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Betr has employed payments platform Paysafe to make its app user experience better. As Betr attempts to scratch out a share of the online sports betting market in two United States jurisdictions, it’s necessary to have a smooth deposit and withdrawal process in its app.
But Betr might need more than a seamless payment processing experience to live up to its own billing of “disrupting the US sports betting space,” however. Based on early results, disruption is among the last potential descriptor of the company’s activity.
Betr adds Paysafe to vendors for Massachusetts, Ohio sports betting
According to a news release from Paysafe, “the first phase of a multi-state deal sees Paysafe enable Betr’s customers in Ohio and Massachusetts to seamlessly fund micro-bets and traditional wagers using their debit card.”
Paysafe is a payments platform that services online gambling companies along with partners in other industries in the US. Among its other gaming partners are Caesars and DraftKings.
Massachusetts and Ohio are the only two US states in which Betr is currently offering online sports betting. Betr has no physical sportsbook in either market nor any other US jurisdictions. However, it does have agreements that could enable it to also launch its app in Indiana and Virginia. Currently, plans to launch in those states are tentative.
Boxer Jake Paul is among the foremost investors and face of Betr Gaming. He has been among those touting the company’s potential to “disrupt the US sports betting space.”
The plans to disrupt may become more tangible after a recent funding round. However, even the new capital might not prove sufficient for Betr to truly disrupt the US sports betting space.
Betr has struggled in its early returns
A late June news release from Betr sharing details about the A2 funding round paints an appealing picture. That painting looks better than the current situation for the gaming brand.
The release touts Betr as possessing “a unique product experience … enabling Betr to capture more of the underpenetrated online gaming addressable market.”
It’s unclear exactly who Betr believes comprises an addressable market that is “underpenetrated.” For that reason, whether Betr is having success in capturing more of that vague and potentially amorphous group is difficult to ascertain.
Based on the early returns in both of its active markets, though, the need for greater capture is stark. In its first partial month of operation in Massachusetts (May), Betr accounted for one one-thousandth of a percent of all dollars wagered online legally in the state.
In its first full month in Massachusetts, the dollars that people wagered on Betr’s app fell to eight ten-thousands of a percent of the whole. While things are slightly better in Ohio, where Betr accounted for 0.19% of the money bet online in May, that share was “worsr” than all but one other licensee operating in Ohio during the month.
In fairness, there is only one full month of data in Massachusetts and six months of data in Ohio. It’s early. Improving upon those market shares might prove quite difficult regardless.
Arduous road ahead for Betr
While the release says Betr has benefitted from “over 20% of Betr Media’s estimated Ohio audience already converting to real money gaming customers for Betr Gaming,” there’s a downside to that statement.
If Betr has already achieved conversion of 20% in Ohio, that means it only has 80% of that audience remaining to convert. If you simply extrapolate its latest market share forward, that might translate to a market share of 0.95%. That is assuming the ratio remains consistent, of course.
If Betr’s media division can continue to grow, that pool would, in theory, grow larger. Thus, 80% of a larger pool could translate to a greater market share. Whether that would be truly large enough to actually disrupt the industry is debatable.
The release goes on to say that “Betr Media is driving low-to-no-CAC (Customer Acquisition Cost) for Betr Gaming, positioning the Company to have the best unit economics in the OSB (Online Sports Betting) and iGaming markets.” In other words, instead of spending capital on advertising for Betr Gaming, Betr Media acts as the marketing arm of Betr Gaming.
It’s technically true that Betr’s strategy doesn’t involve spending to create sports content and then buying ads for its online sportsbook on top of that. However, money spent on creating content is still money spent. Regardless of the spin, Betr is spending to acquire customers. It’s just labeling that customer acquisition spend as a content creation cost.
To date, Betr has not struggled to convince investors that its path to growth is sound. If it continues to earn less than a percentage point of gamblers’ spend in its active markets, though, spinning things in a positive light may become more difficult.
