wager on the outcome in real time, and multiple times over, instead of having to wait for the final whistle.

The concept has gained notable traction over the last 12 to 18 months, especially with US operators, where the bet type is making up a higher percentage of bets than ever before.

It has also inspired the launch of the market’s first ever microbetting-focused B2C brand, but more on that later.

“I wouldn’t say we were a joke, but we had some respect to gain.”

At the start of Simplebet’s journey, microbetting was a much harder sell, according to Nerenberg. Despite the US market dripping with cash and investor appetite, the concept still received pushback early on, especially from experts in Europe.

“Industry veterans didn’t get it,” admits Nerenberg. He says this was because microbetting doesn’t work well on European sports like football (soccer), because there simply aren’t enough “micro” events or outcomes to get bettors excited.

Even tennis – which should be perfect considering there is a strike of the ball every other second – does not deliver a wide enough range of outcomes. The ball is either in or out.

This is where the more granular US sports, like American Football (NFL) and baseball (MLB), came to the fore and began to provide that all-important proof of concept for Simplebet.

Nerenberg insists that microbetting, in its purest form, is a product created to facilitate the predictions and opinions voiced by passionate US sports fans during every broadcast.

“It was not a new concept, but more of a new category that had massive potential that we could see but that others just weren’t seeing,” he adds.

Proof of concept

Now that others have woken up to that potential, they want their piece of the pie.

After showcasing a free version of its product with FanDuel, Simplebet secured a RMG deal with Intralot in Washington. This is what eventually attracted the attention of DraftKings, which became the firm’s first major customer back in August 2021.

That partnership has since gone from strength to strength, and is made even more solid by the fact Nerenberg worked at DraftKings for more than four years back in its DFS heyday.

For the latter part of the most recent MLB season, Simplebet accounted for 35% of DraftKings’ in-play GGR – a sizeable increase. “Before we started really pushing the envelope, micro timeframes were maybe between 2% and 5% of in-play volume,” Nerenberg explains.

As they say, the proof is in the pudding, and client contracts continued to roll in last year. In September, Simplebet secured a global partnership with bet365, while Caesars integrated the supplier’s microbetting technology in December.

“I think there was still some scepticism around us,” says Nerenberg. “But after six to 12 months of strong results with DraftKings, it has really started to pick up.”

A minute too late

The envy of every teenage rock band, Simplebet has seemingly achieved mainstream commercial success.

However, several challenges still spring to mind for the company and its future endeavours. The first issue – latency – is unescapable.

Microbetting is designed to allow sports fans to bet on live events as they happen. But unless fans are watching in the stadium, there will always be a delay on each broadcast.

Traditional TV coverage is usually seven to 10 seconds behind the live action, but that delay is a lot longer for online streaming providers.

A SuperBowl LVII survey conducted by integration provider Phenix found there was an average delay of nearly a minute between on-field play and pictures as seen by the viewer.

The delay on the NFL’s own streaming platform, NFL+, was recorded at 61 seconds, while Disney-owned Hulu was clocked at just over 69 seconds.

FuboTV, which once aspired to combine its sports streaming product with a US sportsbook, reported the longest delay among the measured providers at nearly 77 seconds.

Nerenberg acknowledges the problem but suggests there is enough of a gap between each micro event during both MLB and NFL matches to soften the impact on consumers.

It could also be argued that consumption trends for live sports are changing. Some sports fans might prefer to follow the action on their mobiles via live score apps, for example.

“A lot of sports fans in the US monitor box scores and play-by-plays on their phones anyway, whether they’re out watching the game or not,” says Nerenberg.

Simplebet has developed low-latency game tracker visualisations as a potential remedy, while Caesars has tapped Genius Sports for a low-latency Watch & Bet model, becoming the first US sportsbook to live stream NFL matches on both mobile and tablet devices.

“I think it’s a little underrated how much people will follow those and get the same level of enjoyment, but I know that watching the game is the most popular,” says Nerenberg.

Roll the dice

Offering people “instant gratification” with the chance to bet on every occurrence in a sports match also brings with it reservations around responsible gambling.

When asked directly whether microbetting should be considered the “casinofication of sports betting”, Nerenberg shakes his head in disagreement.

“There is a lot more skill and thought that can go into it,” he says, suggesting it should instead be viewed as added entertainment for fans that are already engaged with what they are watching.

That is not to say that microbetting has snubbed every fundamental of online casino, which is almost always viewed as the riskier vertical in the eyes of most regulators.

“One element taken from iGaming is the short feedback loop,” explains Nerenberg. “But really, that is the way that all consumer trends are heading anyway.” And who can really argue, with TikTok well on its way to world domination?

Betr the devil you know

It is impossible to discuss microbetting without bringing up Betr, the US B2C sports betting brand launched by Simplebet co-founder Joey Levy and online influencer Jake Paul.

The pair are a “match made in heaven”, according to Nerenberg, who reveals that Levy was always incredibly passionate about creating a direct-to-consumer play, despite the fact that opportunity for Simplebet “very clearly” lay in B2B, in his opinion.

Levy, who is a Thiel Foundation fellow, co-founded Simplebet to simplify betting for mass market sports fans. This is what inspired the firm’s first microbetting product.

While surfing a tidal wave of media coverage last summer, Levy predicted that microbetting would ultimately emerge as the predominant way to bet on US sports.

He also described the launch of Betr as an opportunity “to build the most capital efficient and culturally relevant gambling business in the US”.

The brand has so far only launched in Ohio, where it amassed roughly 0.1% of opening month market share for both handle and GGR after offering a $50 sign-up bonus.

“One element taken from iGaming is the short feedback loop. But really, that is the way that all consumer trends are heading anyway.”

It was always going to be difficult for Betr to compete with the likes of FanDuel and DraftKings and by Levy’s own admission, that is not a battle they are intending to fight.

FanDuel and DraftKings spent a combined $255m on promos in Ohio’s first month to carve out early market share of 50% and 27% respectively, so Betr must stand out in different ways.

One of those ways is through product, which is almost 100% powered by Simplebet, except for the operator’s player account management platform. There was just seven months between Betr’s launch announcement and its Ohio go-live date, which Nerenberg is proud of: “I haven’t heard of anything faster than that,” he says.

Eilers & Krejcik Gaming (EKG) said Betr’s UX and in-app speeds received positive scores from their testing team, as did the app’s aesthetics, layout, and design. However, researchers went on to describe the microbetting app as “vacant” due to its “barren” feature set.

Betr has already moved to address this by adding game outcomes and core pre-match markets to its product in time for March Madness, which once again are built by Simplebet.

Building back Betr

This freedom to create and build is exactly what excites Nerenberg, who was almost exclusively a product executive before becoming Simplebet COO last May.

In fact, part of the reason he left DraftKings in the first place was because the company was getting too big, and in his own words, he was “hungry” for another start-up.

DraftKings was about to go through a prolonged period of execution and regulation after going public while using Kambi as a third-party sportsbook supplier.

This is not what gets Nerenberg out of bed in the morning. After meeting Levy for the first time in 2018, he made a drastic decision: “I texted my wife to say I’m joining this kid’s company. Joey was like 24 at the time, but we just hit it off and I wanted to innovate.”

“Our other customers have a lot of other priorities,” he says in a nod to DraftKings. “But we’re an innovation company and we like coming out with new things. Instead of having to convince our customers to use it, we know we can get it out there and improve it with Betr.

“I think all of our customers are going to benefit from us having that in the long run.”

A simple plan

Indeed, the “long run” is our final topic of conversation. Simplebet is now five years old, and the US sports betting landscape has shifted several times over in that time.

Operators are no longer desperate to bring technology in house, while third-party suppliers are back in demand as they can help to keep costs down during a time where profit is the be all and end all.

So what is the exit plan for Simplebet? Nerenberg, and Simplebet co-founders Levy and CEO Chris Bevilacqua, have skin in the game, so this must be something they have considered?

“We have to look at this like we’re going at it for a decade,” he says, toeing the party line before becoming more candid and pondering the possibility of an IPO.

“Realistically, I could see a lot of scenarios where we merge or get acquired. It’s not happening anytime soon. I mean you never know, but there’s nothing looming.”

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