sports betting wagering innovator launches new start-up
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17 November 2021

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By Douglas Fraser

Business and economy editor, Scotland

Among Scotland's most effective innovation groups is starting again with a new company - and has secured the greatest initial investment of any British start-up company.

BetDEX is being led by Nigel Eccles, who co-founded fantasy sports betting wagering website FanDuel in 2009 in Edinburgh.

The new company has seed financing of $21m.

It aims to introduce a brand-new open source software platform, on which others can innovate in sports betting, in the very first half of next year.

The business is recruiting staff from a base in Scotland.

FanDuel was sold to Flutter - previously named Paddy Power Betfair - in 2018 and is now worth more than $30bn.
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However, Mr Eccles and other co-founders remain in legal disagreement with FanDuel's later phase investors over the method which they structured a takeover, which left the Edinburgh team without a share of the rising appraisal.
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Mr Eccles said that one thing he discovered from the FanDuel experience was to choose financiers carefully.

He told BBC Scotland: "We took a great deal of lessons from that, among which was the importance of who we pick as investors in this new company, to ensure their values are lined up with ours, that they take their fiduciary duties responsibly, and that they're the ideal partners for us."

The $21m seed financing for BetDEX consists of stakes taken by seven backers of US technology companies, including 2 large funds - Paradigm and FTX - which specialise in investing in companies operating with crypto-currencies.

Varun Sudhakar, president of BetDEX, said: "The sports betting industry charges high costs for bad products and limitations trades by its most effective users.

"BetDEX is diametrically opposed to this technique. We will successfully contend against incumbents with a considerably superior product and low costs, which is now possible with the development of the blockchain innovation."

As chairman of the new firm, Mr Eccles said it could look familiar to retail punters utilized to existing online companies.
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'Pool of talent'

However, he says that those who use its platform to run their own wagering firms will have the ability to innovate and produce a larger variety of sports betting products.
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He said the typical share taken by online bookies is 7% to 10% of a stake, but BetDEX should permit that to fall below 1%.

The company will develop its own sports betting apps to run on the platform.

Mr Eccles said these would take an "smart, thoughtful" method to the way they are marketed to safeguard those who have a hard time with issue gambling.

He stated the team of around 500 software engineers who helped build FanDuel from Scotland showed that it remains the location to construct a firm. BetDEX has the same head of innovation, Stuart Tonner.

"A lot of that [FanDuel] was built on a highly proficient, really talented engineering group, that constructed this item that could process countless bets and countless users.

"There's a real skill swimming pool of knowledgeable engineers who helped us develop our product and that's what we wish to take advantage of for BetDEX also."

Related subjects

Edinburgh

sports betting wagering

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Paddy Power purchases fantasy sports betting website

23 May 2018

FanDuel founder leaves company

Published

20 November 2017