Women in gaming: Paris Smith on esports betting

It is now over a decade since Pinnacle accepted its first esports bet: a modest $9.55 staked on real-time strategy game StarCraft back in February 2010. Overseen by Marco Blume, now the firm’s trading director and once a highly skilled player of card game Magic: The Gathering, betting on competitive digital matches soon snowballed, resulting in betting volumes doubling year-on-year. By December 2014, the Curaçao-based bookmaker had laid one million bets on esports as it overtook sportsbook mainstays golf and rugby. Three years later, the milestone of five million bets was reached. And as Covid-19 wreaked havoc on traditional sports in spring 2020, esports, which has its own dedicated hub at Pinnacle, took centre stage.

“The shutdown of most major sports definitely thrust esports into the betting spotlight,” says CEO Paris Smith from the company’s office on the Dutch Caribbean island. “While we hadn’t planned for this spike, we were very well set to deliver on it due to the years of investment and development into our esports product in the decade leading up to 2020.”

Smith adds: “We saw our core esports customer base grow organically during the shutdown, and we haven’t seen this demand fall away in a way that some operators have highlighted.” B2C esports growth has been stellar, yet growth has been more pronounced within the company’s B2B division, Pinnacle Solution, with certain partners seeing the product outperform tennis and even football in some instances.

Pinnacle has forged a reputation in the world of international bookmaking as a high-limit, low-margin online operator where, uniquely, winners are welcome. When the business first offered esports bets the limits were €100, but these days limits are €10,000 and can rise to an eye-popping €250,000 for the most high-profile events involving what Smith labels the “big three”: CS:GO, League of Legends and Dota 2.

“Our trading team loves the challenge of taking on the smartest betting minds. And backed by market-leading modelling expertise and exclusive data partnerships, they have the confidence to offer highly competitive limits – this is really one of our USPs,” Smith explains.

And these days, much akin to traditional sports, more and more of the betting takes place after the action starts. In fact, live wagering now “far outweighs” pre-match esports revenue at Pinnacle and Smith fully expects in-play to “continue to dominate”.

“The thrill of esports comes in its real-time, frantic nature, and live betting is a huge complement to this experience. With streams readily available for major and minor events, those looking to test their knowledge against the bookmaker have round-the-clock opportunities to do so.” However, Pinnacle’s CEO insists that offering limited live markets like the winner and handicaps won’t cut it nowadays for esports bettors who, per Pinnacle’s research, are typically five years younger than its sports customers.

“Our customers want and deserve more, and that’s why we’ve actively invested in real-time data partners, enhanced modelling tools and individual esports experts to deliver a live esports betting experience that covers core and derivative markets, as well as unique specials, all with lower lags and higher uptime.”

In tandem with the rise of esports and betting on competitions emerged an inevitable consequence: match-fixing. In April, it was announced the Esports Integrity Commission (ESIC) and the FBI were investigating allegations of match-fixing and illegal betting involving CS:GO. Three months earlier, ESIC banned 35 Australian players for flouting its anti-corruption code by betting on their own matches, while another seven Australians were banned in 2020.

Furthermore, Riot Games recently concluded a two-month investigation into match-rigging involving China’s League of Legends Pro League and its academy league, resulting in a number of players receiving suspensions and permanent bans. “Match-fixing will always be a concern to us, no matter the sport, and within esports we’ve integrated several alerting systems that are triggered by suspicious activity,” Smith reveals.

“Some of these are model-led, others subjectively assessed by our expert trading teams, and working with data partners, we’re quickly able to process any concerns by looking at raw data. One of the beauties of esports is a data footprint over regular sports played on a field or in an arena.”

Smith also believes ESIC is “doing a great job” to set high standards around game integrity and that teams are now much better educated on potential threats and punishments. “With salaries rising and prize pools growing, the threat of throwing matches also diminishes.”

She is also adamant that esports, today a multi-billion-dollar industry, still has plenty of headroom for growth in the years ahead. So, with bigger and bigger esports competitions, the advent of 5G and the potential of AR/VR, are we still scratching the surface? “Having been in the game over a decade now, we’re well beyond scratching the surface, but it’s fair to say there’s vast untapped potential for the industry to develop,” Smith concludes.