Go west: Why PointsBet is shifting its US tech focus to Denver, Colorado
US CEO Johnny Aitken talks to EGR Technology about why the firm has set its sights on Colorado to secure fresh tech talent as it expands its North American footprint
Six months since launching its US-facing online sportsbook in New Jersey, Australian listed PointsBet has grown its market share by 3.2ppts to 5.4%. A feat it attributes to its laser-sharp focus on product and what the US customer wants.
It is becoming increasingly difficult to ignore movements stateside, particularly as some of Europe’s most well-known and best performing operators shift their sights across the pond to leverage a market that has the potential to be even bigger than the UK.
PointsBet, which is headquartered in Melbourne, Australia, has put all its eggs in one basket with the US. As US CEO Johnny Aitken says: “It’s all eyes on America” as even its Aussie staff are working on the North America roadmap.
“Our technology has allowed us to enter the market quickly with a US focused app that I would still say is minimum viable product,” says Aitken in response to the firm’s prominent New Jersey growth. “We offer the most markets in the world for all pro US sports, and then name-a-bet and points betting are our innovative products. We’ve got very sticky clients that are very loyal.”
In July, the Meadowlands licence, which has both PointsBet and FanDuel operating on it, topped the bill with an internet GGR of $7.3m (£6.1m). Resorts, led by DraftKings’ sportsbook, followed with online revenues of just under $3.7m (£3.1m).
PointsBet has long said it maintains a tech-first approach in its march on the US and it seems that rings largely true as the firm now looks to open a major tech hub in Denver, Colorado that will tap into the vast talent of the West Coast.
The plans include a workforce of up to 200, with the majority to work on tech and product development. The operator’s newest addition, president of product and technology Manjit Singh, will lead the team and the huge recruitment drive that will precede it.
“We’ve come up with a plan to establish say 200 roles by the end of next year. Fifty percent of which will be in technology but we will also have our finance operations here as well as qualitative analytics, CRM, product and there will also be an opportunity for people at an entry level in customer services and sports analytics,” Aitken says. “It will really present opportunities for different types of people.”
Johnny Aitken, PointsBet
The Centennial State
Aitken will himself relocate from the firm’s New Jersey hub, which he maintains will continue to house its operations for the east coast. Perhaps the most pressing question from this announcement is why Denver?
A quick Google search will tell you the Colorado capital has had an impressive spate of tech companies invested in maintaining a presence in the city, from aviation giant Boeing to media mammoth Comcast. It was also once the birthplace of telecoms behemoth AT&T’s cable operations, AT&T Broadband.
More recently, the Centennial State has established a booming fintech industry with Forbes, recognising Denver as one of the top 25 metro areas with the most financial jobs. According to PitchBook Data, the city saw $29.5m of fintech venture capital fundraising in 2018.
Commercial real estate investment firm CBRE Group ranked Denver the 10th highest scoring city in North America for tech talent in 2018. It narrowly lagged behind Atlanta in Georgia, Raleigh-Durham in North Carolina, Boston in Massachusetts, and Austin, Texas.
Denver, Colorado
Picture: iStock.com/f11photo
The rankings are based on tech talent supply, growth, concentration, cost, completed tech degrees, industry outlook for job growth, and market outlook for both office and apartment rent cost growth. At the time the rankings were released, CBRE SVP, tech and media practice Alex Hammerstein said the metro Denver area’s tech talent pool made up 6.2% of its entire labour force, well above the national average of 3.5%.
But for Aitken, Denver’s most appealing attribute was its quality of life index. “We did a lot of due diligence and went through 30 cities in America. On top was Denver, second was Austin and third was Phoenix, Arizona,” Aitken tells EGR Technology.
What tipped Colorado over the edge was its likelihood to legalise sports betting in the next year, as a referendum on the matter looms in November. A similar decision was put to the people when the state considered legalising marijuana, and when the masses voted largely in favour of the drug, movement to make it legal was swift and efficient.
“We were very advanced in our discussions with our partner in Colorado, so we had a great sense we would be there. We’re very positive that it will be up and running next year when the partnership will be live there, so that played a big part in the selection of Denver,” Aitken says of the firm’s market-access deal with the state’s Double Eagle Hotel and Casino.
Looking west
When considering Austin as a potential hub, Aitken says the firm’s chief innovation officer Seth Young is bullish betting will go online in two to three years, but he is not so confident. Crucially, Colorado’s geographical positioning is prime for tapping into the reigning tech hubs of California and Seattle, Washington.
“I think we’ll attract tech talent from LA or those that have gone to Seattle or the bay area and want to come back home to Denver. [We’re] providing a really appealing opportunity for those tech people as an alternative to going to work for Google or Amazon perhaps,” says Aitken.
“We want to compete against those companies for the best talent. We’re still relatively small and people can come in and make a difference and have their ideas heard.”
To further cement the firm’s commitment to Colorado, the state has granted it a $4.1m (£3.4m) tax break in the form of the Denver Economic Development Grant, considering its pledge to create 211 local jobs with an average annual salary of $87,000 (£72,149)
The commitment includes working relationships with local technology universities to attract graduates to the company. Speaking to local news outlet the Denver Business Journal, Aitken said: “We really did want to have a presence in the area, it ticks the box off from a sports-loving perspective and ticks off the box as a tech hub. We’d have access to the best and brightest minds. It came out on top very clearly.”
With sports betting an extremely nascent industry in much of the US still, Aitken says a major facet of the project will be to educate potential tech staffers on the industry. “The opportunity to work in an industry which is just starting here in America is doubly exciting,” he adds.
Leading the charge
Roles in both front- and back-end development will be created, along with dev ops, UX and UI design and quantitative and sports analysts. The firm owns its entire tech stack and plans to continue to do so.
The hiring of product and tech president Singh in July was a tactical move to sharpen the firm’s tech focus and capabilities. Singh joins the company a year after starting his own cyber-security firm. Between 2012 and 2016 he held the position of CTO at social gaming and slots machine provider Aristocrat. In his role, Singh provided technology and product direction on worldwide platform and systems for mobile, online and traditional slot channels.
PointsBet group CEO Sam Swanell said of the appointment: “Manjit recognises the progress we have made and the opportunity ahead. [He] will bring key leadership and technology capabilities to the global business and is well placed to drive our technology and product strategy as we continue to expand in the US.”
As a great deal of focus shifts to the Colorado launch, or ‘Project Mirage’ as it’s been dubbed by the company, Aitken is keen to give some recognition to its Jersey City headquarters which has grown a workforce of 50 staffers. “New Jersey is the shop-front and it’s what has allowed us to have very serious conversations with others in other states,” he says. “It will still retain our core team of marketing and brand operations and content and CRM.”
In New Jersey, the firm’s USP has its high-risk, high-reward offering. Players’ wins or losses are determined by how accurate their bets are. But Aitken says the Garden State is only the beginning for PointsBet, and along with a myriad of new market-access deals signed in multiple states, including Iowa and West Virginia, the Denver headquarters represents a major step in expanding its national footprint.