Why US billionaire Yass is punting on PointsBet

Why US billionaire Yass is punting on PointsBet

You’ve got to figure out the price, use probability and statistics, you’ve got to use game theory and analytics, you’ve got to put up the best price – know what you are doing and be confident in your price.” Yass told this masthead.

“So, the skills it takes to be a good options trader are the same skills it takes to be a good bookmaker.”

For Yass it’s about using the technology and the warp-like speed that provides analytics and defraying risk to offer more sophisticated products and more generous odds to the punter.

Real-time betting on live games – the ability to place bets on winners and losers in a similar way that derivatives offer long and short positions in options – is not just what excites Yass (and his two kids that work in the business), it Also serves as entertainment in the Yass household.

“We love sports betting. I love it, my kids love it (and) we talk about it all the time. And it’s a joy for us that we might actually make money doing something that we love to do.”

Yass – the living embodiment of arbitrage – is particularly focused on ‘in-game’ betting – a type of punting not sanctioned in Australia but is an authorised product in the US – which is where Yass has his sights set on building a foothold.

Betting platforms have seen a flood of new users this year.Credit:Wayne Parry

PointsBet is still a relatively new player having secured a market share of about 5 per cent in Australia and in the early stages of taking a place in the US market. Like most other players in the space, its share price has been beaten down by a crowded, competitive market and irrational pricing.

For PointsBet the key to the Susquehanna investment – apart from a $94 million capital injection – is the access to the technology that the US company has developed. Yass told this masthead that having identified PointsBet’s management as the smartest in the business and with a similar approach, Susquehanna, contacted them to do a deal.

For Yass, this investment is just the start and he hopes that using his substantial capital, he can take a pivotal role in the consolidation of the industry.

However, he appears to have little interest in PointsBet’s Australian operations that recently attracted the interest of Lachlan and Rupert Murdoch’s News Corporation, which unsuccessfully offered to acquire the domestic business for around $250 million.

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Placing a toe in the bookmaking market aside, Yass has also needed to make a bet on the broader markets and the economy.

“We are in precarious times, the volatility is very high (and) the world is in a delicate spot. There’s a small chance that it will be really ugly, (there’s) a pretty good chance we will crawl out of it and a fairly significant chance that things will get great,” he said.

“The political situations around the world are pretty scary. If everything calms down we can see the greatest creation of wealth and prosperity in human history – if things don’t it could be frightening – again it’s just probability.”

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