Smarkets Blog

There have been some exciting developments in the online betting industry. It’s great to see more innovation coming to betting tapping into the tremendous market opportunity. Even though it’s worth an estimated $20 billion (and growing), most of the big online bookmakers offer the same boring products with no web 2.0 features that internet users have come to expect. The top three online betting companies are Betfair, Ladbrokes and William Hill.

Betable went live today with their pool betting product. Congratulations to the Betable team for launching! Betable has been under development in San Francisco for a year or so. Recently some of the team moved to London. It’s great to see other startups launching in the space. For those unfamiliar with pools, bettors put their money in a pot and the winners split the pot after commission (usually 10-20%). Pools have the advantage that participants don’t have consider the odds – the odds are computed after the betting has ended.

Pikum made waves when it launched a similar pool betting product two years ago. Pikum offered betting on football markets, but didn’t let participants create markets as you can on Betable. It ran out of money before it was able to gain any traction in the marketplace and folded a little less than a year after launching.

Bragster (formerly launched as Gottabet in 2008) aimed at mate to mate bets that users could create themselves. “I bet you £20 you can’t eat all the donuts”. They weren’t able to gain significant traction in bespoke bets, so they rebranded as Bragster to a social network centred around bragging rights. Not just a clever name! They were acquired last month by the Guinness Book of World Records.

Boolabus has taken an agency model and offer the big bookmakers (e.g. Ladbrokes) cool software that they can plug into their websites . Their focus has been largely what’s known as “in-play” betting – betting after the match has started. Even though the odds update in semi-real time, bookmakers still add quite a large profit market to their odds so the punter doesn’t get good value. The punter doesn’t have the option to lay a bet either.

Betfair pioneered the concept of betting marketplaces a decade ago. They have been building up their US presence after making the purchase of TVG, a horse racing TV network. Betfair is a fantastic product for the professional bettor, offering the best liquidity in the marketplace, but it has a high learning curve for the casual punter. Like the other major bookmakers, Betfair has almost no social features to speak of (although Betfair has a forum).

Smarkets is innovating betting marketplaces by bringing the power of exchanges to a wider audience. We’re creating a simpler user experience with a social layer. On Smarkets, the price of a bet changes in real-time. This type of market dynamic is perfect for live events. For example, betting on the cycling race where a crash could wipe out half the field or an election where a news story could decimate a candidates chances, Smarkets works very well. Also, Smarkets allows to participants to buy or sell an event at anytime up until the event has concluded.

We have a host of social betting features that we’ll be launching shortly. Our next major release includes the UK election markets. We’ve been hard at work at Smarkets for almost 3 years building a scalable and reliable technical architecture.

It’s great to see innovation coming to betting. Pikum and Gottabet failed, but the new crop of betting startups Smarkets, Boolabus and Betable are forging ahead in this massive industry begging for new blood.