These days, the word ‘Legend’ is thrown around too loosely. In this case, however, I am going out on a limb and state that Mark Blandford ticks this illustrious box.
Few can rightly claim to have been ‘in the room’ when sports betting transitioned from high-street betting shops into the online era. Mark can make this claim because he actually was.
He is best known as the founder of Sportingbet, which became one of the world’s largest online bookmakers during the early 2000s, helping to establish the commercial viability of internet-based sports betting.
The Birth of an Industry
We begin at the beginning of online sports betting as we know it, and I ask Mark what convinced him that online betting could become a mainstream global industry?
“My professional training was in Marketing,” he reveals. “I realised that the internet represented a new distribution channel that would work in gambling, where I was a betting shop owner/operator.
“I saw that the internet presented the opportunity to market internationally, and that first-mover advantage was going to be important for a new brand. Others missed this; Ladbrokes, for example, launched three years after Sportingbet.”
As an independent, Sportingbet needed a defensible edge over competitors. “There were far bigger brands than us in regulated markets like the UK, based on betting shops and telephone betting. Tech was a huge factor because there were no European/British front-end platforms to licence in 1998, Mark explains.
“Our risk appetite also helped. It was not that we were breaking any laws; online gambling laws did not exist back then as technology had moved faster than governments and regulators!”
Regulation? What Regulation?
Establishing metrics when scaling is essential. As Mark explains, these disciplines evolve: “In the early days, the focus was on cost per customer acquired. Understanding customer lifetime value followed. Another factor was the percentage of attempted payments that were rejected.
“Compliance was not much of an issue in those early days, as there was no relevant regulation.
“We were initially in debit and credit card markets and although it was difficult to get suppliers when we started in 1998, by 2000 their number was growing.
“Technology was a struggle, but it provided a ‘moat’ to Sportingbet as we had developed our own tech platform. Those that followed had the same issues with technology to begin with, especially at times of peak demand.”
With expansion extending internationally, regulatory uncertainty in different jurisdictions was a new challenge. This was addressed by market feasibility studies, together with reskins of the site to localise and test customer acceptance and cost. “Given the lack of regulation before the mid-2000s, the priority was commercial matters. But UIGEA (the Unlawful Internet Gambling Enforcement Act) in the US in 2006 was the gamechanger for Sportingbet.
“We had 13 days to withdraw before the Bill became law. It was clever legislation in that it made the underlying act of transferring money for the purposes of illegal gambling (undefined) into money laundering which, of course, is internationally extraditable.”
Timing is Everything
Concluding on Sportingbet, I ask about the secret of its success, and whether Mark believes that structural industry tailwinds, excellence of execution or timing was the main factor?
“Timing was the biggest factor,” he responds without hesitation. “We had first-mover advantage with a new distribution channel that was tailormade for gambling.”
Sharing the Gold Dust
Moving on to ‘pick the brain’ of this proven pioneer, the conversation shifts to topics where Mark’s consultancy fees may be astronomical. So pay attention, this is the part where lessons are learned.
During Sportingbet’s high-growth phase, Mark made leadership decisions that altered the course of Sportingbet’s history. That he is happy to share is quite literally ‘gold dust’…
“We hired talent ahead of our size to assist in growing into the business that we became; we controlled our own tech and trading, and we listed the business in London to enable prompt fundraising during the .com boom.
“We focused on profitability ahead of many other who were stuck when the .com boom turned to bust, so when the crash in valuations came, we were making £2m profit per year and had raised a net £15.5m from our AIM (Alternative Investment Market) listing.”
Downside Protection
In an industry where regulatory change can materially impact revenues overnight, downside protection of the business must be like walking on eggshells.
“It is difficult to understand how to protect the downside with regulations and tax rates changing for the worse. In the UK, the new tax rates are going to spawn a lot of offshore and illegal supply.
“In Germany, in-country licensed operators are at a product and a tax disadvantage, giving offshore suppliers a competitive edge. And in the US, several states overtax the industry, fuelling what is a substantial offshore industry.
“The portfolio effect helps, where being active in a number of markets reduces the critical risk of single market issues.”
What Lies Ahead
“We recently invested in a couple of businesses that do not generate their outcomes using RNGs. Take a look at https://155.io, video-driven results of true chaotic events. The biggest hit within their portfolio is Rush Hour. I have never seen a betting event scale so quickly via organic market traction.
“I also like the Prize Draw space. It is in its infancy but is widening the demographic reach of gambling. We are investors in Good Life Plus, who have launched B2B and getting all kinds of brands wanting to be associated.
“Finally, I must mention AI and its potential across all verticals. It can cut across product development and operations by optimising CRM, anti-fraud solutions and cost efficiencies in marketing.”
Winning Mark Over
In conclusion, it would be remiss not to ask this iconic entrepreneur and serial industry investor what immediately disqualifies someone pitching him a new betting or gaming venture today? “Being too ‘salesy’, with over-optimistic projections coupled with no fiscal contingency.”
Conversely and finally, what instantly grabs his attention? “Displaying a deep knowledge of the market opportunity they have identified, and how to fill that market gap.”
Sounds simple enough…?
Personal Summary
Today, Mark is Principal of the Blandford Family Office, targeting development capital investment opportunities in tech including the wider gambling and support industries. He is a Director of AIM-listed Gaming Realms and a former Chairman of Gambling.com Group. Other gambling-relevant holdings include 155.studio, Betmen, B90 Holdings, BeBettor, Fantasy Football Hub, Scoreline.ai, Future Anthem, Good Life Plus, Payen Card and Synalogik.
Mark enjoys football and rugby and is a shareholder and VP of Hereford FC and a sponsor of Luctonians RFC. He enjoys playing poker and travel and combining the two.
