All Eyes on New York

Mark Blandford was one of the first offline bookmakers to recognise the potential for sportsbetting on the internet. He has seen the rise of London as the industry’s power base and witnessed the success of Malta in attracting iGaming companies, but he believes that the sector’s next epicentre will be New York.

Can you tell us how you got involved in the gaming industry? 

I am a farmer’s son, but both my parents were interested in horseracing and they knew some of the leading trainers and jockeys of the day. I naturally inherited their interest and loved studying the odds. When I finished school, I studied business with a focus on marketing. Then I had a couple of jobs in B2B marketing but I found these jobs very frustrating as I realised that it will take me a long time to progress. I was always very entrepreneurial in nature, and at the age of 27 when my wife began talking about starting a family, I realised that if I want to start my own business it was now or never. The industries I had worked in were difficult to start up in, and the only other industry I knew something about was bookmaking. At the time, I had a friend who owned a betting shop and was kind enough to train me how to be a bookmaker. I then bought my first betting shop, and in the years that followed I built a small chain of betting shops. In the 1990s, one of my neighbours introduced me to the internet. I looked up sportsbetting and bookmakers – not much came up, and I suddenly realised that the internet could provide an additional distribution channel for betting products.  

Where did you go from there? 

I was quite taken by the internet’s potential. It was the absolute beginning of this industry, and only a few bookmakers had an online presence. I sold the betting shop chain at the end of 1997. I went all in on online gambling and founded Sportingbet. In 1998 I got a licence from the Isle of Alderney, which gave us a competitive advantage. While UK-based companies were required by law to add a 9% tax to all bets, Alderney was betting-tax free. The first years were quite exciting but also challenging as there wasn’t any suitable sports betting software available compared to today. At the time, mentioning online gambling and credit card processing together was also a very easy way to get thrown out of a bank, but we battled through. 

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How would you describe the current sportsbetting landscape – online and offline? 

When I sold my betting shops to set up Sportingbet, I was convinced that the future of sportsbetting was online because it allowed for greater operational efficiency. But I still thought that there was a market for betting shops. However, today I believe the outlook for offline is pretty poor, and betting shop owners have to accept that they are running a mature business. We are seeing significant changes in customer behaviour – today’s customers prefer to bet online. In addition, high street is under pressure with footfall, and you’ve got a regulatory regime that amplifies costs. We have gone from too light-handed regulation to heavy-handed regulation. I am absolutely in favour of protecting vulnerable players, but I think we have gone too far and this is not healthy for business. By the way, the same applies to the online world, and I do believe that the high regulatory costs could actually drive businesses offshore again. 

The iGaming industry appears to be facing an increasingly restrictive and hostile regulatory environment in many countries. What are the reasons for this?  

For a long time, the industry has not invested sufficiently in PR and lobbying. That’s why we now have a large number of politicians who would rather look the other way instead of standing up in favour of the gambling industry. It is ironic that this is occurring at a time when the industry is larger than ever. 

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Let’s talk about your third life in gambling. As a venture capital investor with Burlywood capital, where do you see the industry right now? 

As the online industry has matured, funding streams have grown in tandem. The industry is huge today. It is entrepreneurial in nature, which attracts angel and seed investors in greater numbers. We are now also seeing private equity – not just venture capital – flowing into the industry. While some 20 years ago the businesses were just not big enough to attract private, equity, we now have huge profitable businesses that private equity is interested in. If you need €1 million these days, it is probably much easier to get it today than it was five or six years ago. At Burlywood Capital, we are seeing interest not only from European but also American investors. 

What does the ideal candidate for venture capital look like these days? 

There is no such thing as the ideal candidate anymore. An interesting candidate could be active in a particular segment. For instance, interest in eSports has exploded. But from time to time things become the flavour of the month. I remember a time when everyone wanted to become a Bingo operator, followed by a period where Poker was big. Then we moved on to social gaming. The reality is that we have seen a few gold rushes. The most recent one was the hype around blockchain, which is currently tailing off. To offer every vertical is the hardest for an early stage business. It is nearly impossible to compete with today’s gambling industry conglomerates. However, we see a lot of business plans, and I can say that there are still a lot of creative minds out there coming up with new ideas. To be successful in raising money, ones need to have a clear plan on how to use the capital, while projections have to be realistic.  

We have seen a number of gaming ICOs in 2018. what’s your view on ICOs as a fundraising method and on blockchain technology in general? 

There are surely a lot of overrated and hyped ICOs. I have seen many ICOs, where what was on offer and what was promised was disconnected from reality. In my opinion, the situation is comparable to the times of the bubble. The price of investment into that sector is running ahead of the returns. It doesn’t mean that the technology is not working; in fact, the underlying technology is great. We will undoubtedly see a number of blockchain applications that will be developed in the coming years. However, I am also sceptical about the cost-effectiveness of crypto payments. In some cases the transaction fees that cryptocurrency exchanges charged were higher than those that would have incurred when using more traditional payment channels. 

In your opinion, what is the most attractive place for iGaming companies wanting to do an equity listing? 

The London Stock Exchange is strong and an attractive market for iGaming. Companies with international, and in particular Scandinavian exposure, should consider Stockholm. The valuations for companies at the Nasdaq Nordic Exchanges are quite attractive and investors understand the industry. I also believe that the industry should look to the US. We are already seeing American investors wanting to put money into the sector. At Burlywood Capital, we have registered interest from US firms with investments in the physical casino industry and who now wish to invest in online betting. This trend is just emerging, and US investors will have to be educated about this industry, but I believe the potential is there. 

What’s your outlook for the industry? 

I believe that New York will be the next big hub for the industry. We have seen the growth of London and the success of Malta, but I truly think that New York will define the next five to ten years.


Mark Blandford was the owner of a betting shop chain from the early 1980s to the mid 1990s. When he recognised the potential of the internet, he founded Sportingbet PLC, at one time the world’s largest bookmaking operation and a pioneer in online gambling. After stepping down from the board of Sportingbet in 2007, Mark has become one of the most active and successful investors in the digital pay2play entertainment space. He also formed Burlywood Capital, a corporate finance advisory business focusing on gaming and support industries.


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