Show Notes from Knup Sports Show

Show #133 – Brent Winston of BetSwap Talks About Selling Your Betting Tickets

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Dan Zimmermann of Verse Gaming talks about his journey from Barstool Sports Syracuse to launching his own company. Listen in on episode #132!



Listen in as Brent Winston of BetSwap talks about his innovated product that allows bettors to sell their betting ticket to another interested party — directly through the operator interface

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Ryan Knuppel:

Hey, what’s going on, everybody. Welcome to the Knup Sports Show. I’m your host, Ryan Knuppel here, episode number 133. As always, we have a special guest with us and we’re going to try this again. We’ve tried this before and it didn’t go so hot due to connection issues, but guess what? We have Brent Winston of Betswap with us. Brent, are you here? Can you hear me?

Brent Winston:

I’m here, Ryan. We’re good this time. We’re clear. We’re clean.

Ryan Knuppel:

Hey, we’re good. You know what? If it doesn’t work once, we try again, but hey, I appreciate your patience with me. How are you today? You doing all right?

Brent Winston:

Everything’s great. I mean, we were just discussing backstage, woke up with some news this morning of Penn acquiring the score of Canadian Sports Betting company. So nice to see a little old Canada getting some recognition in the space as we continue to move towards legalization.

Ryan Knuppel:

Well, you know me, I love anything industry news-related, anything talking about this great industry that we live in, and the score in Penn, both great companies. And I’m happy that they were able to make something happen. And it’s great news for anyone that’s really investing or just a part of those companies. So really cool news this morning for those of you that haven’t seen it yet. So I’m glad you brought that up right away.

Brent Winston:

For sure. No, I think that everything in Canada is always a smaller little version of the U.S., and I think it’s no different with Penn and the score. The score replicates a lot of what Penn does and I’m excited to see what they do moving forward, for sure.

Ryan Knuppel:

For sure. For sure. So I want to jump into Betswap, but first I want to understand a little bit more about you, Brent. I want everyone, the listeners to understand your history, your path, what kind of makes Brent tick. What got you to where you are today? Tell us a little bit about yourself.

Brent Winston:

Yeah. No, for sure. I mean, by trade, I’m actually a practicing lawyer. I worked at a big tech company that is mostly legal counsel in Toronto, big North American tech company. But for me, just a huge sports fan and grew up playing hockey, as most Canadians do, and was okay at it. But my parents thought it was more appropriate for me to go into professional services rather than play sports. But I always wanted to find a way to keep my involvement with sports, whether it was playing or by happenstance, I started to bet on them. I wanted to try and keep my involvement with sports.

Brent Winston:

And as I continued to get older, and I learned about what an amazing thing betting on NFL Sunday football was, it ignited a passion for me with sports betting. And as I continued through it, there were certain gaps that I saw in the market that I just wanted to use as a user myself. And I was talking with my brother about the concept one day of being able to buy and sell my bets with other sports betters, because I had seen so many different Facebook groups or posts on Reddit about wanting to sell or hedge certain bets. So what if we could just do it online? What if we could just do it within the sports book? He goes, if you don’t build it, I’m going to build it and you don’t want that. So I said, okay, sounds good. I’ll set out to try and build that. And I think that was probably about two years ago.

Brent Winston:

And now we’re at a place where we’ve almost got our first client log. We’re hoping to be able to do so within the coming months, the big name in the sports betting industry. And yeah, I mean, just a diverse guy, I’d like to think, practicing lawyer. I have a few couple of businesses on the side, one of which is Betswap. That’s Brent in a nutshell.

Ryan Knuppel:

Yeah. That’s a cool story. I love that story. And Hey, if you don’t build it, I will. You’re like, okay, I’m in, I’m doing it. I’m making this happen. It’s nothing like a good old kick in the butt. Right?

Brent Winston:

Exactly. Exactly. It’s been like that my entire life. There are all these ideas that I come up with. He said, oh, that’s good. You should do it. I go, I don’t have the time. And then sure enough, somebody else wounds up doing it. So with this one, I felt like we had to actually drive it forward.

Ryan Knuppel:

Yeah. So let’s expand on Betswap then. I mean, you mentioned it a little bit, betting against your friends or taking your friends’ bets, but expand a little bit on the concept of Betswap and let’s dive deeper into the product.

Brent Winston:

Yeah. I mean, in its simplest form, the best example I can give you is imagine you place a bet on the Tampa Bay Buccaneers to win the Super Bowl at the outset of the season at 10 to one odds. I’ll use real simple numbers here, $10 bet, 10 to one odds, so it’s 100$ payout. As the Bucks continue to progress through the season, Julian Edelman decides to come back this year. He’s now playing with Tom, in addition to everybody else that Tom’s got as a weapon out there. And now halfway through the season, instead of the Bucks being 10 to one odds favorites, they’re now five to one. So there’s an implied value in the initial bet that you’ve made at 10 to one odds.

Brent Winston:

As the season continues to progress, let’s say the Bucks get to the Super Bowl again, and now they’re one-to-one odds to win the Super Bowl. That individual who made the bet at the beginning of the season at 10 to one odds has a real valuable ticket, because if anybody wants to bet on the Bucks to win the Superbowl, they’re making a $10 bet for a $10 payout. Whereas the guy at the beginning of the season made a $10 bet for 100$ payout. So that guy who made the bet at the beginning of the season could sell his ticket for, I don’t know, $40 bucks or $50 bucks. And he’s winding up cashing out with a greater value than the book would actually offer. And the purchaser is getting better odds than anyone else available in any sports book.

Brent Winston:

So the idea is, is that the purchaser can get odds that aren’t available anywhere else. And the seller is able to lock in value that they deem appropriate as opposed to having to be dictated to by Casha. And we see at least on our side of the coin, we think that this is going to be real big for parlay bets for NFL Sunday games, where you’ve got the one o’clock, the four o’clock, the seven o’clock for PGA tour events as we progress through Thursday, Friday, Saturday.

Brent Winston:

I mean, even for me, I got Dustin Johnson, I think, at 20 to one. We’ve had Jack Keller on the show. I love Jack. Jack is a good friend. I followed Jack’s ginger bets every single week and when I got called Maura Callan to win the open at the 33 to one odds, they think it was, because of Jack. And on Sunday, when Maura Callan was [inaudible 00:05:59] in contention, I mean, I should be able to unwind that bet at a price that’s greater than what Casha dictates. So I mean, those who want to use Casha will continue to do so, but there’s such an underserved market out there who love to be able to sell their bet or interact with other betters on the website that they’re using, the sports book that they’re using, but just don’t have the opportunity to do so. Further, not everything’s cashoutable, right?

Ryan Knuppel:

Yeah. Right.

Brent Winston:

I mean, there’s so many different bets that we place on our sports, but they can’t be cashed out and it takes forever for the Sportsbooks to find time on the roadmap to build the actual functionality. So why not use a product like Betswap, where they’re able to now offer cash out ability on every ticket, and they can provide optionality for users. I mean, that’s where we’re heading in today’s day and age with Sportsbooks. It’s all about optionality for users.

Ryan Knuppel:

Yeah. I love it. I mean, it’s absolutely a great concept and I think definitely something that’s needed out in the industry. Tell us a bit about the technology. I mean, are you guys app based only? Do you have a desktop version? What’s the technology looking like to make this happen?

Brent Winston:

Yeah. So, I mean, from a user standpoint, we’re going to do it as an integration with each individual sports book. We’re not going to operate as a standalone third-party aggregator. There are many different parties out there that do that. They allow you to come their websites, list their ticket that you purchase for sale, and then anybody can come onsite and see that ticket that’s available and buy it. We’re trying to keep it within a closed ecosystem. So, if you’re on the DraftKings Sportsbook, only drafting users could buy and sell DraftKings tickets. If you’re on the bet MGM Sportsbook, only bet MGM users can buy and sell the bet MGM tickets. There are a whole bunch of reasons for that, that we’ve spent almost years really going through and determining which made the most sense and why. But Sportsbooks also want to make sure that they retain users, right? You don’t want to be pushing users from DraftKings to Entain to FanDuel and vice versa.

Ryan Knuppel:

So tell me how that works though. So if I buy a ticket from someone else, I mean, am I physically seeing that come into my DraftKings account? I mean, is that all that happening behind the scenes or is that … How is that working?

Brent Winston:

That’s right. I mean, it’s no different than StubHub when you think about it, right? You go onto StubHub, you see the ticket that you want to purchase, you purchase the ticket, you outlay the cash, and then the ticket shows up in your account just like that.

Ryan Knuppel:

Really cool.

Brent Winston:

So you’d see the ticket in your bet slip or your open bets tab on the Sportsbook.

Ryan Knuppel:

Tell us about what operators you’re working with currently, if you can. And then also I’m curious about, I don’t know, I guess the states. I’m here in the United States, so I’m always thinking United States focused, but what states are you able to operate in? Is it the same as we would think is the legal states or what?

Brent Winston:

Yeah. Just off the bat, I mean, we announced the [inaudible 00:08:41] scientific games back in March, I believe it was. So we’re working on finishing that piece of integration. The team over at SGU has been amazing. I’m really grateful for all their help. But yeah, in terms of states, we’re only going to operate in states that sports betting is legalized in. And it’s also driven a lot by our sports betting partners, right? It’s up to them to determine which state they want to launch in first.

Ryan Knuppel:

That makes sense. Yeah.

Brent Winston:

Once they do that, we liaise with the regulators over in the respective state, and then we go through the whole process.

Ryan Knuppel:

That’s cool. And so what do you get out of it? I mean, does Betswap take a little transaction fee from that purchase?

Brent Winston:

Yeah. I mean, it’s like I said, it’s no different than Ticketmaster or StubHub.

Ryan Knuppel:

Yeah.

Brent Winston:

We did our research …

Ryan Knuppel:

That’s a great comparison. I mean, it really is. Yeah. Sorry to cut you off, but great comparison.

Brent Winston:

No, it’s all good. I mean, we did our research on what users were accustomed to paying. So, I mean, Ticketmaster charges a 25 to 30% fee, StubHubs around 25%. Like I said, we’re by the people, for the people. So, I mean, we’re not looking to crush users. We want to give them that big back, right? So the Sportsbooks generally take a decent chunk out of cash out. So I think we’re working out still. But I mean, we’re looking at somewhere in the range of seven and a half to 10% net that the purchaser and the seller charge. So we break that fee up between the purchaser and the seller. So it’s a nominal amount that you pay for the facilitation of the transaction.

Ryan Knuppel:

Yep.

Brent Winston:

And that that’s pretty in line with what I’ve seen other companies in the sports betting space do, but it still undercuts them just a little bit, because we do want to give back to the user. That’s what it’s all about. Right? We’re trying to take the power out of the cash out option and stuff like that. We want people to have that option out. If they want to pay the premium for the instantaneous cash out, so be it. I mean, there’s going to be a little bit of a longer wait time, I’d imagine, at the outset in using a platform like Betswap if you’re a better, because the liquidity needs to be there. But we think over time, as people become familiar with the platform and its concept, that people are willing to pay the lower fee for greater range and sale, right?

Ryan Knuppel:

Yeah.

Brent Winston:

Instead of saying, Brent, you can sell your ticket to one company at a price that’s dictated to you, and you pay this amount, but you’re guaranteed to get them now, versus, Brent, do you want to be able to sell your bet to as many people as you want at a price you determined? It might take maybe a couple hours longer, but you’re saving fees and you’re dictating the price. I mean, I think everybody’s going to want to take that, right? The concept of free market is what we all live for in North America.

Ryan Knuppel:

True. Sure, sure. So everything in this world is about user acquisition, right? User acquisition, user acquisition, trying to get people to … get the attention of the people in this space. So what are you guys doing from that side of things that you can talk about maybe from a marketing side? Or maybe there’s somebody listening that can help in this space. What are you looking for in the user acquisition space? Because I’m assuming that’s just one of the most challenging spots in this. Everybody’s fighting for that attention, so how are you guys going about that in creative ways or in the standard ways? Anything you got on your mind there.

Brent Winston:

Yeah. So, I mean, I think that that’s part of our business model, right? We’re a B2B business. We’re not looking to go out and sell directly to the consumer, right? We’re saying to the Sportsbooks, Hey, here’s a platform that we’ve developed. You don’t have to spend any dev time. You don’t have to spend any integration time. That’s a big part of our deal with SG and being part of their own arena platform. It eliminates the integration time for a lot of their clients, which are a lot of big books in the industry. But we’re not so worried about Betswap acquiring, I guess, users. We’re worried about helping the Sportsbooks offer an innovative product to continue to acquire users. So we’re almost a customer acquisition tool for the Sportsbooks. They can say, Hey, look, we offer this innovative product.

Brent Winston:

Maybe you’re on Bet365 and Bet365 doesn’t offer the marketplace, but FanDuel does. And as a result, the Bet365 user says, well, let me try it out. And they come on to FanDuel site for the FanDuel’s experience with the Betswap marketplace user is amazing, that the new FanDuel user and the former Bet365 user says, hmm, I like this platform. I think I’m going to stick with it. So that’s where I see customer acquisition and customer retention. I mean, Betswap acquiring customers is a whole other story. But I mean, in terms of the user itself, we view ourselves as an add on to help Sportsbooks continue to retain and acquire users.

Ryan Knuppel:

Yeah, so educate me on then how … Is it publicized at the operator level that they work with Betswap, right? Or how does that work? Do they have to download a separate app to use you, or is it all integrated right through DraftKings or through whatever operators.

Brent Winston:

So we’re going to work on making sure that we integrate directly into the sports book, so the Betswap product can be white labeled, should it so be desired. We’re cool with whatever, whatever helps our customers continue to achieve profitability, and help their users experience what they’d like to. We’re happy to entertain whatever. I mean, it would more so be for example, DraftKing saying, we just launched our marketplace. No different than DraftKing’s announcing that they’ve recently just stepped into a new space, or no different than the score now announcing that they’ve got their own trading and risk platform in house. Nobody knows who did it or who built it, but the users know that it now exists. So I mean, that’s how I would see users starting to become aware and accustomed of our platform.

Ryan Knuppel:

Very cool, Brent, very cool. This is Brent Winston, Betswap co-founder. Brent, I always like to ask this entrepreneurial … and obviously you have several businesses. You’ve had experience in lots of different areas. Always, challenges come with being an entrepreneur and starting up businesses. Give the listeners one, I guess, piece of advice from a business side, maybe that you’ve learned along the way that’s helped you get to where you are today. And maybe can help someone else that’s maybe not as close as you are to not go down that same path. Any piece of advice for a up and coming business entrepreneur.

Brent Winston:

Yeah, I think it’s a great question. I mean, I’m going to turn it into two pieces because these are two pieces that I find just fundamental. I mean, the first is understand what you know and what you don’t know. It’s totally okay not to know things. The important thing is to identify what you don’t know, and then surround yourselves with those people who know more than you. I mean, that took me a long time to learn, that you’re not going to know everything and it’s okay to not know everything. So, I mean, if you don’t know something, ask. It’s so important to be able to ask questions and be comfortable asking questions. I think the second thing is just perseverance.

Ryan Knuppel:

Yeah.

Brent Winston:

Nothing is ever going to go the way you draw it out, whether it’s waking up in the morning and how you plan your day, or trying to build a hundred thousand dollar business, a million dollar business, a billion dollar business. So many different startups fail, not because they run out of money, not because the idea wasn’t creative, but because people got discouraged and they just didn’t keep pushing. And it’s totally normal, a natural human response. But I mean, for me, I think that the ones that wind up succeeding are the ones that just keep going no matter what. So I would say persevere, and know what you don’t know, and ask questions. Those are the two things I think are just so important in early stage ventures.

Ryan Knuppel:

Great piece of advice, brent. Great piece of advice. Well, I really wish you all the luck with Betswap. How can people find out more about you or anything they can find out about as Betswap? Or maybe get ahold of you? What’s the best channel of communication there for you?

Brent Winston:

I mean, I’m super responsive, so any social media app, but LinkedIn, particularly, obviously, for networking and business purposes. If you just search my name, Brent Winston, I’m pretty responsive. Send me a message there, and we can take it offline from there. But yeah, I mean, that’s probably the best way, is through LinkedIn, as most people would say nowadays.

Ryan Knuppel:

Great tool, great tool. LinkedIn is a killer tool these days. I mean, just lots of connections can be had. And I think if you’re not using it, listeners, you should be. So get out there and use it for sure. All right, Brent, any last words? Anything I missed? Anything you wanted to cover that maybe we didn’t talk about? Anything you need from me or the audience? Let’s wrap this up. What’s on your mind.

Brent Winston:

I think that I really, as we were talking off stage, it’s just innovation. The space is amazing. I would encourage everybody to continue innovating in the space. If you’ve got an interest in this space and you’re thinking about an idea, push it forward. It might not succeed, it might, but innovation is what continues to drive us forward. And I mean, that’s a big motivator for me in Betswap. We just want to see change in the space and bring it back to the users. I’ll inadvertently help in Sportsbooks, I suppose. But yeah, I mean, keep your eyes peeled, if you’re a sports better, for some of the announcements from Betswap and the coming months. And hopefully, soon enough, you’re able to use the marketplace and buy and sell your bets as you so desire.

Ryan Knuppel:

Well, you really opened my mind to some of this, Brent, because actually some things popped into my head as you were talking, and I just love the angle that you’re going with this. I think it’s going to be a real success for you, and I wish you all the luck. If there’s anything I can do to help or anything from my side, please don’t hesitate to ask. And I hope to have you on episode 175, and we’re talking about how successful Betswap is in the market. So I’m looking forward to that day.

Brent Winston:

Can’t wait, Ryan. It sounds good.

Ryan Knuppel:

All right. All right. Well, this was Brent Winston of Betswap, co-founder of Betswap. For those of you that want to get ahold of him, check him out on LinkedIn. I really appreciate Brent giving us our time today. I really appreciate the audience also listening in. Thank you so much for giving us a little bit of time out of your day. It is August, we’re heading into football season, so let’s all enjoy this. The betting season is coming. So for now, that’s all I got. I’m Ryan Knuppel, Knup Sports Show. This is Brent Winston. Take care, everybody. Have a great day. Bye-bye.

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