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Kero Gaming founder and CEO Tomash Devenishek has challenged the prevailing notion within the sports betting industry that betting is an entertainment product.

However, he believes that Kero Gaming’s AI-powered micro-betting platform could revolutionise the industry through personalised in-game micro-betting experiences, and a patent pending single model pricing system which leverages generative AI for oddsmaking simulations.

Too complicated

“In the industry, a lot of people talk about sports betting as entertainment, but it’s really not,” Devenishek said at a recent Yolo Partners event in Tallinn, Estonia.

“Sports betting today is highly cognitive and testing. You have to think, you have to browse, calculate probabilities, and eventually find that one thing that you want to bet on.

“Twitter and Instagram are not like that. Because all you have to do is just scroll your thumb and things appear,” he said.

Devenishek went on: “So, for betting to become an entertainment product we have to integrate the principles commonly found in mainstream digital entertainment products.”

By emulating the social and instant gratification elements characteristic of popular social media platforms like Twitter and Instagram, he said, Kero Sports aims to transform sports betting into a more seamless and enjoyable experience.

Attracting investment

Founded in 2019, Kero Sports has garnered attention as one of the hottest start-ups in the iGaming industry.

The company has attracted investment from both Robin Reed’s HappyHour.io and Tim Heath’s Yolo Investments.

Using real-time play-by-play data and advanced AI algorithms, Kero recommends to users engaging betting markets to place bets effortlessly every 15 to 30 seconds, eliminating the need for extensive browsing and calculations that are typical of traditional sports betting.

Making it personal

Looking ahead, Kero Sports is not resting on its laurels. The company is currently working on incorporating personalisation into its platform.

By analysing users’ behavioural data, including their betting preferences and interests, Kero Sports intends to offer a tailored betting experience.

This will ensure that users are presented with a curated selection of markets that maximise their engagement.

“There are so many good markets that we are able to produce but we don’t want our customers to scroll. We don’t want to offer 600 different markets. We want it to be one that maximises the likelihood that one is betting,” he said.

The personalisation feature will be delivered through two methods: a full product that can be embedded as a web iframe or an SDK for casino-only clients, and an API that allows partners to inject real-time micro-markets into their existing platforms.

Single model pricing

Kero has also made an exciting announcement in the realm of generative AI.

The company recently filed a patent for a unique approach, which involves training generative AI models to generate coherent sequences of play-by-play events in sports games.

The company needed a solution to provide odds on highly complex micro markets, which do not lend themselves well to traditional oddsmaking methods.

A breakthrough was achieved by leveraging AI to simulate thousands of concurrent variations of matches, from which pricing for various betting opportunities can be computed.

“One of the key challenges that we as a company face is that most of our markets are unique.

“For a long time, this has been a constraint for us,” Devenishek said.

However, the rise of ChatGPT got him thinking: “Sports and sports games are kind of like a language, with a serious of events happening, such as corners, passes, crosses, counter attacks and goals,” he explained.  

Kero built a model – internally called BetGPT – that when prompted generates thousands of coherent  variations of a specific match. 

“Based on these results, we can easily price any micro/macro event within a match. The output was quite consistent with the dedicated multi-model approach we and the industry use.”

In conversation with iGaming NEXT, Devenishek said he believes in the future this will become the predominant “pricing method” for the industry.

Caleta Gaming, a fast-growing Brazilian games provider, attended the exclusive Yolo Partners Event 2023, hosted by Yolo Group. The event is reserved for Yolo Investments portfolio companies, as well as the Group’s partners. 

Caleta Gaming co-founders Paulo Nova and Fabiola Jaeger both attended the prestigious gathering.

Yolo Investments is a prominent venture capital firm focusing on the rapidly growing iGaming and fintech sectors, boasting an extensive portfolio of over 100 investments. 

Yolo Investments featured Caleta Gaming as one of the spotlight investments from its portfolio.

Julian Buhagiar, general partner at Yolo Investments, said: “We’re thrilled with the progress Caleta has made over the past 12 months, and it’s fantastic to host Fabiola and Paulo.

“Caleta has an unparalleled understanding of Latin America’s online casino market, and is now beginning to expand into other markets. Yolo Investments will be supporting them every step of the way.”

Fabiola Jaeger, co-founder and CEO of Caleta Gaming, added: “I couldn’t be happier. Our team has being working tirelessly to reach this milestone. Though we are already in a phase of expansion, we feel like we are just at the beginning of our journey.

“Our goals are ambitious, and I have no doubt we will achieve them with our exceptional team. Thank you, Yolo, for such amazing support!”

As Caleta Gaming continues to set new standards in the online casino space, the company remains committed to pushing the boundaries of creativity and innovation, offering players an exceptional gaming experience worldwide.

Yolo Group and Yolo Investments founder Tim Heath believes the regulatory situation in European gambling is stifling innovation and damaging the player experience.

Heath – who was an early adopter of Bitcoin and founded brands including Bitcasino.io and Sportsbet.io – took part in the opening panel of iGaming NEXT Valletta 23.

During the session, he delivered several industry-focused predictions for the coming year alongside happyhour.io co-founding partner Robin Reed.

The panel was moderated by iGaming NEXT MD Pierre Lindh, who asked Heath what he thought about increasingly strict gambling regulations being implemented across most European countries, from the Netherlands and Belgium to the UK and Ireland.

When faced with the hypothetical scenario of entering a European market with one million dollars of investment and a golden idea for an iGaming start-up, Heath was stumped.

“There are not many pre-regulated markets left in Europe at all,” he said. “There is Finland, kind of Norway, and not really anywhere else.

“I want to be able to come into a market as a small business with a million dollars and bring a grand idea into fruition and then grow that economy.

“But the regulations are so difficult. You need three forms of compliance just to stop yourself from being fined. How does that encourage innovation or growth?”

Operators in regulated markets have been forced to invest heavily in compliance for the best part of five years now.

Those that fall foul of compliance are faced with enforcement action and financial penalties.

For example, William Hill was hit with a £19.2m settlement by the UK Gambling Commission earlier this year, a record settlement in one of the continent’s most stringent markets.

On the mainland, the Netherlands Gaming Authority (KSA) has dished out major fines this year for the likes of Videoslots (€10m) for accepting Dutch players without a licence and for multiple companies including bet365 (€400k) for a breach of marketing restrictions.

“My job [as an operator] is to make the customer happy,” Heath continued. “If my customers are happy, I’m going to be alright for the long run.

“Regulation is not there to engage and promote and encourage new businesses coming through and I just don’t know where I would go in Europe at the moment.”

As well as increased compliance and safer gambling costs, Heath said the cost of working with both affiliates and payment service providers is much higher in mature markets, with some commanding “ridiculous fees” and commission of up to 10%.

“Guess where that [cost] comes off?” he asked. “It comes off the player experience.

“You run your book at 92% because you’ve got to pay for compliance, KYC, payments processing, and then you’re having to pay players in Germany and Austria.”

Heath was referring to the expensive upturn in historical player claims from markets such as Germany and Austria prior to local regulation.

On this topic, Malta has moved to protect MGA licensees with a controversial new law designed to block overseas prosecution.

Adding a final word on the situation in Europe, Heath said: “You are almost just having to defend yourself as opposed to focusing on the single focus of the customer experience.”

Earlier this month I was in London for ICE 2023. As usual, it was packed to the hilt. The scale of the event is testament to the burgeoning gaming industry.

But given the broader macro-climate, was it all just smoke and mirrors? Or are we a real canary in the coal mine?

Halfway through Q1 of 2023, one would be forgiven for thinking that the macro-climate and the access to funding and capital looks ominous for everyone. The borrowing costs set by the US Federal Reserve are a good barometer for global trends across the investing sector.

In November, the US Fed increased the target range for the federal funds rate by 0.75% to 3.75%-4%. Across the world, the cost of capital has continued to rise rapidly to combat high inflation. This impacts the spending and investment decisions made by all households and businesses.

Over the last year, we have seen the SPAC market largely fizzle out, reducing the likelihood of large-scale M&A unless the acquiring business has significant cash on the balance sheet.

When opportunity presents itself

For VCs however, the outlook looks more optimistic — especially in the gaming space when viewed as a portal into web3. While outside money for regulated gaming ventures is becoming more difficult to source, some investors certainly have dry powder ready to deploy when the time is right.

What does that mean in practice? Firstly, all parties are waiting for valuations to come back down to more realistic levels. For more speculative or early-stage companies or those chasing growth markets like the US and Asia, there’s been a significant decline in fast-moving investors, and probably for the good.

Two years ago, most VCs were imbued with a severe fear of missing out. Today, they are looking for fewer, more targeted opportunities, with most re-trenching to what suits “their fit”. But this is no different to other industries, including software firms who are used to easier money.

Yolo Investments general partner Tim Heath: “This downturn is healthy in the sense that the fundamentals were being ignored for too long. I am optimistic that the strong will survive and thrive.”

However at Yolo we’re confident there is an opportunity gap in this sector at the Seed to Series A level, to provide active growth capital to ventures with a proven business model who would benefit from a long-term partner to provide ecosystem support.

We especially think that firms able to bundle their gaming and entertainment offer into broader web3 services, such as banking and education, have a greater chance of success in this market. Jambo, an African web3 and fintech firm in whose recent $30m Series A round we participated, is a great example.

The company will use the funding to hire the engineers needed to build a web3 super app that will enable Africans to trade crypto, buy and sell NFTs, experience play-to-earn crypto games, bank themselves and access educational web3 applications.

Companies like this, bringing real value to growth markets, will not just survive the crypto and VC winters — overhyped though these seasons are — but thrive into the long-term.

End of the road

On the healthy side, I think a lot of the products and companies that are genuinely overhyped have seen their day over the past year, and we’re not likely to see more of them.

Without naming names, these are companies that used to raise easy money only to go on to become the fiftieth entrant to saturated markets — probably only attaining 2–3% market share. Their kind won’t be seeing the light of day again for a long period of time.

The strong use cases on the other hand will only get stronger. Social gaming, for example, has an extraordinary ability to leverage the network effects of traditional social media (Facebook, Twitter, etc.), and will only get more competitive in 2023.

Long-term value

I fundamentally believe in the long-term value proposition of the gaming sector. Games provide a form of escapism, immediate gratification, engaging content, and can provide a crucial portal into life changing applications in education and payments.

This downturn is healthy in the sense that the fundamentals were being ignored for too long. I am optimistic that the strong will survive and thrive, and we will be a more successful industry for it.

In short, there is a wealth of talent out there building innovative products so it would be wrong to say they are all overhyped. Like life, sourcing funding is often a matter of luck and good timing.

Some products might be great solutions in their own right — but their true value won’t be appreciated by investors intent on developing ecosystems that don’t cater to their unique place in the market.

The message is — don’t give up. For those who can stay the course through 2023, great things might still come to those who wait. See you all at ICE 2024.

This post first appeared on Medium.com.

Tim Heath draws upon two decades of experience within the iGaming and emerging technologies sectors as GP of Yolo Investments. An early adopter of Bitcoin in 2013, he was founder and CEO of the Yolo Group (formerly the Coingaming Group) until 2020. The group operates leading crypto gaming brands Bitcasino and Sportsbet.io, with the latter securing high-profile sponsorships with Premier League clubs Arsenal and Southampton.

iGaming NEXT is proud to announce the launch of its new state-of-the-art podcast studio in Malta.

The studio was created in collaboration with Yolo Investments, which enabled the build by supporting the company on this initiative.

The studio, which is equipped with the latest audio and video technology, will be used to produce high-quality podcasts for the iGaming industry.

In addition to producing its own in-house podcasts, the studio will also be available to rent for external partners to work on their own media productions.

The studio is suitable for a wide range of media projects, including podcasts, webinars and video interviews.

The launch of the podcast studio is a significant milestone for iGaming NEXT, as it allows the company to further expand its reach and influence in the iGaming industry.

The studio will enable iGaming NEXT to produce even more engaging and informative content for its listeners, while also providing a valuable resource for its partners.

“We are extremely excited to launch our new podcast studio,” said iGaming NEXT MD and co-founder Pierre Lindh.

“We believe it will play a crucial role in our efforts to provide top-quality content for the iGaming industry and beyond.

“We are also thrilled to be able to offer the studio to our partners as a resource for their own media projects,” he added.

The iGaming NEXT Podcast is brought to you by Pragmatic Solutions.

If you would like to learn more about the iGaming NEXT podcast studio and our rent rates, please contact artur@igamingnext.com.

Australian NFT gaming platform Balthazar DAO has secured a further $2m in a Private Round Token Sale, bringing its fully diluted valuation to $60m.

The funds will be used to recruit product experts and engineers to build its software development kit, Babylon, which includes a proprietary noncustodial wallet system.

The start-up has now raised a total of $5.6m over the past year, following both pre-seed and seed-round Token Sales.

Tim Heath’s Yolo Investments were included in the Private Round Taken Sale, along with private equity institutions such as IDG Capital, Tezos Foundation and Kucoin Labs.

“The NFT gaming niche will ripple through the video games industry at large and the future may belong to NFT gaming entirely,” said Heath.

Additional investors included Hive Empire Capital, led by Finder’s Fred Schebesta, as well as Digital Asset Capital Management (DACM), Gandel Invest, Fantom Foundation, Red Building Capital, Vendetta and Pluto Digital, among others.

NFT-led horse racing project ZED Run invested in Balthazar during a previous round, as did Zip co-founder Larry Diamond.

Despite a turbulent end to the year for crypto assets and NFTs, Balthazar CEO John Stefanidis insisted that digital ownership, and its application through Web3, was the future of the gaming industry, which is expected to reach $294bn by 2024.

Yolo Investments general partner Tim Heath: “The NFT gaming niche will ripple through the video games industry at large and the future may belong to NFT gaming entirely.”

“We’re building technology that’s applicable to not only the gaming space, but the entire crypto industry,” said Stefanidis in a press release.

“We’re starting with gaming, to solve the problems of easy onboarding, opening accounts, in-game marketplace, peer-to-peer transactions, Web3 inventory management systems and on-chain in-game transactions in real time.

“We will expand into solving problems around password and credential recovery, which will unlock categories such as DeFi, and other products that are really good but hard to access for Web2 users.

“We’re very clear in our mission to allow people to own their assets. That’s the underlying value that we’re adding,” he added.

According to the PwC H1 2022 Global Cryptocurrency Mergers and Acquisitions Fundraising Report, crypto fundraising in 2022 looks set to outperform last year’s total of $36.6bn.

Total funds raised in the crypto market reached $24.2bn in H1 2022 according to the October report, which is 20% higher than H1 2021.

The report states that NFT and metaverse projects received one-third of all deals in H1 2022 (34%), compared with just 4% during the same period of last year.

Even in this market, NFT gaming is growing quickly in terms of the number of games that are entering the space and the number of gaming funds and funds being raised,” added Stefanidis.

Balthazar is now focused on building a noncustodial credential recovery system that will allow people to hold on to their own assets but remove the risk of losing passwords.

On its official website, Balthazar is described as an NFT gaming platform for the metaverse designed to make NFTs, cryptocurrency and gaming more accessible for people.

Marketing technology provider Betegy has appointed TV and brand expert Phil McIntyre to its senior team as executive VP for North American sales.

The announcement comes as the company seeks to bolster its standing across the US gaming and broadcast industries after receiving a multi-million euro cash injection from venture capital firm Yolo Investments in September.

Based at the company’s newly established New York City office, McIntyre will be responsible for expanding the company’s relationships with the US and Canadian entertainment sectors.

McIntyre’s appointment will further complement the company’s European growth, which has seen Betegy sign content deals with some of Europe’s biggest broadcasters and operators, including Entain, Parimatch and Tipico.

Prior to Betegy, McIntyre held executive positions as senior VP and business development consultant at media group Nexstar Digital and has also served as senior VP and business development consultant at media consultancy SmithGeiger.

He has managed campaigns for many of the world’s most recognised brands in media, sports, entertainment, consumer products, and luxury goods – including CBS, Univision, Sony Entertainment, Sinclair, CNN, Bloomberg Television, Comcast, ESPN, Starwood Capital and Hearst.

Betegy CEO Alex Kornilov: “[McIntyre] brings nearly three decades of sales, branding and entrepreneurial experience, and an unparalleled network of contacts throughout the US media business.”

Commenting on the appointment, Betegy CEO Alex Kornilov said: “Phil has been a consultant and great supporter for Betegy for a few years now, and we are thrilled to finally have him on board. He brings nearly three decades of sales, branding and entrepreneurial experience, and an unparalleled network of contacts throughout the US media business.”

He highlighted that McIntyre’s expertise helped companies leverage research and data for both brand development and visual optimisation across digital, mobile, social, multi-screen, ecommerce and even the world of VR.

“This is exactly what we are set to do at Betegy, and with serious plans to disrupt the future of sports and gaming, we’re fully confident that he’ll be able to help the largest global brands capitalise on our technology,” Kornilov said.

McIntyre added: “I’m extremely grateful for the opportunity and excited to join a strong team of innovators and complement it with everything I have to bring aboard.”

Established in 2012 in Warsaw, Poland, Betegy operates an automated content generation and production system that turns complex sports data into personalised digital and broadcasting graphics, as well as animations, banners, landing pages, widgets, and texts.

Content automation and personalisation provider Betegy has partnered up with venture capital firm Yolo Investments to drive the next stage of its global expansion.

Estonia-based Yolo will take a non-controlling stake in the firm in return for a multi-million euro investment.

The exact sum has not been disclosed, but iGaming NEXT understands the capital injection was somewhere in excess of €5m.

The funds will be used to help scale Betegy’s platform further. Using machine learning algorithms, Betegy operates an automated content generation and production system that turns complex sports data into personalised digital and broadcasting graphics, as well as animations, banners, landing pages, widgets, and texts.

Commenting on the investment, Betegy CEO Alex Kornilov said: “Our system’s innovative approach has enabled us to be the first in the industry to bring the instant creation of data-driven visual content for all communication channels, including social media, TV production, retail, paid acquisition, SEO, sports media and affiliate marketing. 

“This is unprecedented in terms of the deep personalisation of visual marketing campaigns we’re able to deliver, and this is where we truly make a difference – by being able to personalise campaigns that resonate with multiple audiences instantaneously.

Yolo Investments general partner Tim Heath: “Investing in Betegy made perfect sense because we see an opportunity for significant synergies across the Yolo Investments ecosystem.”

“We’re very proud to be partnering with one of the iGaming industry’s most innovative and dynamic companies for our next stage of growth, and we can’t wait to get started together,” he added.

Betegy’s clients span major organisations in sports, gaming, television and digital media, including ESPN, Entain, Ringier Axel Springer, bwin, Yahoo Sports, Sportsbet.io, 22bet, Parimatch, PokerGo and Winners.net.

“Investing in Betegy made perfect sense because we see an opportunity for significant synergies across the Yolo Investments ecosystem,” said Tim Heath, founder and general partner at Yolo Investments.

Yolo holds investments in more than 80 companies with total assets under management in excess of €375m.

“Betegy’s products are already being used by some of the biggest names in gaming, and we’ll be working closely with the team to help it on the next step of its journey,” Heath added.

Betegy’s latest investment round builds upon the company’s partnership with JKR Investment Group, which has provided the foundation for Betegy’s initial expansion into the US market.

Apparat Gaming co-founder Martin Frindt has agreed to take on an active role in the operations of the German games development start-up.

Frindt’s primary responsibilities will be to assist with the alignment of the rapidly expanding company and to close more top-tier partnership deals in the German market and beyond.

Founded in 2020, Apparat Gaming is on a mission to deliver ‘iGaming with a German Accent’ and has struck high-profile partnerships with Relax Gaming, Pariplay and others.

It recently received investment in excess of €1m from venture capital firm Yolo Investments.

Apparat Gaming director Thomas Wendt: “Martin is a crazy slot nerd, and his experience in the industry speaks for itself.”

As a serial entrepreneur, Frindt is one of the co-founders of Apparat Gaming, but he has now joined the team in an official capacity.

Frindt commented: “I’ve been involved with Apparat Gaming since its inception, but now I am officially part of the team, and that feels great.

“The company has achieved so much in such a short space of time. All I can say is I’m proud to be involved, and I am ready to go full throttle,” he added.

Before Apparat Gaming, Frindt was co-founder of Crowdpark, a social betting and gaming start-up, which was backed by Earlybird and Target Partners.

It was later partially acquired by one of the largest land-based casino operators in Germany, which was when he met Thomas Wendt, another co-founder of Apparat Gaming.

“Martin is a crazy slot nerd, and his experience in the industry speaks for itself,” said Wendt.

“With his tech background, his ability to familiarise himself with almost any topic and his proven record of building companies, it was a no-brainer to found with him. And it’s always fun to work with him,” he added.

In his previous role as head of online and MD of the iGaming subsidiary of Bally Wulff – the number three slot machine manufacturer in Germany – Frindt was responsible for the development of more than 40 online casino titles.

Frindt is a cycling enthusiast and vegetarian by conviction. He owns a bike clothing company, and often can’t decide in the morning which of his six bikes he will use to get to work.

Venture capital fund Yolo Investments has acquired an interest in German game development start-up Apparat Gaming.

While financial details of the transaction were not disclosed, iGamingNEXT understands Yolo’s investment in the start-up is in excess of €1m.

This is the first round of external investment for Apparat Gaming, which was founded in 2020 by a team of eight gaming professionals. They have the ambition to “deliver slots that meet German engineering standards as well as the highest artistic quality”.

The company received a B2B licence form the Malta Gaming Authority back in 2021 and has become a supplier of online content for operators in Germany and other European markets.

Alina Dandörfer, co-founder and director at Apparat Gaming, said: “We’re excited that Yolo has chosen us because we know they only invest in the best. It’s a real vindication of everything we’ve worked for. And with Yolo’s backing, we can achieve even greater things.”

Apparat Gaming is the latest in a long line of gaming industry investments for Yolo, including Green Jade Games, Turbo Games and Kalamba.

Yolo Investments founder Tim Heath: “We’re always on the lookout for start-ups with a passion for evolution and Apparat ticks that box.”

The Guernsey-based venture capital fund focuses on seed- and A-stage investment opportunities across gaming and fintech, with an emphasis on innovation and tech disruption.

Founded in 2017, the fund today holds investments in more than 55 companies, with assets under management (AUM) of approximately €375m.

Yolo Investments founder and general partner Tim Heath said Apparat Gaming had impressed by achieving remarkable visibility in a very short space of time while making inroads throughout Germany and Europe.

Meanwhile, its technology was eye-catching, as was its commitment to recruiting talent, he said.

“We’re always on the lookout for start-ups with a passion for evolution, and Apparat ticks that box,” Heath added.

“At Yolo, we have a ‘people first’ attitude and we recognise that Apparat has put together an amazing team of creative individuals with a 360-degree understanding of the industry. We’re delighted to be part of their developing story.”

Last month, Heath talked to the iGaming NEXT podcast about managing crypto investments through a market crash.