Sportradar
On 14th September, global sports data and broadcast solutions firm Sportradar made its much-anticipated debut on the Nasdaq stock market after following through with its plans to go public.
The Switzerland-based firm raised some US$513 million from the sale of 19 million shares priced at US$27 apiece, giving the company a reported valuation of nearly US$8 billion. An additional US$159 million has also been secured from a group of investors headed up by Los Angeles Dodgers co-owner Todd Boehly, who have agreed to purchase 5.98 million shares in the business. At the end of its first day of trading, Sportradar’s shares were priced at US$25.05 each.
Sportradar’s initial public offering (IPO) ends a process that was first reported in July last year and also saw a US$10 billion merger with Horizon Acquisition Corp. II, a special purpose acquisition company (SPAC), fall through in June.
In a statement celebrating the IPO, Sportradar’s chief executive, Carsten Koerl, said: “Ringing the opening bell at the Nasdaq as a public company is a significant milestone in the history of Sportradar. It is a testament to the ambition, originality and resourcefulness of our employees, the strength and commitment of our partners, the confidence and support of our investors and the vision of our customers.
“Moving forward, we’ll continue to propel digital transformation across the sports ecosystem as a result of our dedication to developing the most innovative products and solutions that drive fan engagement.”
Sportradar, which was founded in 2001 and whose investors include Ted Leonsis, Mark Cuban and Michael Jordan, supplies sports betting data and entertainment services to sports leagues and organisations around the world. Currently, the company holds partnerships with over 150 leagues globally, and provides data for more than 900 sports betting companies from 750,000 events annually across 83 sports.
In 2021 alone, Sportradar has already bolstered its capabilities with the acquisitions of Synergy Sports and Interact Sports, while its revenue for the first half of the year stood at €272.1 million (US$318.6 million), representing an increase of 42 per cent compared to the same period last year.
On the day that the company officially went public, SportsPro spoke with Eduard Blonk, Sportradar’s chief commercial officer, about how the IPO eventually came to fruition, what it means for the business, and the potential impact on the sports data industry.
Why did now feel like the right time for Sportradar to go public?
Well, that’s a great question. Sportradar is addressing markets that are growing tremendously. So the opportunity [is there] for us as a company, and these big opportunities require big investments.
With with the funds we are raising through this IPO, it will accelerate our growth. It will give us the ability to accelerate our investments in technology, in people, and that’s also down to acquisitions as well. We have an acquisition strategy, we have an acquisition track record as well, this year is also our 20-year anniversary as a company.
So it’s really [about] addressing those growth markets and accelerating the growth for Sportradar.
Earlier in the year it was reported that your proposed merger with a special purpose acquisition company fell through. Why did you ultimately decide to go down the IPO route?
Well, we always had a dual track. So we always looked at both ways to become public. Ultimately, it’s a decision of the investors and our board, whereby we have chosen that the IPO route was the best fit for Sportradar. And that’s what we ultimately have done.
If you look at our SPAC partner that was [part of] the original track that we were on, they are part of our IPO today. So they are an investor and that relationship is a strong one that continues now as Sportradar becomes public.
In what ways do you think you’ll be able to serve the industry differently now that you’ve gone public?
I don’t think differently. I think what you will see is that Sportradar will accelerate the services that we bring to market. The past 20 years has been a period where the company has grown year over year, strong, always profitable, free cash flow. All of those elements have always been a part of Sportradar. But I think the opportunities are there for us to accelerate that growth.
If you talk about technology, one of the areas, for example, it is computer vision, it is artificial intelligence, because in the end, if you’re able to collect more and more data points per match, and these are a vast number of data points, what do you do with these data points? The data points are your raw material, if you like. It’s the story they tell. And that story, and how that fits with the different audiences, the different market segments that Sportradar addresses, that requires technology. It requires constant innovation, it requires requires constant investment. And that’s what we have been on.
So what the market will see is that we will continue. It may accelerate for some of the market segments or they may see that acceleration, although for us we have always had a very clear strategy on where we want to be as a company and the service that we want to bring to market.
In that case, from a strategy perspective, do you not feel much has changed despite going public?
No, it gives us the power to accelerate. It’s not going to change the direction of our company or that we have suddenly now a different vision. That is not the case. The IPO is not the start of the company, it’s an acceleration. It’s a milestone, absolutely, it’s a very important milestone, but it’s not that as of today we are a new company. It’s not. We continue with the teams, we continue with the developments that we have. But again, that innovation and the acceleration of technology and innovation, that is really key for us to address.
Sports betting services are an integral part of Sportradar’s offering. You mentioned in your own estimates that you expect the sports betting industry in United States to be worth up to $23 billion. Just how important will sports betting be for your strategy going forward?
It is an important part of our strategy. The sports betting market is a large market, the US is a market that is growing tremendously fast. There are different analyst reports that show what that market is at maturity. If it is US$23 billion, that is how we have been looking at that market, but there are other numbers out there as well. It is accelerating and exciting.
But what really is important is that if you look at sports betting, but also then compare that to to engagement with fans, the sport ecosystem that is a part of it, it’s actually becoming more and more converged. You see media, sports betting operators, all of that really converged into the direction where you are serving a sports fan. I think that’s the key: how to activate, how to stimulate, how to take that user on that journey by being able to provide the story about their team, the athlete that they’re following. Then sports betting becomes one of the elements of many others. I think that’s how we look at sports betting and the role that it plays in Sportradar.
Of course, sports betting is also based on data, it’s based on the fastest data that you have available. But again, there it’s also the story that you tell and are able to tell with data. Media is a part of that, because you look forward, you look at predictions, you look at performance, you look at what happened in the past and what could happen moving forward.
So there is a story to tell, and that makes it so exciting.
Sportradar has made a number of acquisitions this year already. Are more in the offing on the back of the company’s IPO?
I can’t really talk about our plans in acquisition, but acquisition has always been a part of our growth strategy. We have a clear, organic growth path, and we have growth through acquisitions as well. The recent acquisitions, with Synergy as one of them, and Interact as the other, shows that that is a part of our strategy for growth, and that will continue to be so.
We will be looking at smaller companies and bigger companies as long as they add value in tech, value in knowledge to Sportradar, and have a good fit with what we as a company see as a strategy moving forward.
You’ve had success in various markets already, but where do you see opportunities for expansion in the future?
We definitely see opportunities in several markets. We’ve talked a lot about the US, and the US is a very important market opportunity. That is driven by, of course, sports betting regulation, but also the whole digital transformation of the consumer, the sports enthusiasts, how information is being provided. The US is always at the forefront when it comes to the digital transformation, so that is an exciting market.
But we track a lot of the markets, we track basically all of the markets. We invested in Africa very early on, we are tracking what is happening in South America. And then of course, we are tracking the Asian market as well. So, when markets regulate – and that’s from a sports betting perspective – we will be there, and we will be there first in most of those cases, like we have done in the US as well.
But that whole digital transformation, that sports fan is an important part of our growth strategy as well and the role that we play. That is actually in relation with the leagues and the federations. So it’s not about just the data, it is the services and knowledge that we also bring to the leagues so they can engage with their fans.
That is an important part of our growth next to the sports betting industry.
