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Following Oddschecker Media Group’s rebrand to FairPlay Sports Media and a series of acquisitions made by the network, CEO Stuart Simms discusses the potential further deals in the pipeline, and how they could tie in with owner Bruin Capital’s strategy.

“I don’t ever worry about exits, because the moment you start doing that is the moment you fail your customers and your investors.”

Stuart Simms offers a defiant response when asked if exit strategies are behind his employer’s recent moves in the M&A market. The CEO is tasked with overseeing a rebrand as well as an acquisition drive; one which aims to mould one of the most prominent operations in the online gaming affiliate space into something far more diversified.

In January, Oddschecker Global Media (OGM) announced its rebrand to FairPlay Sports Media (FPSM). This followed the purchase of Italian sports betting affiliate SuperScommesse from Catena Media in November. OGM launched its new affiliate venture Confido Network in the same month.

Shortly after the rebrand, FPSM acquired Toronto-based Quarter4; a deep-learning neural network that specialises in predicting sporting outcomes. This tied in with FPSM’s plan to look into purchasing data and AI-driven companies, and FPSM is making no secret of its desire to continue shopping for more brands.

Simms expands to NEXT.io: “Our overall strategy is to build out platforms that enable us to build compelling components and products that we can take to market through our own brands as well as partner brands, whether that’s through media, publishers or TV.

“Quarter4 is a platform that will help us improve our products. It’s already utilised by other companies. It’s a very complementary offering to the data providers that are already out in the market.”

View from the top

Oddschecker has been on quite the journey since being founded in 1999. It was acquired by Sky Betting & Gaming in 2007, before falling under the CVC Capital Partners umbrella when the investment group bought 80% of Sky Bet from Sky in 2014. Another transition followed in 2018 when The Stars Group purchased Sky Bet, before the group’s merger with Flutter Entertainment in 2020.

The latest stage in the journey came when PE company Bruin Capital bought OGM from Flutter in 2021 in a deal worth up to $215m. Led by former IMG President George Pyne, Bruin Capital was founded in 2015.

Among its portfolio of investments are sports-related businesses such as golf simulator Full Swing, experiential marketing agency Engine Shop, and more recently, Box to Box Films, the producers of the hit Formula 1 documentary Drive to Survive.

Evidence of what Bruin Capital can do to brands has been demonstrated in some of its recent activity. In January, the group agreed to sell sports marketing agency Two Circles to Charterhouse Capital Partners for a reported value of $317.5m after purchasing it at an enterprise value of $40m in 2019.

Oddschecker still operates as a standalone brand, but its position within the company seems to be slightly different under Bruin to what it has been in the past. It is now the signature brand, rather than being a backbencher, but that could of course change.

Simms is used to having responsibility in global organisations, with his CV boasting senior management positions at the likes of Microsoft, Rakuten Marketing and gaming affiliate XLMedia, where he was group CEO from 2019 to 2022, before joining what was then OGM in the November of that year.

Simms has overseen various acquisitions in his career, including the purchases of Philadelphia sports website Crossing Broad and college football news publisher Saturday Football Inc. when he was at XLMedia. This may go some way to explaining why he was chosen for his current job a little more than a year after the current ownership took charge.

No exits in mind

To bring us back to the quote at the top of this article, it would seem to be normal practice for PE investors to build value by essentially fattening up the company’s portfolio, building out assets and diversifying the offering with a view to ensuring a return on their investment when the time comes to inevitably sell the business.

“It’s a bit of an elephant in the room,” Simms says. “People see we’re owned by private equity and assume we’re only going to be involved in businesses for about three years.

“We’re already diversified, in terms of our revenues. But we probably hadn’t productised our technology as well as we could have done in the past, to take it to a broader market, which is why we launched FPSM.

“With the kind of AI technology and the access to data we have, this is a very long-standing and successful business that I think I can take forward for many years to come. I don’t look beyond that. If you take a long-term view, you’re more likely to build value that way.

“Bruin know the US market really well. Their appetite is for us to acquire brands and add value to them. They’re always looking to see how we can facilitate work across their different investments.”

A new model

When it comes to M&A, the standout competitor that comes to mind in this regard is ironically the company which sold SuperScommesse to FairPlay; Catena Media. While Catena may be a public company, it has also been focused on building a portfolio of brands; the total is now in the hundreds.

While that may be some distance away from the number of brands FairPlay plans to bring into its stable, the process of growth by acquisition is comparable. This leads to the question: Do affiliates need to branch out of the more traditional affiliate model by growing via the acquisition of different types of brands?

Simms responds: “We’re not really trying to divert away from being an affiliate. Only about a third of our UK revenue comes from the affiliate business. The rest comes from sponsorships, takeovers and transactional revenue. As a group, we already have a diverse range of platforms and products that we monetise in lots of different ways.

“Rather than altering our revenue stream, I think what has changed is that we’re putting a lot more focus on products that we can take to market both through our own brands, but also through other brands as well.”

Cogs in the wheel

With FPSM transforming into a conglomerate, this will of course bring an array of internal challenges when it comes to streamlining and making sure all the separate brands are aligned.

Even within the gaming industry, one of the biggest online gaming groups in Entain has proved how strong acquisition drives can turn ugly, with shareholder unrest growing in the last year partially as a result of what has been seen as too much M&A activity.

Simms says: “I’ve been involved in quite a few acquisitions. When I was at Rakuten [from 2017 to 2019, serving as CEO for his last year there] I oversaw five acquisitions the company had done in the prior four years before I joined, so from a personal point of view, I’m really comfortable with post-acquisition integrations.

“The crucial thing with acquisitions is they have to be accretive to our strategy; you can’t change the strategy to go and buy whatever fashionable new brand pops up on the radar. A lot of the mistakes I’ve seen in M&A have come from when people have been too opportunistic, and they have then suffered the consequences because they’ve had to change their strategy accordingly.”

Simms insists further acquisitions are not a requirement set for him by Bruin Capital, but it is something he will have to be aware of.

He says: “Honestly, if we never did another acquisition in my tenure, I think I could still build an amazing business with the team and technology we already have.

“I think though there are some really solid consolidation opportunities, from an audience standpoint. We will look at brands that could add value, and that we could then power with our technology. I think we’re still likely to see a lot of consolidation in the market, and I particularly see Latam as a region that is really starting to motor.”

Specifics of AI

AI is of course an issue that is becoming more prevalent in sports betting, and its effect can have a very broad scope. AI is mentioned as part of FPSM’s acquisition drive, but Simms elaborates on what that means for the business specifically.

“Classic AI tends to look at historical data and predicting a path forward, and then the algorithms are tuned to predict an outcome. But in football for example, if someone gets substituted or a team changes their formation, or someone gets a red card, then quite often the classic AI that provides predictions can’t respond quickly enough.

“For us, it’s about enabling operators or consumers to get access to real-time updated views of what’s going to happen next. That is a really important difference between Quarter4 for example and some of the other companies we looked at; that will continue to be what we look at going forward.”

It is ironic that Simms mentions predicting a path forward, as it seems even forecasting what his own company will look like exactly in a few years is a difficult task, but the industry can certainly expect FPSM to be busy.

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