Sportsflare CCO Virgil Townsend: “We Are Bullish on Esports Betting Growth”

Sportsflare is an industry stakeholder that focuses on the esports betting market by providing sportsbooks with optimized esports odds that boost responsiveness and help consumers and businesses enjoy a better overall product.

The company brings its genuine understanding of esports titles such as Counter-Strike: Global Offensive, League of Legends and Dota 2 and sets them in a betting context. The odds are calculated using advanced AI algorithms and sticking to best-in-class practices from various industries where similar calculations are necessary.

In fact, the company’s offer has grown so much and it has recently extended its partnership with data provider GameScorekeeper. Sportsflare has several distinct products, including its unique esports bet builder, focus on micromarkets and various player markets.

Today, we get a chance to speak to Sportsflare and gain a better understanding of their product and what they have to offer.

Q: What does Sportsflare do so well that others don’t? How is your esports betting odds product superior, or at least trend-setting when compared to other available solutions?

Rather than making a “faster horse”, which most incumbents are focusing on, we positioned ourselves to create new things that could be game-changing for the esports betting industry. For example, rather than just keeping the match winner market open for 20% longer, we have delivered the very first betbuilder for esports, player proposition markets, and are currently reinventing the in-play experience to include fast-paced micromarkets such as next kill, next bomb plant location and much more. These types of experiences are well beyond the limits of human-scale, and will become commonplace over the next few years, given our aggressive distribution strategy and current momentum.

Our team has a strong background in machine learning, along with years of building an authentic esports betting community. We have published novel AI research in conferences across the globe, even picking up citations by Amazon’s AI research for work that underpins our products.

Q: Sportsflare focuses on micro-markets. Could you tell us a bit more about these markets and if esports players are interested in taking the higher risk associated with them to make a bet?

Micromarkets are an extremely new category in traditional sports, launching in the US only in late 2020 to great fan reception and much venture capital. They turn almost any in-game action into a bettable fixed-odds opportunity, allowing players to capitalise on having superior gameplay knowledge. Some examples of micromarkets in esports are; who will get the next kill, where will the bomb be planted, and what tower will be destroyed next.

A benefit of micromarkets that isn’t immediately obvious is that bettors can quickly recycle their winnings, as bets are immediately settled, rather than waiting until the end of a match. This fast-paced action and settlement provides an order of magnitude more betting opportunities than regular in-play does.

These kinds of bets may actually be less risky for bettors than regular in-play markets, as we are going to market with visualisations that show a snapshot of player locations, ahead of the Twitch stream. Right now, most live esports bettors are already informationally disadvantaged when placing in-play wagers, as the Twitch stream they are watching can be 5 minutes delayed, but nonetheless continue to place an astounding amount of in-play bets.

From our extensive research on esports betting communities, we found that Gen-Z players follow individual players as much as they do teams, so we are optimistic about going live with our player-centric esports micromarkets.

Q: What do you think makes the Sportsflare esports betbuilder consumer-friendly and guarantees ease of use?

Betbuilder products have been hugely successful in traditional sports, accounting for over 30% of match turnover at high margins, but have not made their way to the esports arena until now. Our betbuilder allows esports fans to combine our player proposition markets (e.g. top frag) with traditional markets (e.g. rounds over/under) to create unlimited unique markets for a range of esports titles, giving the consumer an entirely new betting experience.

Our esports betbuilder can be consumed by bettors with the full functionality, or as pre-rolled markets generated by traders on our betbuilder back-office software. Even with only a handful of pre-rolled markets deployed to sportsbooks, we consistently see a similar turnover volume to traditional sports, making them a hit with esports bettors already. Having engaging pre-rolled markets displayed to consumers makes them very user-friendly, as if they were betting on any other individual outcome. The betslip dynamics for parlays/multi-bets are well understood by bettors globally, and are a natural transition to betbuilder.

Q: Do you reckon esports betting is only getting started? Are there signs that interest will continue to grow?

I wouldn’t quite say that it’s only getting started, but it is no longer a niche sport and has so much room to grow.

We are bullish on esports betting growth for 3 reasons: streamer betting, bet-on-yourself, and US esports legalisation. Streamer betting and bet-on-yourself options extend the total market from esports fans to the much larger gaming market, also including casual games rather than the classic esports titles. Esports betting is legal in a third of the US states where sports wagering is allowed, leaving a discrete jump in growth yet to be achieved.

Q: Does Sportsflare worry about the integrity of esports competitions? Can a solution such as yours be repurposed to boost safety in the sector?

While there have been a few isolated incidents of match-fixing and cheating, we believe that this risk is very low in top-tier tournaments. Operators should be aware of the differences between a highly reputable event and a casual online match, and be able to identify these as such. Organisations like ESIC have done a stellar job in policing integrity issues, recently cracking down on 35 Australian CS:GO players for breaches, resulting in 1-5 year bans. Following through on these rules helps prove the legitimacy of esports.

Our recently announced partnership with GameScorekeeper means that we work with a market-leader in esports betting integrity. GameScorekeeper was the first data provider to market with a compliance solution for esports player ages. Our products outline risk-levels by combining GameScorekeeper’s solution with our back-office esports trading team, sportsbooks can then use our product to only offer markets for the highest-integrity matches, for example. Gleaning additional insights about possibly match-fixing from betting data is on our roadmap long term.

Q: Are there any significant challenges with further product adoption you foresee when it comes to esports betting odds?

There will always be innovators/early adopters who are looking to beat competitors, and laggards who will only move after everyone else, so we are targeting innovative customers and partners that are being rewarded for their progressive approach.

In our eyes, esports betting presents a fundamentally different data opportunity than traditional sports, given that it is 100% digital. Treating it the same as brick-and-mortar sports may work right now but will be an increasingly poor strategy for operators.

Demonstrating the value of these new esports betting products through empirical data will be key to increased adoption from the late majority. The pandemic was a catalyst for esports betting, where almost every single operator now has some form of esports wagering, so demonstrating the value of esports betting is a much easier task than even one year ago.

Q: How has 2020 impacted your business and what is your outlook for 2021?

We are riding the macro tailwinds, where a validation of (and optimism in) esports has been established by the majority of market participants in 2020.

Although esports betting became hot in 2020, there were still some challenges for us, such as investor uncertainty, closure of many esports competitions, and sportsbook customers being in financial jeopardy. Fortunately, things improved substantially in these areas in the second half of 2020, and it has catapulted our business toward a strong 2021. Additionally, we were acquired by Tiidal Gaming in December 2020, and are listing on the CSE shortly, which positions us nicely to execute on all that this year offers. Stay tuned for a lot of exciting announcements from Sportsflare and Tiidal Gaming!