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Sports betting innovator launches new start-up
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17 November 2021

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By Douglas Fraser

Business and economy editor, Scotland

Among Scotland’s most effective innovation teams is starting once again with a new firm - and has actually protected the biggest initial investment of any British start-up business.

BetDEX is being led by Nigel Eccles, who co-founded dream sports betting website FanDuel in 2009 in Edinburgh.

The brand-new firm has seed funding of $21m.

It aims to release a new open source software application platform, on which others can innovate in sports betting, in the first half of next year.

The company is hiring staff from a base in Scotland.

FanDuel was sold to Flutter - previously named Paddy Power Betfair - in 2018 and is now worth more than $30bn.

However, Mr Eccles and other co-founders remain in legal dispute with FanDuel’s later phase financiers over the way in which they structured a takeover, which left the Edinburgh team without a share of the rising appraisal.

Mr Eccles stated that one thing he gained from the FanDuel experience was to choose financiers carefully.

He told BBC Scotland: “We took a lot of lessons from that, one of which was the significance of who we select as investors in this new organization, to guarantee their values are lined up with ours, that they take their fiduciary tasks responsibly, and that they’re the ideal partners for us.”

The $21m seed funding for BetDEX includes stakes taken by 7 backers of US innovation companies, including 2 large funds - Paradigm and FTX - which specialise in buying business operating with crypto-currencies.

Varun Sudhakar, of BetDEX, said: “The sports betting market charges high prices for poor products and limits trades by its most successful users.

“BetDEX is diametrically opposed to this technique. We will successfully complete versus incumbents with a considerably superior item and low costs, which is now possible with the advent of the blockchain innovation.”

As chairman of the new firm, Mr Eccles stated it might look familiar to retail punters utilized to existing online companies.

‘Pool of talent’

However, he says that those who use its platform to run their own sports betting firms will be able to innovate and produce a wider series of wagering products.
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He said the common share taken by online bookies is 7% to 10% of a stake, however BetDEX should allow for that to fall below 1%.

The company will develop its own sports betting apps to run on the platform.

Mr Eccles said these would take an “intelligent, thoughtful” approach to the way they are marketed to safeguard those who deal with problem sports betting.

He stated the team of around 500 software application engineers who helped construct FanDuel from Scotland showed that it remains the location to construct a firm. BetDEX has the same head of innovation, Stuart Tonner.

“A great deal of that [FanDuel] success was developed on a highly experienced, extremely skilled engineering group, that developed this product that could process millions of bets and countless users.

“There’s a genuine talent swimming pool of knowledgeable engineers who helped us construct our item which’s what we desire to utilize for BetDEX also.”

Related subjects

Edinburgh

sports betting wagering

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FanDuel founder leaves business

Published

20 November 2017