Despite a relatively inauspicious start as a US online sports betting operator, a new round of funding for upstart micro-betting operator Betr generated $35 million for the company, which is now valued at $300 million.
The company completed its Series A2 funding round during this quarter with the round led by IA Sports Ventures, Eberg Capital, and Fuel Venture Capital upping its stake from $10 million to $20 million.
Betr is currently live in Ohio and Massachusetts and the brand has not made much of a dent in terms of market share. Betr co-founder and CEO Joey Levy has said before he does not care about market share but it is worth noting that, even with low promotional costs, Betr is still losing money so far in states where it is live.
In its first month of operation in Massachusetts, Betr accepted nearly $600,000 in wagers and generated $47,000 in revenue, keeping around $37,000 after taxes.
In Ohio, Betr struggles to even hold 1% of the market and consistently spends more on promotions than the book brings in. In April, Betr accepted $751,000 in wagers, generated $33,500 in revenue, and awarded $133,500 in promotional credits. Save for January, where the brand earned $10,000 more than it spent, it has not had a profitable month after promotional credit spend.
Nonetheless, the company is generating buzz for its unique approach to the market with a focus on micro-betting and the support of social media star and co-founder Jake Paul.
“I am thrilled to announce our Series A2 round of financing, which we opportunistically raised after successfully laying the foundations for Betr Gaming and Betr Media while validating some of our core theses,” said Levy. “Our ability to rapidly scale Betr Media’s audience, and then convert this audience to Betr Gaming at low-to-no-CAC, will enable us to have the best unit economics in the regulated real money gaming industry, positioning Betr to create more value than incumbent operators over time. The three pillars of our business are 1) low-to-no-CAC supported by unique social media expertise, 2) strong user engagement and retention supported by brand affinity and a differentiated product, and 3) a focus on responsible gaming supported by a team that believes in doing the right thing. We have seen material validation of pillar one, we have demonstrated leadership and still have more planned with respect to pillar three, and we will be better positioned to validate pillar two after launching our two other real money gaming verticals and V1 of Betr Betting on top of the recently acquired Chameleon platform.”
Betr announced the Chameleon acquisition in May, setting the brand up to expand into the online casino industry eventually. The company paid FansUnite $7.45 million for the technology.
“Betr is poised to change the dynamics of the OSB landscape by moving “entertainment” front and center through compelling content, a superior user experience, and deeper engagement across both major and alternative sports,” said Roger Ehrenberg, founding partner of IA Sports Ventures. “Sports have a special ability to bring people together, and no company is better positioned to accelerate and benefit from this trend than Betr.”
“Joey, Jake, and the incredible Betr team are truly creating something remarkable,” added Jeff Ransdell, Founding Partner & Managing Director of Fuel Venture Capital. “They are addressing a genuine need in the sports media and betting world, catering directly to the end consumer. The overwhelming demand from investors wanting to join this journey is a testament to the validity and promise of what they’re building.”
